Alaska Supreme Court Affirms MERS’ Authority to Assign Trust Deed
MERS has Right to Take Action as Beneficiary
FOR IMMEDIATE RELEASE
CONTACT: Janis Smith
Reston, Virginia, April 3, 2014—MERSCORP Holdings, Inc. today announced that the Supreme Court of the State of Alaska affirmed the trial court’s decision validating MERS’ status as trust deed beneficiary and upholding the non-judicial foreclosure proceeding related to plaintiff’s property.
In pdf Espeland v. OneWest Bank (192 KB) , the plaintiffs’ cause of action seeking to void the trustee sale was based on several grounds, most notably that the MERS assignment of the trust deed to the foreclosing party, IndyMac Federal Bank, FSB (“IndyMac”) was invalid because MERS never held an interest in the underlying promissory note. The plaintiffs further alleged that IndyMac, the assignee of the MERS assignment, lacked the authority to appoint the successor trustee who conducted the foreclosure sale.
In affirming the trial court’s decision the Supreme Court found no defects in the chain of title which would have prevented the successor trustee from conducting the non-judicial foreclosure. Quoting directly from the subject MERS deed of trust, the Supreme Court found that the deed of trust granted MERS “the right to take any action of [the] Lender. Accordingly, the Court ruled that MERS “had the power to assign the Deed of Trust” and thereby transfer its interest to IndyMac.
“The Supreme Court of the State of Alaska affirms that MERS, as trust deed beneficiary possesses the power to assign the deed of trust and the authority to take any action the actual lender could have taken,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith. “And further,” she said, “this authority is granted by plain language in the mortgage document signed at closing by the borrower.”
For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org.
MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS® System and all other MERS® products. It is a member-based organization made up of thousands of lenders, servicers, sub-servicers, investors and government institutions. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.