A New Hampshire Superior Court is the latest to strike down a move by a homeowner to paint the Mortgage Electronic Registration Systems, or MERS, as an outlier that created a cloud on title during the loan securitization process.
The case proves one thing: MERS may not always win in court, but when it comes to court opinions where MERS has to assert the registry maintains certain rights as the contractual nominee for a lender and any subsequent lenders assigned the note, MERS has developed a reputation for winning in court.
In the latest case, Bennett v. MERS, the New Hampshire Superior Court agreed to dismiss a quiet title action by a homeowner, who claimed MERS transfer of the note was not recorded, clouding his title.
But the court disagreed, finding that everything giving MERS authority to transfer the note and foreclosure rights is in the original contract, which was filed well before the default.
“The mortgage says the note may be sold to MERS,”” Justice Brian Tucker wrote. “Moreover, the mortgage says the note may be sold and that MERS will remain a mortgagee for Metrocities ‘successors and assigns.”
In his opinion, the justice added, “Since the holder of the note and the holder of the mortgage were split from each other at the outset, the parties understood that the mortgagee and the holder of the note would not be the same.”
This determination led to a dismissal of the homeowner’s complaint.
