MERS Has No Standing in Michigan in Some Foreclosures

Posted on April 27, 2011

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Station WXYZ in Michigan reports that the state Appeals Court in Michigan has ruled against MERS having standing to foreclose In some types of foreclosures in that state.

“In the ruling, which came down April 21, the court ruled that MERS was not entitled to initiate what is called “foreclosure by advertisement.” Local lawyers are telling people that if MERS carried out their foreclosures, they should go to court as soon as possible because any eviction involving MERS must be dismissed. Those same lawyers will be holding a free clinic for advice if your foreclosure or eviction has anything to do with MERS.  It will be on Monday, May 2nd at 6 p.m. at 5920 Second Avenue in Detroit.”

The MERS plan was to hold the physical mortgage while banks traded them in bulk as bonds on a market, similar to the bond market. The problem is MERS lost the notes. Maybe they exist in a warehouse somewhere, but MERS can no longer find the loan upon request. The problem, besides that one, is property cannot be foreclosed on without proof of possession of the note. But foreclosures have been happening anyway. Demands for proof of possession on the note have not been accorded the diligent review by the courts that the law requires. now that is starting to change.

See the article here.

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