Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Has anyone ever come across MERS as a defendant even though they are a nominee in the mortgage????

I am confused... Why is that???

Thanks in advance.

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     This happens because very often double loans were made against a property in order to mortgage it at 100% Loan to value. The first mortgage would be for 80% LTV and the second loan would be 20% LTV. Both the first and the second Notes were securitized and MERS was the Nominee for the
lender on both the first mortgage and the second mortgage.
     When the first mortgage is foreclosed, the owner or nominee of the owner
of the second mortgage must be served with the papers as a defendant of their second position. If the second mortgage holder is not served, then their
equity position in the property would not be extinquished and the first mortgage holder would take the property subject to the second mortgage.
Even though the original Notes were owned by the same lender, they part
company during the securitization process and change hands many times
like "baseball cards". This is where MERS comes in, they are supposed to inform the second Note holder of the foreclosure action by the first note
holder so they can protect their equity in the property.
      The recent Kansas decision goes against this concept by saying MERS
in second position doesn't need to be served. Personally I don't agree with
that decision, but I'm just a paralegal! My opinion only!
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