The MERS debacle is having the effect of causing banks to utilize short sales as a way to mitigate losses. MERS stands for Mortgage Electronic Registration System, and is the nominee assigned by lenders to facilitate trading of securitized portfolios of notes guaranteed by deeds of trust.
CNN Money
MERS allowed lenders to circumvent local recording fees to municipalities by keeping the records electronically. The problem is that recently courts have thrown out foreclosures because MERS has no legal standing since they are neither the maker of the note nor a beneficiary.
Watch this video of Rep Grayson.
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Thanks for passing along the video. Interesting perspective.
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