Posted Sep 21, 2011 01:08 am CDT
The district attorney of Dallas County, Texas, today sued Mortgage Electronic Registration Systems, its parent Merscorp company and other defendants, contending that a shadow electronic recording system confused title to real estate and cost the government a great deal of money in lost filing fees.
District Attorney Craig Watkin estimated that the MERS system cost the county $50 million to $100 million in filing fees, reports Housing Wire. At least one bank was named as a defendant; however, the $50 million to $100 million estimate presumably relates to all filings in the county, not just those related to that bank.
“We are looking at it from the standpoint that because this entity was created, they were able to shirk this responsibility to pay the filing fees that are associated with a mortgage transaction,” Watkins told the news agency. “When a document is filed with the county, there is a fee that is associated with it, but because of MERS these fees have not been paid.”.
The article says MERS declined to comment and other defendants couldn’t be reached for comment.
A Dallas Observer blog post provides additional details about the Dallas County suit.
Hat tip: Bloomberg.
ABAJournal.com: “WaPo Explains the ABCs of MERS, Which Struggling Homeowners Are Leveraging in Loan Negotiations”
ABAJournal.com: “MERS Changes Rules, Says Mortgage Servicers Must File Assignments with County Before Foreclosing”