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Procedures Manual

Release 23.0

Effective Date: December 10, 2012


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Contents

INTRODUCTION .......................................................................................................................... 1

PURPOSE ......................................................................................................................................... 1

STRUCTURE ...................................................................................................................................... 1

MEMBERSHIP IN THE MERS

SYSTEM ......................................................................................... 3

OVERVIEW ....................................................................................................................................... 3

IMPACT............................................................................................................................................ 3

BUSINESS PROCEDUREMEMBER INTEGRATION ..................................................................................... 3

BUSINESS PROCEDURE USING A THIRD PARTY ORIGINATOR.................................................................... 4

BUSINESS PROCEDUREMEMBER RESIGNATION..................................................................................... 5

REPORTS.......................................................................................................................................... 6

SYSTEM SECURITY ...................................................................................................................... 7

OVERVIEW ....................................................................................................................................... 7

Org ID Overview...................................................................................................................... 8

IMPACT............................................................................................................................................ 8

BUSINESS PROCEDUREMERSCORPHOLDINGS ................................................................................... 9

BUSINESS PROCEDUREMEMBER........................................................................................................ 9

BUSINESS PROCEDUREWHEN USING THIRD PARTY SERVICE PROVIDERS.................................................. 11

BUSINESS PROCEDUREASSOCIATED MEMBER .................................................................................... 11

REPORTS........................................................................................................................................ 12

BUSINESS PROCEDURE MY MERS................................................................................................. 12

BUSINESS PROCEDURE TRANSACTION DEFAULT SETTINGS ................................................................... 13

REPORTS........................................................................................................................................ 14

MEMBER INFORMATION .......................................................................................................... 15

OVERVIEW ..................................................................................................................................... 15

IMPACT.......................................................................................................................................... 16

BUSINESS PROCEDUREMEMBER...................................................................................................... 16


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BUSINESS PROCEDUREMERSCORPHOLDINGS ................................................................................. 19

REPORTS........................................................................................................................................ 20

BUSINESS PROCEDURE -MEMBER LOCKOUT ......................................................................................... 20

BUSINESS PROCEDURE -MEMBER NODDISPUTE .................................................................................. 20

REPORTS........................................................................................................................................ 21

MEMBER CORPORATE NAME CHANGES ................................................................................... 22

OVERVIEW ..................................................................................................................................... 22

IMPACT.......................................................................................................................................... 22

BUSINESS PROCEDURE ...................................................................................................................... 22

REPORTS........................................................................................................................................ 23

MORTGAGE IDENTIFICATION NUMBER (MIN) .......................................................................... 24

OVERVIEW ..................................................................................................................................... 24

IMPACT.......................................................................................................................................... 25

BUSINESS PROCEDURE FOR CREATING A MIN ....................................................................................... 25

MOM AND NON-MOM LOAN REGISTRATION ........................................................................... 28

OVERVIEW ..................................................................................................................................... 28

IMPACT.......................................................................................................................................... 29

BUSINESS PROCEDUREINITIAL REGISTRATION..................................................................................... 30

BUSINESS PROCEDUREPOST-CLOSING REGISTRATION.......................................................................... 33

BUSINESS PROCEDURE RE-REGISTRATION AFTER REVERSAL ................................................................... 34

BUSINESS PROCEDURE RE-REGISTRATION AFTER DEACTIVATION ............................................................ 35

REPORTS........................................................................................................................................ 37

IREGISTRATION......................................................................................................................... 38

OVERVIEW ..................................................................................................................................... 38

IMPACT.......................................................................................................................................... 39

BUSINESS PROCEDURE IREGISTRATION.............................................................................................. 39

BUSINESS PROCEDUREPOST-CLOSING IREGISTRATION ......................................................................... 42

BUSINESS PROCEDURE IREGISTRATION AFTER REVERSAL ....................................................................... 43


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BUSINESS PROCEDURE IREGISTRATION AFTER DEACTIVATION................................................................. 45

REPORTS........................................................................................................................................ 46

CONVERSION FROM IREGISTRATION TO NON-MOM ................................................................ 47

OVERVIEW ..................................................................................................................................... 47

IMPACT.......................................................................................................................................... 47


REPORTS........................................................................................................................................ 49

PRE-CLOSING REGISTRATION .................................................................................................... 50

OVERVIEW ..................................................................................................................................... 50

IMPACT.......................................................................................................................................... 50

BUSINESS PROCEDUREPRE-CLOSING ................................................................................................ 51

BUSINESS PROCEDUREPRE-CLOSING AFTER REVERSAL ......................................................................... 53

REPORTS........................................................................................................................................ 55

REGISTRATION REVERSAL ......................................................................................................... 56

OVERVIEW ..................................................................................................................................... 56

IMPACT.......................................................................................................................................... 56


REPORTS........................................................................................................................................ 57

REVERSE MORTGAGE PROCESSING........................................................................................... 58

OVERVIEW ..................................................................................................................................... 58

IMPACT.......................................................................................................................................... 58


CONSTRUCTION LOAN PROCESSING ......................................................................................... 59

OVERVIEW ..................................................................................................................................... 59

IMPACT.......................................................................................................................................... 59

BUSINESS PROCEDUREONE-STEP CLOSING ......................................................................................... 59

Closed on a MOM Security Instrument ................................................................................... 59

Closed on a Standard Security Instrument and Assigned to MERS ......................................... 60


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Closed on a Standard Security Instrument and Not Assigned to MERS (iRegistration) .......... 61

BUSINESS PROCEDURETWO-STEPCLOSING .............................................................................. 62

REGISTERED LOANS IN RATED SECURITIES ................................................................................ 64

OVERVIEW ..................................................................................................................................... 64

IMPACT.......................................................................................................................................... 64


REPORTS........................................................................................................................................ 65

TRANSFER OF BENEFICIAL RIGHTS ............................................................................................ 66

OVERVIEW ..................................................................................................................................... 66

TRANSFER OF BENEFICIAL RIGHTS ....................................................................................................... 67

Overview ................................................................................................................................. 67

Option 1 ............................................................................................................................................ 67

Option 2 ............................................................................................................................................ 68

Impact..................................................................................................................................... 71

Business ProcedureOption 1 ............................................................................................... 71

Business ProcedureOption 2 ............................................................................................... 72

Processing ............................................................................................................................... 73

Reports................................................................................................................................... 75

TRANSFER OF BENEFICIAL RIGHTS TO NON-MEMBER INVESTORS.............................................................. 76

Overview ................................................................................................................................. 76

Impact .................................................................................................................................... 76

Business Procedure ................................................................................................................. 76

Reports ................................................................................................................................... 77

REMOVING INTERIM FUNDER SECURITY INTERESTS ................................................................. 78

OVERVIEW ..................................................................................................................................... 78

IMPACT.......................................................................................................................................... 78

BUSINESS PROCEDURETOBOPTION 1 ............................................................................................. 79



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REPORTS........................................................................................................................................ 80

REMOVING WAREHOUSE/GESTATION LENDER SECURITY INTERESTS ....................................... 81

OVERVIEW ..................................................................................................................................... 81

IMPACT.......................................................................................................................................... 81



REPORTS........................................................................................................................................ 83

TRANSFER OF SERVICING RIGHTS ............................................................................................. 84

OVERVIEW ..................................................................................................................................... 84

IMPACT.......................................................................................................................................... 86

FLOW TRANSFER OF SERVICING RIGHTS................................................................................................ 88

Note Date ......................................................................................................................................... 88

Sale Date/Transfer Date ................................................................................................................... 89

No Investor Confirmation of Flow Transfer of Servicing ................................................................... 89

SEASONED TRANSFER OF SERVICING RIGHTS ......................................................................................... 89

Note Date ......................................................................................................................................... 89

Sale Date and Transfer Date ............................................................................................................. 90

Investor Confirmation ....................................................................................................................... 90

Involuntary Transfer/Default by ServicerLoans transferred to a MERSSystemMember90

Involuntary Transfer/Default by ServicerLoans transferred to a non-Member Servicer.... 92

PROCESSING................................................................................................................................... 93


REPORTS........................................................................................................................................ 96

TOS/TOB COMBINATION .......................................................................................................... 97

OVERVIEW ..................................................................................................................................... 97

IMPACT.......................................................................................................................................... 97

TRANSFER DATES............................................................................................................................. 98

BUSINESS PROCEDURE .................................................................................................................... 100


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REPORTS...................................................................................................................................... 101

DEACTIVATIONS ..................................................................................................................... 103

OVERVIEW ................................................................................................................................... 103

DEFAULT BY SERVICER .................................................................................................................... 103

Impact .................................................................................................................................. 103

Business Procedure ............................................................................................................... 104

Reports ................................................................................................................................. 104

FORECLOSURE AND BANKRUPTCY...................................................................................................... 105

Overview ............................................................................................................................... 105

MOM and Non-MOM Loans ........................................................................................................... 105

iRegistration Loans......................................................................................................................... 106

Foreclosure and MIN Deactivation................................................................................................. 107

Impact .................................................................................................................................. 107

Business Procedure ............................................................................................................... 108

Reports ................................................................................................................................. 108

PAID IN FULL (INCLUDES SHORT SALES,DEEDS IN LIEU, AND CHARGE OFFS NOT ASSOCIATED WITH A FORECLOSURE

COMPLETION) ............................................................................................................................... 109

Overview ............................................................................................................................... 109

Impact .................................................................................................................................. 109

Business ProcedurePaid in Full ....................................................................................... 110

Reports................................................................................................................................. 110

TRANSFER TO NON-MERSSTATUS ................................................................................................... 111

Overview ............................................................................................................................... 111

Impact .................................................................................................................................. 111

Business ProcedureTransfer to Non-MERS Status ............................................................ 111

Reports ................................................................................................................................. 112

DEACTIVATION REVERSALS..................................................................................................... 113

OVERVIEW ................................................................................................................................... 113


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IMPACT........................................................................................................................................ 113


REPORTS...................................................................................................................................... 114

MODIFICATION AGREEMENTS ................................................................................................ 115

OVERVIEW ................................................................................................................................... 115

IMPACT........................................................................................................................................ 115


REPORTS...................................................................................................................................... 116

CONSOLIDATION, EXTENSION, AND MODIFICATION AGREEMENT (CEMA) ............................. 117

OVERVIEW ................................................................................................................................... 117

IMPACT........................................................................................................................................ 118


REPORTS...................................................................................................................................... 120

ASSUMPTION OF MORTGAGE ................................................................................................ 121

OVERVIEW ................................................................................................................................... 121

IMPACT........................................................................................................................................ 121


REPORTS...................................................................................................................................... 122

PROPERTY PRESERVATION ..................................................................................................... 123

OVERVIEW ................................................................................................................................... 123

IMPACT........................................................................................................................................ 124


REPORTS...................................................................................................................................... 125

REPORTING ............................................................................................................................ 126

OVERVIEW ................................................................................................................................... 126

IMPACT........................................................................................................................................ 127

BUSINESS PROCEDURERETRIEVING REPORTS.................................................................................... 128

BUSINESS PROCEDUREREQUESTING A PORTFOLIO ANALYSIS REPORT.................................................... 128


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REPORTS...................................................................................................................................... 130

MERSCORP HOLDINGS MAIL SERVICES ................................................................................... 131

OVERVIEW ................................................................................................................................... 131

IMPACT........................................................................................................................................ 132


REPORTS...................................................................................................................................... 134

MERSCORP HOLDINGS HELP DESK .......................................................................................... 135

OVERVIEW ................................................................................................................................... 135

IMPACT........................................................................................................................................ 136

BUSINESS PROCEDUREHELP DESK.................................................................................................. 136

Initiate Problem Resolution............................................................................................................ 137

BUSINESS PROCEDURE -MERSSERVICERID ...................................................................................... 137

BUSINESS PROCEDURE -SERVICER IDENTIFICATIONSYSTEM (SIS) ............................................................ 138

BUSINESS PROCEDUREMERSLINK............................................................................................... 139

BUSINESS PROCEDUREXMLINQUIRY ............................................................................................. 140

BUSINESS PROCEDUREBATCH INQUIRY ........................................................................................... 141

REPORTS

...................................................................................................................................... 142

CORPORATE RESOLUTION MANAGEMENT SYSTEM (CRMS) ................................................... 143

OVERVIEW ................................................................................................................................... 143

IMPACT........................................................................................................................................ 144

BUSINESS PROCEDURE -INITIAL REQUEST FOR MERSCORPORATE RESOLUTION........................................ 144

BUSINESS PROCEDURE -MERSSIGNING OFFICER CERTIFICATION........................................................... 146

BUSINESS PROCEDURE -VIEW ONLY CONTACTS................................................................................... 149

BUSINESS PROCEDURE -PASSWORD CHANGES AND RESETS ................................................................... 149

BUSINESS PROCEDURE -MERSSIGNING OFFICER RECERTIFICATION........................................................ 151

BUSINESS PROCEDURE -MAINTAINING MERSSIGNING OFFICER INFORMATION........................................ 153

Removing a MERS Signing Officer from a CR ....................................................................... 153

Updating a MERS Signing Officers Information ................................................................... 154


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Adding a MERS Signing Officer ............................................................................................. 154

BUSINESS PROCEDURE -UPDATING THE MERSPROJECT MANAGER ...................................................... 156

BUSINESS PROCEDURESIGNING AUTHORITY AGREEMENTS.................................................................. 157

BUSINESS PROCEDURERULE 3EXCEPTIONS...................................................................................... 159

BUSINESS PROCEDURESTATUS CHANGES......................................................................................... 160

Change to Resigned Status................................................................................................ 160

Reactivation after Resigned Status ................................................................................... 160

QUARTERLY ATTESTATION REQUIREMENT........................................................................................... 161

MERSCORPORATE SEALS............................................................................................................... 162

SIGNING OFFICER BEST PRACTICES .................................................................................................... 163

REPORTS...................................................................................................................................... 164

QUALITY ASSURANCE POLICY ................................................................................................. 165

OVERVIEW ................................................................................................................................... 165

IMPACT........................................................................................................................................ 165

STRATEGY .................................................................................................................................... 166

QUALITY ASSURANCE PLAN ............................................................................................................. 166

MONITORING ............................................................................................................................... 167

ANNUAL REPORT........................................................................................................................... 168

Requirements: ...................................................................................................................... 169

QUALITY ASSURANCE STANDARDS ......................................................................................... 171

OVERVIEW ................................................................................................................................... 171

MERS AS ORIGINAL MORTGAGEE (MOM) SECURITY INSTRUMENT PROCESSING STANDARDS..................... 171

NON-MOMPROCESSING STANDARDS .............................................................................................. 172

IREGISTRATION PROCESSING STANDARDS ........................................................................................... 173

ADDITIONAL RECORDABLE DOCUMENTS PROCESSING STANDARDS ......................................................... 173

LOAN INFORMATION PROCESSING STANDARDS.................................................................................... 173

LIEN RELEASE PROCESSING STANDARDS ............................................................................................. 174


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FORECLOSURE PROCESSING STANDARDS ............................................................................................ 174

BANKRUPTCY PROCESSING STANDARDS.............................................................................................. 175

DEACTIVATION PROCESSING STANDARDS............................................................................................ 175

MEMBER INFORMATION UPDATE STANDARDS..................................................................................... 175

SERVICE OF PROCESS STANDARDS ..................................................................................................... 176

CORPORATE RESOLUTION MANAGEMENT SYSTEM (CRMS)UPDATE STANDARDS ...................................... 176

DATA INTEGRITY STANDARDS ........................................................................................................... 177

DATA RECONCILIATIONSTANDARDS .................................................................................................. 179

Loan Information .................................................................................................................. 179

Member Information on the MERS System ........................................................................ 181

MERS Signing Officer Information on the CRMS: ................................................................. 181

Loans reflected on the MINs for the Same Primary Borrower SSN, Property and First Lien

Monthly (RI) Report: ............................................................................................................. 182

Member Reconciliation Extract (MRE) ................................................................................. 182

Quarterly Reconciliation Extract (QRE) ................................................................................. 183

Reconciliation of MINs Naming a Resigning Member .......................................................... 183

QUALITY ASSURANCE REVIEW ................................................................................................ 185

CHECKLIST ITEMS ........................................................................................................................... 185

MOM Security Instrument Document Review ...................................................................... 185

Non-MOM Document Review ............................................................................................... 186

iRegistration Document Review ........................................................................................... 186

Lien Release Document Review ............................................................................................ 187

Foreclosure Document Review ............................................................................................. 187

Bankruptcy Document Review.............................................................................................. 188

ADDITIONAL LEGAL-SPECIFIC GUIDELINES FOR DOCUMENT REVIEWS..................................... 189

MERS Signing Officer Name ............................................................................................................ 189

MERS Signing Officer Title............................................................................................................... 190

Date Discrepancies ......................................................................................................................... 190


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MERS is Accurately Described in the Document ............................................................................. 191

MERS Corporate Seal ...................................................................................................................... 191

If the Document is an Assignment .................................................................................................. 192

DATA INTEGRITY REVIEW......................................................................................................... 192

MEMBER INFORMATION REVIEW............................................................................................... 193

Sample Documents for MOM Loans and Loans Assigned to MERS.................................... 194

SAMPLE CHANGES TO DEED OFTRUST OR MORTGAGE NAMINGMERSAS THE ORIGINAL

MORTGAGEE (MOMDOCUMENT)............................................................................................. 195

Sample Documents............................................................................................................... 196

GLOSSARY .............................................................................................................................. 197


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System Procedu res Manual Release 23.0 12/10/2012 Introduc tion 1

Introduction

Purpose

This manual serves as an overview of how business processes in

mortgage banking are affected by the MERSSystem policies and

procedures, and details the MERSSystem requirements for Quality

Assurance. This information will help you assess the impact of the

MERSSystem on your own business and business processes. Use

this manual in conjunction with other sources of instruction and

guidelines, including, but not limited to the following:

MERS OnLine User GuideGives step-by-step instruction for using MERSOnLine

MERS Integration Handbook, Volume I

Provides detailed information on becoming MERSReady

MERS Integration Handbook Volume II

Provides the technical specifications for interacting with

the MERSSystem. This manual is of most use to

Members that send flat file or EDI X12 transmissions.

MERS

System Reports HandbookProvides descriptions of available MERSReports

MERS EDI Implementation Guide

For Members who are using the EDI X12 interface

These documents are available from the MERSCORP Holdings, Inc.

(MERSCORP Holdings) member websitemembers.mersinc.org.

Note that the Servicer named on the MERSSystem is responsible

for compliance with all MERSSystem Procedures. If the Servicer

names a Subservicer on the MERS

System, the Subservicer mustalso comply with all MERSSystem Procedures; however, the

Servicer remains responsible for compliance.

Structure

Each chapter contains four parts:
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System Procedu res Manual Release 23.0 12/10/2012 Introduc tion 2

Overview. The overview gives a brief description of the

process or function and how it relates to the MERS

System.

Impact. The impact states what types of organizations the

process affects.

Business Procedures. The business procedure gives a step-

by-step view of the process, including business-related

steps and general MERSSystem instruction. The

business procedure lists information thatcanbe entered

onto the MERSSystem, as well as what information is

required by the MERS System Quality Assurance

Standards. Specific system instruction, including system-

required fields, is found in theMERS OnLine User Guide,

Chapter 18 -Reports. This section lists reports produced

during the business process. For a detailed description of

each report, see theMERS System Reports Handbook.
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System Procedu res Manual Release 23.0 12/10/2012 Membershi p in the MERS System 3

Membership in the MERS

System

OverviewParticipants from all sectors of the real estate finance industry have

varying levels of access to and use of the MERSSystem. These

participants include lenders, investors, servicers, brokers,

custodians, and title companies. Some participants are Members;

some are not, depending on their needs. Each Member goes

through an application and approval process, which is outlined in

the following pages, to become a Member of the MERSSystem.

ImpactThis process has potential impact on all new MERSSystem

Members.

Business Procedure Member Integration1. Submit a completed MERSSystem application to

MERSCORP Holdings, Inc. Offices.

You will be assigned an Org ID

The MERSCORP Holdings Membership Team will

work with you on preliminary steps to get you ready foryour MERSSystem integration, including:

o Identify an implementation Project Manager

o Form an integration team

o Notify technology vendors of your intention to

become a MERSSystem Member

o Notify investors, document custodians, andwarehouse gestation lenders of your intentions

to become a MERSSystem Member

o Set a target implementation dateo Determine if new business partner

agreements are needed

Once these preliminary steps are done, the MembershipManager will recommend your company for

integration.

2. During integration, you will:

For more detailed information

regarding technical requirements

and network connectivity, refer to

theMERS

Integration Handbook

Volume II, which is available on

our member website at

members.mersinc.org. The

MERS

EDI Implementation Guide

is also available on the

website.
https://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/https://members.mersinc.org/https://members.mersinc.org/files/filedownload.aspx?id=242&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=242&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=242&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=242&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=242&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=242&table=ProductFilehttps://members.mersinc.org/https://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=235&table=ProductFile


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Confirm your implementation date

Confirm your document preparation system has

appropriate language regarding Mortgage Electronic

Registration Systems, Inc. (MERS)

Confirm you can generate a valid MIN

Document your revised MERS System process flows

Determine your system access and security levels in

accordance with your line of business and transaction

requirements

Install system interfaces to the MERS System, if

needed

Develop the required servicing or origination system

and document preparation enhancements, if needed

Test the required servicing or origination systemenhancements, if needed

Develop and implement a quality assurance program

for the MERS System, and submit your MERS

System quality assurance plan to MERSCORP

Holdings

Attend a MERS OnLine training session

Train your staff on the use of the MERSSystem

3. After integration, you will:

Be given access to the Corporate ResolutionManagement System (CRMS) to propose officers of

your company as MERS Signing Officers

Complete the Customer Integration survey

Business Procedure

Using a Third Party Originator

Any broker or affiliate originating MERS as Original Mortgagee

(MOM) loans must be a MERSSystem Member. You mayregister the loans on the MERSSystem for your broker oraffiliate, but must enter their Org ID in the Originating Org ID

field.

If you buy closed loans from a broker or affiliate who is not aMERSSystem Member, you can have the originator assign eachloan to Mortgage Electronic Registration Systems, Inc. and you


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will need to register the loans on the MERSSystem as Non-MOM, entering the non-Member originators name in the OriginalNote Holder field.

If you purchase a MOM loan that closed after March 31, 2012 by

an originator who has not yet completed the membership processor the system will not accept the Org ID that you are trying toenter, you can use a value of1011001 (Originating Org IDException) in the Originating Org ID field as a placeholder toregister the loan, but you must update the loan with the correct OrgID within 60 calendar days. This placeholder Org ID is consideredan exception for reconciliation and data reviews.

Business Procedure Member Resignation

1. Member wishing to resign their membership provideswritten notification of the members intent to resign.

Request may be mailed, e-mailed, or faxed to:

MERSCORP Holdings, Inc.

1818 Library Street, Suite 300

Reston, VA 20190

[email protected]

Fax: (703) 748-0183

If the resigning companys membership was never

activated and no active loans reflect its Org ID on theMERS System, the resignation will be finalized within 10

days of receipt of the written request.

2. MERSCORP Holdings advises resigning Member of active

loans on the MERS System still listing their Org ID as a

rights holder.

3. For all active loans listing the resigning Org ID as Servicer

or Subservicer, within 30 calendar days the resigning

Member either:

Sells the loan to a MERS System Member and

completes the transaction(s) on the MERS System to

reflect the transfer

or

Assigns the mortgage/deed of trust out of the name of

Mortgage Electronic Registration Systems, Inc.
mailto:[email protected]:[email protected]:[email protected]


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(MERS) by preparing and recording an assignment in

the applicable land records, and deactivates the loan

from the MERS System using a Transfer to Non-

MERS Status deactivation transaction.

4. For all active loans listing the resigning Org ID in any other

rights holder field, the resigning Member contacts the

Servicer/Subservicer of those loans to remove resigning

Member as a rights holder within 30 calendar days.

5. If Member is still named as a rights holder on any active

loan after 30 days, MERSCORP Holdings may update the

MERS System on behalf of the resigning member by

locating the servicer and/or investor related to the

applicable mortgage loans. Any costs associated with

finding this information are charged to the resigning

Member.

6. Until the resignation process is complete, the resigning

Member remains responsible for all annual membership

fees.

7. To complete the resignation process, Member must pay all

outstanding balances, including any costs associated with

transfer or deactivation transactions or external research.

8. The resigning Member remains responsible for respondingto any service of process forwarded to their organization as

a result of mail received by the MERSCORP Holdings

Mail Center on their behalf.

9. Members wishing to claim loans registered to the resigning

Member may use the certificate process described in

Reconciliation of MINs Naming a Resigning Member

section.

ReportsNo reports are associated with obtaining or resigning your MERS

System membership.


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System Procedu res Manual Release 23.0 12/10/2012 System Securi ty 7

System Security

Overview

There are three levels of identity validation within the MERS

System security scheme:

Org ID

User ID

User Password

Any attempt to access the MERSSystem is denied unless all

three tiers of security have been satisfied. MERSCORP Holdings

assigns your Org ID, which identifies your organization, whenyour membership application is approved. At the Org ID level, the

MERSSystem stores your Member Information (lines of

business, contact information, etc.).

Your Lines of Business (LOBs) under Member Information

determine which of the MERSSystem functions you will be able

to access. For example, a Custodian can only view loans for which

it is the Custodian, and cannot access transfer of beneficial rights

or loan modifications.

Your MERSSystem Administrator is responsible for establishingand maintaining the security that controls access to the MERS

System and specific processes within the MERSSystem. Your

System Administrator establishes User IDs and Passwords and

assigns users to specific roles that enable certain levels of access in

the MERSSystem. The System Administrator also resets

passwords, reactivates User IDs, and deletes unused User IDs.

See theMERS OnLine User Guidefor complete instructions on

setting up and maintaining User IDs and security roles.

As defined by a contractual agreement, your organization may

grant security access to a third party to process specific

transactions (e.g., the MERSSystem Members that are known as

Registrars may be authorized by you to perform registrations,

transfers, updates and deactivations on your behalf) by setting up a

Vendor relationship, but you may assign User IDs only to persons

within your organization.
https://members.mersinc.org/filedownload.aspx?id=93&table=ProductFilehttps://members.mersinc.org/filedownload.aspx?id=93&table=ProductFilehttps://members.mersinc.org/filedownload.aspx?id=93&table=ProductFilehttps://members.mersinc.org/filedownload.aspx?id=93&table=ProductFilehttps://members.mersinc.org/filedownload.aspx?id=93&table=ProductFilehttps://members.mersinc.org/filedownload.aspx?id=93&table=ProductFile


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Org ID Overview

Your Org ID is one of the critical levels of identity validation in

the MERSSystem security scheme.

One of the primary uses of the Org ID value is in theOriginating

Org ID field where it identifies the Member that originated a

MOM loan.

Note: TheOriginal Note Holder field identifies the loan

originator if the originator is not a MERSSystem member.

The MERSSystem enforces the following validations on the Org

ID value entered into theOriginating Org ID field:

It is a required value on all MOM MINs registered after

March 31, 2012. It must be a valid MERSSystem Org ID.

In Registration and Update transactions for MOM, Non-MOM, and iRegistration MINs, the Org ID must belong toa Member that is assigned to least one of the followingLOBs:

Originator Third Party Originator (TPO)

Servicer Subservicer

Investor Originating Org ID Exception

In MOM Registration and Update transactions where theOriginating Org ID belongs to a Member whose Line ofBusiness is exclusively a Third Party Originator, theMember's Status must be "Active". As a result of thischange, attempts to submit an inactive TPO Org ID in theOriginating Org ID field either at Registration or via MINUpdate will reject.

Impact

The security process affects the following organizations:

All MERSSystem Members

MERSCORP Holdings Offices


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Business ProcedureMERSCORP Holdings

Your Business Integration Resource (BIR) enters the following

information on the MERSSystem regarding your organization.

Org ID

Company Name

Corporate Address

Phone

Fax

Corporate website address

Parent company, if applicable

FHA approved indicator

(Notify MERSCORP Holdings if this information changes;

only MERSCORP Holdings can change this indicator onthe MERSSystem)

Agency ID(s)

(Notify MERSCORP Holdings if this information changes;

only MERSCORP Holdings can change Agency IDs on the

MERSSystem)

Organizations Line(s) of Business

Contact information

Membership date

Your BIR also provides the MERSCORP Holdings Help Desk andMail Room with the email address you provide for official notices,

including service of process we receive on your behalf. If this

email address changes, you must notify the Help Desk

immediately.

Business ProcedureMember

1. Your MERSSystem Project Manager identifies a MERS

System Administrator, who is responsible for the following

tasks:

Assigning each user within your organization a unique

User ID on the MERSSystem.

Assigning a security role to each User ID.

Resetting passwords, deactivating User IDs and

deleting User IDs and Security Roles no longer needed.


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Providing access to the appropriate individual(s) in

your organization who will maintain your Member

Information section of MERSOnLine including

Address, Phone/Fax numbers, URL Address and

Contact List.

Giving authority to third party providers so they can

perform specific functions on behalf of your company

by setting up a Vendor relationship, but no third party

may be provided a User ID under your Org ID.

2. After your Business Integration Resource (BIR) has set up

and activated your company on the MERSSystem, your

Operational Contact (or other designated party) is

responsible for maintaining the accuracy of your data, and

notifying MERSCORP Holdings if certain information

changes.

3. Your organization is responsible for keeping the following

information current once your organization is activated on

the MERSSystem:

Company Name

(Notify MERSCORP Holdings if this information

changes; only MERSCORP Holdings can change

Company Name on the MERSSystem)

Corporate Address(Also notify MERSCORP Holdings if this changes)

Phone (Also notify MERSCORP Holdings if this

changes)

Fax (Also notify MERSCORP Holdings if this changes)

Corporate website address

Investor Alternate Address and Indicator

Servicer/Subservicer Alternate Address and Indicator

Contact information

(Also notify MERSCORP Holdings if primary contact

changes.)

For the items where it states to notify MERSCORP

Holdings, do so by using theCompany Information Change

Requestform available on the corporate website.
https://members.mersinc.org/files/filedownload.aspx?id=307&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=307&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=307&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=307&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=307&table=ProductFilehttps://members.mersinc.org/files/filedownload.aspx?id=307&table=ProductFile


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If the email address to which official notices for your organization

should be sent changes, you must notify the Help Desk

immediately.

Business ProcedureWhen Using ThirdParty Service Providers

Your organization may grant security access to the MERS System

to third parties to process transactions on your behalf.

Your System Administrator sets up this security through the

Member Information Relationships section of MERSOnLine by

adding Vendor relationships. The transactions that may be

processed by these vendors are:

Registrations

Transfers

Deactivations

Updates

Inquiries

You may not set up a User ID under your Org ID for a third

party.

Business Procedure Associated MemberThe MERSSystem provides all Associated Members a central

point to obtain information on a MIN (i.e. current Servicer, current

Investor, Assignment information) with which they are associated.

Any Member can be identified as an Associated Member on a

MIN, provided it is an active MERSSystem Member with a valid

Org ID. The following Lines of Business (LOBs) define

Associated Members on the MERSSystem:

Collateral Agent

FHLB/FRB

Government Housing Agency

Master Servicer

Mortgage Insurance Co.

Trustee

Warehouse/Gestation Lender


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Property Preservation Company

Other

At the MIN level, the Servicer or Subservicer may identify the

following types of Associated Members: Collateral Agent

FHLB/FRB

Government Housing Agency

Master Servicer

Mortgage Insurance Company

Trustee


Alternate Custodian 1-4

Participation Investor 1-4

Other 1-4 Property Preservation Company 1-4

Reports

The following reports will list Associated Member interest on

MINs from updates received from both batch processing (Flat

File/X12) and MERSOnLine. For detailed descriptions of these

reports, see theMERS System Reports Handbook:

Change Notification Report (VB) MIN Milestone Report (VA)

Registration Rejects/Warning Report (RG)

Seasoned Registration Rejects/Warning Report (RB)

Maintenance Rejects/Warning Report (MB)

Business Procedure My MERS

The MERSSystem provides you the ability to customize the list

of organizations that appear within the pop-up lists on theRegistration, Transfer of Beneficial Rights, Transfer of Servicing

Rights and MIN Information windows through the use of My

MERS. This enables you to see only the list of organizations with

which you currently do business. To customize the pop-up lists,

you must define those relationships within your profile and turn on

the My MERSoption.
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Within the Relationships section of the Member Information, you

can select which relationship to view, create or delete. The

different types will appear at the top of the Relationships page in

alphabetical order and include:

Collateral Agent

Custodian

FHLB/FRB

Government Housing

Interim Funder

Investor

Master Servicer

Mortgage Insurance Company

Other

Property Preservation Company Servicer

Subservicer

Trustee

Vendor

(also included to incorporate Third Party security functionality)


Active Members with a line of business equal to the selected

Relationship Type will appear in the pop-up list. (Inactive

Members will not appear in the pop up list.) The MERSSystem

Lite Members will not show on pop-up Org ID lists on a

registration or transfer transaction because it is unlikely another

Member will name a Lite Member. Lite Members can, however,

be named in these transactions.

When you have defined your Member Information Relationships,

use the Member Information My MERSoption to turn on this

option. The system will not allow you to turn on the My MERS

functionality if your organization has a Vendor Line of Business.

Business Procedure Transaction DefaultSettings

You can also define default values for the rights holders and option

selections that appear on the Registration, Create TOS, and Create

TOS/TOB pages in MERSOnLine, using the Member

Information Transaction Default Settings option.


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Registration Settingsallow you to enter the lien type, MOM

indicator, Pre-Closing indicator, rights holder Org IDs, and

Originating Organization information you usually enter during

Registration. Once entered in Registration Settings, this

information appears whenever you initiate a new registration, so

you dont need to enter it for each loan. To enter different

information for a particular loan, just enter it as you would if you

hadnt used Registration Settings.

TOS Settingsallow you to enter the rights holder Org IDs you

usually enter when creating a Transfer of Servicing Rights (TOS)

or Transfer of Servicing and Beneficial Rights (TOS/TOB)

transaction. There is also a Delete Current Custodian Option.

Once entered in TOS Settings, this information appears whenever

you initiate a new transfer transaction, so you dont need to enter itfor each transfer. To enter different information for a particular

transfer, you just enter it the same way you would if you hadnt

used TOS Settings.

Reports

There are no reports associated with the My MERSor

Transaction Default Settings process.


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System Procedu res Manual Release 23.0 12/10/2012 Member Information 15

Member Information

Overview

Your organization is required to maintain certain portions of your

Member Information to define processing options, billing

information, document handling, and contact information. Your

MERSSystem Administrator also maintains information that

controls system access and security. Some portions of the Member

Information screens can only be changed by MERSCORP

Holdings.

You may change the information within your Member Informationat any time; however, MERSCORP Holdings recommends that

you designate one person as a contact for these changes, generally

your Operational Contact.

Besides maintaining your Member Information on the MERS

System, you are responsible for notifying MERSCORP Holdings

when there is a change to your corporate name, address, telephone

or fax number. You can use theCompany Information Change

Requestform available on the corporate website to notify

MERSCORP Holdings of these changes. You are also responsible

for notifying the Help Desk if your email address for document

images and official notices needs to be changed.

Notification requirements for corporate name changes are

described in theMember Corporate Name Changeschapter. Your

notification of address changes should include:

Org ID

Organization Name

Member Type (General, Lite, or Patron)

Other Org IDs affected by change

Name, title, and email address of contact submitting

notification

Old address

New address

Which offices/contacts are affected

Effective Date


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If email address is changing:

o Old email address

o New email address

o Effective Date

If telephone or fax number is changing:

o Old number

o New number

o Effective Date

Impact

The maintenance of the Member Information affects all

MERSSystem Members.

Business ProcedureMember

1. You can update the following general information in your

Member Information:

Official Corporate Address

(Used in the Member Summary for your organization)

You must also notify MERSCORP Holdings directly if

this information changes

Regular Address

(Used by the MERSCORP Holdings Mail Center todistribute original mortgage documents received for

your organization)

Overnight Address, carrier and account information

(Used by the MERSCORP Holdings Mail Center to

distribute original mortgage documents received for

your organization if you have chosen to have them

delivered via overnight delivery)

Investor Alternate Address and Telephone

Servicer/Subservicer Alternate Address and Telephone Toll Free Phone number

Corporate Fax number

Corporate Web address

Relationships


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2. You must maintain the following contact information in

your Member Information:

Title

Name

Phone number and extension

Email address

Pager number

Fax number

Address

City

State

Zip code

Contact Type

o Accounts Billing*

Contact designated to receive monthly invoices and

respond to billing inquiries

o Primary System Administrator*

Person responsible for setting up unique User ID for

each person at your company needing access to

MERSOnLine, maintaining your organizations

User IDs and Roles, and resetting passwords

(MERSCORP Holdings Help Desk refers usersecurity requests for your organization to this

contact).

o Secondary System Administrator

Back-up for Primary System Administrator

o Primary Customer Service*

Contact who handles public requests for

information about loans registered on the MERS

System

o

Secondary Customer ServiceBack-up for Primary Customer Service

o Legal*

Contact responsible for coordinating

communication between the MERSCORP Holdings

Law Department and the Members internal law

Your organization is responsible

for keeping all contact names,

addresses, email addresses andtelephone numbers current, and

for notifying MERSCORP Holdings

if your corporate name, address,

or notification email address

changes.

You can designate multiple

contacts for all contact types

except Accounts Billing, Primary

Customer Service and Primary

System Administrator.


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department regarding litigation and other legal

issues

o Operational*

Person(s) responsible for overseeing or conducting

the day-to-day MERSSystem functions and

keeping your Member Information (including

Contacts) current. Appears in the Member

Summary available from Member Search at

members.mersinc.org, MERSOnLine, and

MERSLink

(at least one is required if only one contact of this

type remains, it can be updated but not deleted)

o Property Preservation

Contact responsible for handling propertypreservation for your organization. Appears on

Member Summary in MERSOnLine and MERS

Link for the MERSSystem Members and MERS

Link Subscribers to contact regarding property

maintenance issues

o Quality Assurance Officer*

Contact responsible for the MERSSystem Quality

Assurance

o Mail Room

Contact responsible for handling mail received by

MERSCORP Holdings Mail Center for your

organization

o Executive Sponsor*

The senior executive within your organization under

whose management the MERSSystem operation

falls

o Compliance Officer

Contact responsible for regulatory internal

requirements for your organization

o Technical

Person responsible for providing technical support

to ensure compatibility of your internal system(s)

with the MERSSystem

(Required if using system-to-system interface)


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o eRegistry

Contact for MERSeRegistry questions

(required for MERSeRegistry Members)

*Required contact may be updated, but not deleted.

3. You must maintain the following option information in

your Member Information.

Number of Password Expiration Days. The number of

days before a users password expires.

XML Password.The password used to submitting XML

Registration transactions.

Business ProcedureMERSCORP Holdings

MERSCORP Holdings maintains a portion of your organizationsprofile as well. You can view this information, but you cannot

update it. [email protected] you need MERSCORP

Holdings to update this information.

Member Name

(MERSCORP Holdings requires official notification to

update; seeMember Corporate Name Changes)

Parent Org ID

Lines of business

FHA approval flag

Investor Options

Servicer Options

Subservicer Options

Agency IDs

Document Handling Instructions

Registration by Others flags

(May be used to block other Members from registering a

loan showing your organization as Investor, Servicer, or

Subservicer.)

Automated Password Reset flag

(Allows users to establish challenge questions to be used

to log into the system if they forget their password)

eRegistry and eDelivery Options

If Overnight Mail is

requested, you must

provide MERSCORP

Holdings with your

Corporate Airbill

Number.
mailto:[email protected]:[email protected]:[email protected]:[email protected]


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Reports

No reports are associated with maintaining the Member

Information.

Business Procedure - Member Lockout

One of the sanctions available to MERSCORP Holdings for

violations of the Rules of Membership or Procedures is Member

Lockout.

While the Org ID is locked out:

Member is not able to log on to MERSOnLine

Member cannot perform any transactions on the MERSSystem, including X12 or flat file transactions

Access to the CRMS and authorization of the MERSSigning Officer(s) appointed with respect to the Membersexisting MERS Loans are not affected

Other MERSSystem Members may not perform atransaction on a MIN for which the locked out Member isnamed

Business Procedure - Member NOD

DisputeIn the event an Investor is involved in a dispute with a Warehouse

Lender, Servicer or Subservicer, the Investor can request that

MERSCORP Holdings take action to prevent activity on the

disputed MINs by that Servicer/Subservicer.

1. The Investor will notify MERSCORP Holdings in writing of

the dispute with the Servicer/Subservicer or Warehouse

Lender, and produce proof of ownership.

2. MERSCORP Holdings will process the request within five

business days of receipt.

3. MERSCORP Holdings can process a lockout at any of several

levels:

Lockout all activity for an Org ID

Lockout all activity for a specified LOB for an Org ID


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4. Regardless of the lockout level, all Org IDs associated with

impacted MINs can view MIN information. Also, a transfer

transaction will be allowed if it transfers the MIN out of the

relationship between the Member in troubled status and the

disputing Member.

5. The Investor will notify MERSCORP Holdings when the

dispute is settled and when the restriction to system or MIN

access for that Servicer/Subservicer can be reactivated.

Reports

Error messages appear on the following reports for processing that

was stopped due to a Servicer being locked out. For detailed

descriptions of these reports, see theMERS System Reports

Handbook:

Seasoned Registration Rejects /Warnings (RB)

Registration Rejects/Warnings (RG)

Transfer of Beneficial Rights Rejects (BF)

Physical Transfer of Servicing Rights (SC)

Foreclosure Reject Report (DF)

Payoff Reject Report (DP)

Transfer to Non-MERS Status Reject Report (DQ)

Default by Servicer to Non-Member Rejects Report (DR) Assumption Rejects/Warnings (AB)

Maintenance Rejects/Warnings (MB)
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System Procedu res Manual Release 23.0 12/10/2012 Member Corpo rate Name Changes 22

Member Corporate Name Changes

Overview

Because of mergers, acquisitions and other business events, your

corporate name as recorded in the MERSSystem may need to be

changed. Please review the MERSSystem Membership

Application, Rules of Membership, and Terms and Conditions for

policies pertaining to these events.

You must notify MERSCORP Holdings in writing at least 30 days

before a name change becomes effective, and may be required to

notify MERSCORP Holdings earlier if the change is due to amerger with or acquisition by a non-Member. MERSCORP

Holdings will make the change on the MERSSystem.

Impact

This process has potential impact on all MERSSystem

Members.

Business Procedure

1. MERSCORP Holdings requires official written notification

for all corporate name changes. Use theCompany

Information Change Requestform available on the

corporate website.

The notification must be completed by an officer of your

company and sent to MERSCORP Holdings no less than

thirty (30) calendar days before the effective date.

The notification must include the following information:

Member Org ID Old corporate name

New corporate name

(Must be unique within the MERSSystem)

Effective date of the name change

Reason for name change (e.g. merger)


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System Procedu res Manual Release 23.0 12/10/2012 Member Corpo rate Name Changes 23

Member Type (General, Lite, or Patron)

Other Org IDs affected by change

Name, title, and email address of company officer

submitting notification2. MERSCORP Holdings updates your corporate name in the

MERSSystem on the effective date specified.

3. The new corporate name appears anywhere your member

name is linked to its Org ID. For example, on all pop up

lists in the MERSSystem, registered loans and batch

transactions in the system, and reports produced thereafter

will show the new name. However, the Assignee and

Assignor fields are free-form fields and are not linked to

the Members Org ID; therefore, the name change will notappear in those fields.

4. If MERS has previously issued your organization a MERS

Corporate Resolution, you will need to request an updated

MERS Corporate Resolution that reflects your new

company name via the Corporate Resolution Management

System (CRMS).

Reports

No reports are associated with changing Member Information.


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System Procedu res Manual Release 23.0 12/10/2012 Mortgage Identi fication Number (MIN) 24

Mortgage Identification Number (MIN)

OverviewThe Mortgage Identification Number (MIN) is the unique 18-digit

number permanently assigned to a mortgage registered on the

MERS System. To process information on the MERSSystem,

you must enter the MIN.

A MIN consists of a three section, 18 digit string in the following

format:

Component 1: Seven-digit organization identification

number (Org ID) of the organization that generated the

MIN*. You will be notified by MERSCORP Holdings of

your Org ID. Like the rest of the MIN, the Org ID never

changes, regardless of servicing transfers. For example, in

the MIN 9594567-0123456789-8, the Org ID is 9594567.*The exception to this is MINs generated through MERS

1-2-3, which begin with 1230000.

Component 2: 10-digit sequence number assigned by you.

You can use existing numbers, such as loan numbers, as the

sequence number, or you can use randomly generated

sequence numbers, as long as you never re-use the number.

For example, in the MIN 9594567-0123456789-8, the

sequence number is 0123456789.

Component 3: One numeric check digit calculated by you

using the Mod 10 Weight 2 Algorithm, listed in the

Business Procedure of this section. For example, in the

MIN 9594567-0123456789-8, the check digit is 8.

A MIN is unique and must never be reused. However, it can be

reactivated if it was deactivated because servicing was sold to a

A MIN in X12 file or flat file format

does not include dashes between

the components.


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System Procedu res Manual Release 23.0 12/10/2012 Mortgage Identi fication Num