Massachusetts Bankruptcy Judge Rules MERS Can Foreclose
A federal bankruptcy judge in the District of Massachusetts joins the list of other courts in Massachusetts that have held that Mortgage Electronic Registration Systems, Inc. (also known as MERS) has legal authority to foreclose, regardless of whether it can produce a note assigned to it or not.
In this case, the homeowners’ trustee objected to a request by the bank, HSBC, for permission to foreclose. Deciding in favor of the bank, the court wrote that although “MERS does not own any of the mortgage loans associated with the mortgages,” it nonetheless is not required to do so to foreclose. Rather, simply because it had an assignment of the mortgage, it met the statutory requirement for foreclosure. “The fact that the debtors’ promissory note passed like a hot potato down a line of owners, including some in bankruptcy and liquidation, with no accompanying assignment of the note owner’s beneficial interest in the mortgage, changes nothing.”
This decision is one of a number of other recent decisions that have further diminished the legal rights of homeowners in Massachusetts with respect to foreclosure.
The case is In re: Marron.