MERS Reaches 40 Million Loan Milestone on Registry
IndyMac Bank has registered the 40 millionth loan on MERS (Mortgage Electronic Registry Systems) for tracking beneficial interests in mortgage loans and mortgage servicing rights.
"When MERS began registering loans on the system, we cautiously believed that perhaps we would reach that number in 10 or 12 years," said MERS president and CEO R.K. Arnold in a news release. "But it's only been eight years since the registration of the first MOM loan." MOM stands for MERS as original mortgagee.
In a report released by The Tower Group, the MERS System for residential loans showed the fastest rate of adoption of all recent and commonly used technologies.
Forty million loans represents a 33% increase in the number of loans registered on the system since April 2005. To date, 29 of the top 30 mortgage lenders in the industry utilize MERS to eliminate the need to file assignments when trading loans.
"In the beginning, because MERS was so new and so innovative, we really had to work hard to explain our value to the industry," Mr. Arnold said. "But there were a few visionaries who saw how MERS could save them considerable time and money. Those companies led the way into transforming MERS into a standard of doing business in the industry."
MERS is an industry utility created to design and operate an electronic loan registry that eliminates the need for assignments when trading mortgage loans. Borrowers name MERS as mortgagee and nominee for the lender on deeds of trust and mortgages that are recorded in the county land records. Lenders then register the loans on MERS and electronically track changes in servicing and beneficial ownership rights over the life of the loan.
The company's vision is to one day eliminate all paper from the mortgage lending process. To date, it has launched several products in support of this vision, including MERS Commercial for the CMBS marketplace, and the MERS eRegistry, a system of record that identifies the owner (controller) and custodian (location) for registered e-notes, providing greater liquidity, transferability and security for lenders.
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