the big lie - mers mortgages in massachusetts.11!28!10-2

8/8/2019 The Big Lie - MERS Mortgages in Massachusetts.11!28!10-2

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The Big Lie:

MERS Mortgages in Massachusetts

by Jamie Ranney, Esq.Jamie Ranney, PC4 Thirty Acres LaneNantucket, MA [email protected]

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1. SUMMARY"If you tell a lie that's big enough, and you tell it often enough, people willbelieve you are telling the truth, even when what you are saying is totalcrap.,,1

The validly of the Mortgage Electronic Registration System, Inc., ("MERS") system andits ability to have survived (most) legal challenges (thusfar) to its existence, its legalstanding and its core purpose(s), seems based on a variation of the "big lie" theory statedabove.2MERS is a privately-run electronic recording system for the tracking of legal andbeneficial interests in mortgage loans in the United States. The MERS "system" has, forall intents and purposes, leapfrogged what in most states are centuries-old systems forpublicly recording various real estate transactions (primarily mortgages and assignmentsofmortgages although more recently, foreclosure documents) MERS has done nothingless than usurp the role of many state government recording agencies in administering,for itself and its members, what will or what will not be disclosed on the public landrecords with respect to ownership interest(s) ofloans in some 60% of the real property ofthis country.Virtually everyone who would be in a position to effectively and credibly challengeMERS' very existence - including judges, state legislators and many legal commentators- seems to assume (in most cases) that MERS has a right to exist and do what they dosimply because MERS itself says they do. Couple this with the fact that MERS wasformed, financially-backed and is owned by the nation's biggest banks and their businessaffiliates, (title insurance companies, foreclosure mill law firms, etc.; and the fact thatsome 66 million MERS mortgages have been registered in this country) and it is clear tosee that MERS designed i tself with staying power in mind. Undoubtedly MERS hasdeveloped a market "momentum" and ubiquitous presence that makes it difficult toignore - or challenge. Again, if the lie is big enough, people begin to accept it as thetruth.Despite its insertion into the very foundation (no pun intended) of our nation's housingmarket however - and the broad economic implications for the country was a whole werethe MERS-system ultimately found to be invalid or unlawful - simply being "too big tofail" does not make what the MERS-system does, right or legal. It is this author 's opinionthat MERS is not right or legal in Massachusetts.By effectively eliminating the transparency required on the public land records for thedisclosure of encumbrances on real property in Massachusetts, MERS-mortgages havesown massive confusion, serious incidences of fraud and perhaps billions of dollars ofliabilities into a land recording system that - although perhaps ancient and out-dated in1 UFOs, .JFK, and Elvis: Conspiracies YOll Don't Have To Be Crazy To Believe, Belzer, Richard; (Ballentine Books,1999)2 The original "big lie" theory is actually attributed to Adolf Hitler. See http://en .wikiped ia.org/wiki/Big_Lie

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many respects - has consistently served the fundamental purpose(s) for which it wasformed: to promote transparency as to ownership interests in land and to provide "actualnotice" to parties reviewing the public land records of the current ownership andexistence of encumbrances on real property.This memo will focus on MERS-designated mortgages in Massachusetts.In this author 's opinion two (2) things are evident after a survey of Massachusetts law.First, MERS cannot be a valid "mortgagee" under Massachusetts law and thus MERSdesignated mortgages are invalid in the Commonwealth ofMassachusetts.This is because MERS-designated mortgages by definition "split" the security instrument(the mortgage) from the debt (the promissory note) when they are signed. This "split"invalidates the mortgage under Massachusetts law. Where the security interest is invalidupon the signing of the mortgage, MERS cannot occupy the legal position of a"mortgagee" under Massachusetts law no matter what language MERS inserts into theirmortgages that purports to give them the legal position of "mortgagee". Since MERSdesignated mortgages are invalid at their inception, it follows logically therefore thatMERS mortgages are not legally capable of being recorded in the Commonwealth ofMassachusetts by its Registers ofDeeds.Second, even if a MERS-designated mortgage were found to be a valid securityinstrument in Massachusetts, each and every assignment of the mortgage and note"behind" a MERS-designated mortgage must be recorded on the public land records ofthe Commonwealth in order to comply with the Massachusetts recording statute atM.G.L. c. 183, s. 4 which requires that "conveyances of an estate" be recorded to bevalid. A mortgage is a "conveyance of an estate" under Massachusetts law. SinceMERS-designated mortgages exist for the primary purpose of holding "legal" title on thepublic land records while the "beneficial" interest is transferred and sold multiple times(and a mortgage cannot exist without a note under Massachusetts law), MERS-mortgagesunlawfully avoid recording fees due the Commonwealth for the transfer(s) of interestsunder MERS-designated mortgages.II. BACKGROUND ON THE AUTHORI am a 41 year-old sole practitioner on the island ofNantucket. Born in Los Angeles, CAand thus not a "real" islander, my family moved to Nantucket in 1977 and I went toschool here and have been practicing law on Nantucket for almost eleven (11) years.I went to Vermont Law School (VLS) where I graduated in 1999. I enjoyed Vermontsummers more than the winters, never skied once in three (3) years, was admitted to theVLS General Practice Program (where you learn how to actually BE a lawyer), playedrugby (broke my nose twice), wrote a movie review column for the school newspapercalled "The Mothership", was elected a student Trustee in my third year and thereaftergenerally made myself the bane of the VLS administrat ion's existence. My law school

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grades were not impressive. I am co-owner of a local propane company on Nantucket(www.nantucketenergy.com) and the co-founder and race director for the NantucketTriathlon (www.acktri.com).Although currently inundated with foreclosure defense cases, I normally run a generalpractice office on Nantucket that deals with usual small town lawyering issues - DDI'sand minor criminal defense, landlord-tenant work, some civil litigation, collections,contractor disputes, local permitting work and some real estate conveyancing.I "happened" into foreclosure defense by accident when about 18 months ago an elderlycouple came to see me. In their 70's, they told me that they were being evicted from theirhome. They had no money and didn't know what to do. At first I thought I would justbuy them some time so that they could find another place to move to. But after reviewingthe paperwork, it became clear that this was much more than an eviction case. Thecouple, well-known residents ofNantucket for more than 50 years, were being evictedfrom their home after a foreclosure sale. 3 When I reviewed their loan documents, I wasstunned to see that their stated income at the time they obtained their mortgage was$4,000.00 per month - primarily social security income. The loan payment that they hadsigned up for? More than $17,000.00 a month. Thus began my entry into foreclosuredefense, predatory lending and mortgage fraud (on the lender 's side).I have worked closely with Glenn F. Russell, Jr., from Fall River, MA([email protected]) - one of the pioneering Massachusetts attorneys in the area offoreclosure defense. I have also worked together with Thomas B. Vawter, Esq., fromNeedham, MA ([email protected]) to develop innovative foreclosure defensestrategies including challenging a foreclosing bank's standing in Servicemembers casesin the Massachusetts Land Court and in raising standing challenges to post-foreclosureevictions.As of this writing I have approximately 75 foreclosure defenses cases. About 90% are onNantucket and are in various stages from pre-foreclosure default, to active default, tocommencement of Servicemembers hearings in the MA Land Court, to sale datesscheduled, to active MA Superior Court and federal (District Court and BankruptcyCourt) cases.Approximately 65-70% of my cases involve MERS as the purported mortgagee.III. MORTGAGE LOANS GENERALLYIn my experience, the average person is confused by what a "mortgage loan" actually is.Wikipedia states in pertinent part:

"A mortgage loan is a loan secured by real property through the use of amortgage note which evidences the existence of the loan and the] http://www.ack.net/Gilbert-Foreclosure-101410.htm!

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encumbrance of that realty through the granting of a mortgage whichsecures the loan. However, the word mortgage alone, in everyday usage,is most often used to mean mortgage loan.According to Anglo-American property law, a mortgage occurs when anowner (usually of a fee simple interest in realty) pledges his interest (rightto the property) as security or collateral for a loan. Therefore, a mortgageis an encumbrance (limitation) on the right to the property just as aneasement would be, but because most mortgages occur as a condition fornew loan money, the word mortgage has become the generic term for aloan secured by such real property.,,4

So what does a "mortgage loan" consist of?A mortgage loan consists primarily of 1.) the promissory note (the "note") and 2.) themortgage.The note: 5The note is your "promise to pay". It is the formal acknowledgement of the debt owed.It is usually 3-5 pages long, and contains all of the essential terms of the loan (how muchyou are borrowing, who you are borrowing from, interest rate, monthly payment amount,term of loan, etc.).A note is a "negotiable instrument" under Massachusetts law. See M.G.L. c. 106, s. 3104. As a "negotiable instrument", a note can be sold or transferred subject only tocertain legal requirements that consist primarily of the formality of the transfer andconsideration (payment) for the note. A person or entity that owns your note is called a"holder". One who holds a note must be a "holder in due course" for them to have toright to collect the debt. See M.G.L. c. 106, s. 3-302. Physical possession of the note isrequired for a party to be a holder in due course. See M.G.L. c. 106, s. 1-201(20)The mortgage:The mortgage is the instrument that attaches the debt (evidenced by the note) to yourproperty. It contains further conditions of your loan and typically contains a "power ofsale" that allows the mortgage holder to sell your property if you don't pay the moneyyou owe under the terms of the note. 6

4 http://en.wikipedia.org /wiki/Mortgage_loan5 According to MERS's rules, they never own notes or the right to any payments under a note (or mortgage).6 For authority to foreclose under the power of sale in a mortgage see M.G.L. c. 183, s. 21. Massachusetts is a "nonjudicial" foreclosure state. This means that a lender need only properly notice a default and advertise the property forsale for three (3) weeks in order to foreclose on the mortgage and sell the secured proper ty at auction. M.G.L. c. 244,s. 14.

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IV. WHAT IS MERS?MERS is a privately-owned and operated electronic database that was designed for theprimary purpose of allowing the electronic tracking of promissory notes andcorresponding mortgages in the United States. 7MERS was set up in the mid-1990's by several of the country's biggest banks, secondarymarket mortgage buyers (Freddie Mac, Fannie Mae) along with other industrystakeholders (Mortgage Bankers Assoc.; American Land Title Assoc.) and over the lastdecade or so, some 66 million MERS mortgages have been registered on the MERSsystem in the United States.MERS has described itse lf as follows8:

What is MERS?MERS serves two purposes. First, it is a national electronic registry for trackingservicing rights and beneficial ownership interests in mortgage loans. Second,MERS acts as nominee (a form of agent) for the servicer and beneficial owner of amortgage loan in the public land records. MERS is designed to operate within theexisting legal framework in all U.S. jurisdictions and did not require any changesto existing laws. How is this made possible? Its members appoint MERS as themortgagee of record on all loans that they register on the MERS System. Thisappointment eliminates the need for any future assignments when servicing rights aresold from one MERS Member to another. Instead of preparing a paper assignment totrack the change in the county land records, all subsequent transfers are trackedelectronically on the MERS System.MERS does not create or transfer beneficial interests in mortgage loans or createelectronic assignments of the mortgage. What MERS does do is eliminate the needfor subsequent recorded assignments altogether. The transfer process of thebeneficial ownership ofmortgage loans does not change with the arrival ofMERS.Promissory notes still require an endorsement and delivery from the current ownerto the next owner in order to change the beneficial ownership of a mortgage loan.MERS is a Delaware corporation with a broad base of ownership from the mortgageindustry. American Land Title Association is among our owners and has a seat on theMERS Board ofDirectors. Other owners with substantial investments in MERS includethe Mortgage Bankers Association of America (MBA), Fannie Mae, and Freddie Mac.

7 One court succinctly described MERS as follows: "MERS is a private corporation that administers theMERS System, a national electronic registry that tracks the transfer of ownership interests and servicing rights inmortgage loans. Through the MERS System, MERS becomes the mortgagee of record for participating membersthrough assignment of the members' interests to MERS. MERS is listed as the grantee in the official records maintainedat county register of deeds offices. The lenders retain the promissory notes, as well as the servicing rights to themortgages. The lenders can then sell these interests to investors without having to record the transaction in the publicrecord. MERS is compensated for its services through fees charged to participating MERS members." Mortgage Elec.Reg. Sys., Inc. v. Nebraska Depart. a/Banking, 270 Neb. 529, 530, 704 N.W.2d 784 (2005).8 This explanation - present on the MERS website for some time - has recently been removed. (www.mersinc.org)

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These parties, along with Ginnie Mae, decided several years ago that MERS would be amajor benefit to the mortgage industry and worked together to create the MERS of today.How does MERS become the Mortgagee of Record?

MERS is put in this position in one of two ways: the first is by an assignment froma lender or servicer to MERS. This method is usually associated with bulktransfers of servicing. The second way is with the lender naming MERS as themortgagee of record as nominee for itself (and its successors and assigns) in theoriginal security instrument at the time the loan is closed. We call this secondoption "MOM", which stands for MERS as Original Mortgagee. "MOM" was asignificant milestone for MERS and the mortgage industry. Fannie Mae, Freddie Mac,and Ginnie Mae have each approved the use of MERS as original mortgagee as nomineefor a lender on the security instrument for loans sold to them and registered on the MERSSystem. In order to make MOM work, changes were made by Fannie Mae and FreddieMac to their uniform security instruments allowing MERS to be named as the mortgageein a nominee capacity for the lender. First, to reflect the interrelationship of thepromissory note and mortgage and to ensure these two instruments are tied togetherproperly, the recital paragraph names MERS, solely as nominee for Lender, asbeneficiary. Second, it is made clear that the originating lender rather than MERS isdefined as the "Lender". This change was made so that everyone understands that MERSis not involved in the loan administration process. Third, as mortgagee of record, MERSneeds to have the authority to release the lien of security instrument, or if necessary,foreclose on the collateral on behalf of the lender. Such authority is provided by adding aparagraph to the security instrument informing the borrower that MERS holds only legaltitle to the interests granted by the borrower. It also informs the borrower that, ifnecessary to comply with law or custom, MERS may exercise the right to foreclose andsell the property and may take any action required of the Lender to release or cancel thesecurity instrument. Once MERS is named in the original security instrument or by wayof an assignment, the document is then recorded in the appropriate public land records.From this point on, no subsequent assignments of the mortgage to a MERS memberneeds to be recorded. MERS remains in the land records, as mortgagee, throughout thelife of the loan" so long as servicing is not sold to a non-MERS member. All subsequenttransfers of ownership in mortgage loans and servicing rights for that loan are trackedelectronically between MERS members through the MERS System. This processeliminates the opportunity for a break in the chain of title. Moreover, unless a MERSmember transfers servicing rights to a loan registered on the MERS System to a nonMERS member, the loan stays on the system until it is paid off. The process to transferservicing rights between MERS members requires an electronic confirmation from thebuyer. It begins with the seller entering loan transfer information into the system,including the Mortgage Identification Number (explained below), the new servicerorganizational identification number, the sale date, and the transfer effective date. Thebuyer then must submit a confirmation acknowledgment to the system. The old servicerand the new servicer are still required to notify the homeowner in writing when loanservicing is traded as required under the Real Estate Settlement Procedures Act(RESPA), 12 U.S.C. 2601 et seq. A loan is de-registered from the system only if

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its servicing rights to a loan are transferred to a non-MERS member. With every newloan that is registered on the MERS System, it becomes more likely that you will come incontact with a mortgage loan having MERS as the mortgage holder in the chain oftitle.,,9v. MORTGAGES AND NOTES IN MASSACHUSETTSBy definition under Massachusetts law, "A mortgage is security for a note or otherobligation." Private Lending & Purchasing, Inc. v. First American Title Insurance Co.,54 Mass. App. Ct. 532, 537, 766 N.E.2d 532, 537 (2002).As further explained by William V. Hovey, Michael Pill & Darren Baird recently:"The mortgage was but an incident to the debt." Perry v. Oliver, 317 Mass. 538,541,59N.E.2d 192, 193 (1945). That means the mortgage cannot be separated from the debt."The mortgage was only an incident to the debt which it secured. The debt wasevidenced by the note. A mortgage on real estate transfers a title to the realty [UnitedStates Trust Co. v. Commonwealth, 245 Mass. 75, 139 N.E. 794; Geffen v. Paletz, 312Mass. 48, 43 N.E.2d 133], but the title is defeasible upon the payment ofmoney or theperformance of some other condition for which the mortgage was given, **13 3 Depon v.Shawye, 163 Mass. 206, 161 N.E. 243; General Ice Cream Corporation v. Stern, 291Mass. 86, 195 N.E. 890, and the title held by the mortgagee cannot be separated from thenote and applied independently of the note by a creditor of the mortgagee in payment of adebt of the latter, leaving the note outstanding as a valid obligation of the mortgagor tothe holder of the note who might possibly be a person other than the mortgagee."Coperstein v. Bogas, 317 Mass. 341,343-344,58 N.E.2d 131,132-133 (1944). See 28Massachusetts Practice Series: Real Estate Law with Forms (4th ed. 2004 & Supp. 20092010); William V. Hovey, Michael Pill & Darren Baird; October 22,2010 at p. 5.What does this mean?It means that under Massachusetts law, a note and mortgage cannot be "split" without themortgage losing its legal effect. Put another way, a mortgage without a note doesn' tsecure anything. A note without a mortgage is nothing more than an unsecured debt likea credit card account.In order for a mortgage to have legal effect in Massachusetts, the stated mortgage holdermust hold and own the note. Not only must the mortgage holder "own" the note, theymust have physical possession of it in order to have a valid enforceable mortgageinterest. 1O See M.G.L. c. 106, s. 1-201(20) ('''Holder' with respect to a negotiableinstrument, means the person in possession of the instrument is payable to bearer or, inthe case of an instrument payable to an identified person, if the identified person is inpossession."). Emphasis supplied.9 See www.merscorpinc.org. For a recent survey ofa slew ofMERS-rel ated cases erupting across the country seewww.johnhoogelawoffice.comlwp/wpcontent/uploadsIMERS Williams Hooge.pdf10 This is particularly important when a mortgagee wants to foreclose on a mortgage.

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Splitting the note and mortgage therefore - which is undisputedly what happens in aMERS-designated mortgage - renders the mortgage unenforceable under Massachusettslaw.More importantly, since a MERS mortgage is unenforceable at the outset, a MERSmortgage cannot be legally recorded as a "conveyance of an estate" since the mortgage unenforceable as it is - conveys nothing. See M.G.L. c. 183, s. 4 and discussion below inParagraph VI. 1IMassachusetts follows the majority rule regarding the "splitting" of notes and mortgages.Carpenter v. Longan, 83 U.S. 271, 274 (1872) ("The note and mortgage are inseparable;the former as essential, the latter as an incident. An assignment of the note carries themortgage with it, while an assignment of the latter alone is a nullity.") Merritt v.Bartholick, 36 N.Y. 44, 45 (1867) ("[A] transfer of the mortgage without the debt is anullity, and no interest is acquired by it."). 12Again, Hovey, Pill & Baird:

"A leading Massachusetts treatise, Howard J. Alperin, 14C MassachusettsPractice: Summary of Basic Law, 15.126 (4th ed. & Supp. 2009-2010),summarizes rule [sic] as follows:Both the obligation (the note) and the security interest (the mOligage) mustbe transferred to the same person, [FN8] because "a transfer of themortgage without the debt is a nullity, and no interest is acquired by it.The security cannot be separated from the debt and exist independently ofit."[FN9] That is, as leading commentators have stated, " ...the security isworthless in the hands of anyone except a person who has the right toenforce the obligation; it cannot be foreclosed or otherwiseenforced. "[FN10]

[FN8] Restatement, 3d, Property (Mortgages), 5.4 andComment a; 1 Nelson and Whitman, Real Estate FinanceLaw, 5th Ed. (Thomson/West, 2007), 5.27, p. 530.[FN9] Merritt v. Bartholick, 36 N.Y. 44, 51, 34 How. Pr.129, 1867 WL 6406 (1867). See also 5-Star Management,Inc. v. Rogers, 940 F. Supp. 512, 520 (E.D. N.Y. 1996)

11 While it may be true that a true mortgagee can "contract" with a note holder so that the two instruments can beseparately owned, this does not mean that the intervening assignments can avoid being recorded as they do under aMERS-designated mortgage. Moreover, the splitting of the ownership of note and mortgage has, as mentioned herein,the legal effect of un-securing the mortgage as a matter of Massachusetts law and voiding the mortgage interest,voiding the power of sale in a mortgage and rendering the debt unsecured.12 For a case that does not agree that MERS "splits" the note and mortgage under Massachusetts law or that such splitas the legal effect of unsecuring the mortgage, see in re Huggins. 357 B.R. 180 (Bankr. D. Mass. 2006). This authorhowever agrees with authors Hovey, Pill & Baird and believes that Huggins was wrongly decided and is contrary toMassachusetts law. For a detailed examination of the Huggins holding and its defects, see Mortgage lee. RegistrationSys., Inc. (MERS) v. Johnston, No. 420-6-09 Rdcv (Slip. Op. Vt., Cohen, .I., Oct. 28, 2009; unpublished).

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(applying New Mexico law) (" ... an assignment of amortgage without the underlying debt is a nullity,and therefore unenforceable ....").[FNI0] 1 Nelson and Whitman, Real Estate Finance Law,5th Ed. (Thomson/West, 2007), 5.27. Hovey, Pill &Baird at p. 533.Massachusetts law regarding the "splitting" of notes and mortgages is also consistentwith recent case law in other jurisdictions regarding what "standing" MERS relative tothe mortgage where the note and mortgage are deemed to have been "split" by the MERSsystem paradigm.In Landmark National Bank v. Kesler, 289 Kan. 528, 539-541 (2009), the Courtexamined MERS' standing to insert itself as a "party in interest" into a foreclosure caseand stated:

"The relationship that MERS has [to Sovereign] is more akin to that of astraw man than to a party possessing all the rights given a buyer. Amortgagee and a lender have intertwined rights that defy a clear separationof interests, especially when such a purported separation relies onambiguous contractual language. The law generally understands that amortgagee is not distinct from a lender: a mortgagee is "[0]ne to whomproperty is mortgaged: the mortgage creditor, or lender." Black's LawDictionary 1034 (8th ed.2004).13

Accordingly, under the holding of Kesler, MERS cannot be a mortgagee since itis not a "lender" and doesn't own the note.The Kesler Court, citing a Massachusetts bankruptcy case (In re Schwartz, 366 B.R.265,266 (Bankr.D.Mass.2007)) also commented on the problems with MERS' "offrecord" assignment paradigm.

"It is not uncommon for notes and mortgages to be assigned, often morethan once. When the role of a servicing agent acting on behalf of amortgagee is thrown into the mix, it is no wonder that it is often difficultfor unsophisticated borrowers to be certain of the identity of their lendersand mortgagees. Kesler at 539. (quoting In re Schwartz, 366 B.R. 265,266 (Bankr. D. Mass. 2007)).

13 See also Bellistri v. Ocwen Loan Servicing, LLC, 284 S. W.3d 619, 623 (Mo.App.2009). "The practical effect ofsplitting the deed of trust from the promissory note is to make it impossible for the holder of the note to foreclose,unless the holder of the deed of trust is the agent of the holder of the note. [Citation omitted.l Without the agencyrelationship, the person holding only the note lacks the power to foreclose in the event of default. The person holdingonly the deed of trust will never experience default because only the holder of the note is entitled to payment of theunderlying obligation. [Citation omitted.] The mortgage loan becomes ineffectual when the note holder did not alsohold the deed of trust. "

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Ironically for a lender operating in Massachusetts, a MERS-designated mortgage, insteadof securing a lender's interest in the borrower's property, actually unsecures it themoment the promissory note is indorsed (usually in blank) by the originating lender andis sold down the line to various other parties in a typical MERS-designated transaction. Itis this "split" that voids the security interest in a MERS mortgage under Massachusettslaw. Unless the mortgage itself is properly assigned down the "chain" (along with thenote) to each and every party, there is no legal security for the debt, no valid andenforceable mortgage (including no power of sale), and no cognizable property interestsecured by the mortgage. 14 Since MERS does not own or ever have possession of a note,irrespective of their claimed "nominee" status for the lender, MERS-designatedmortgages are invalid under Massachusetts law. IS

VI. MASSACHUSETTS RECORDING LAWMassachusetts is a "title theory" state.In layman's terms - when a borrower grants a mortgage to a lender, the borrower - as ofthe time they execute the mortgage - has effectively transferred all oftheir interest in theproperty to the lender (up to the amount of the loan) subject to the borrower's right toown the property - free of the mortgage - when the mortgage is paid off.See US Bank National Association v. Ibanez, (08-MISC-384283; Memorandum onMotion to Vacate; Long, J. Oct. 14,2009) citing Faneuil Investors Group, L.P. v. Bd. ofSelectmen ofDennis, 75 Mass. App. Ct. 260,264-265 (2009)16

14 This begs the question as to whether a MERS can legally put the note and mortgage back together into the sameownership in order to create a valid mortgage under Massachusetts law upon the occurrence of some triggering event(typically default of the borrower). To substantiate the right to foreclose MERS typically purports to assign themortgage to the note holder so that the note holder can legally foreclose (MERS has had difficulty foreclosing in theirown name). This author would suggest that since a MERS-designated mortgage violates Massachusetts law from itsinception, such an effort to "put Humpty Dumpty back together again" is legally ineffective. A defective and unlawfuldocument cannot be "rehabilitated" or be alternatingly ineffective and then effective if it was not legal to begin with.Moreover, the MERS method: of "re-connecting" the note and mortgage for the purpose of foreclosure merelyunderscores MERS' tacit recognition that the note and mortgage cannot be legally "split" and still be effective.15 See also In re IValker (CA B.R. 10-21656-RJS; May 20, 2010).16 The Faneui! court stated: "Mortgage theory. General Laws c. 260, 35, inserted by St.1957, c. 370, defines amortgage as a "conveyance made for the purpose of securing performance of a debt." Under our title theory ofmortgages, "[a] mortgage of real estate is a conveyance of the title or of some interest therein defeasible upon thepayment of money or the performance of some other condition." Murphy v. Charlestown Sav. Bank, 380 Mass. 738,747,405 N.E.2d 954 (1980), quoting from Perr.v v. Miller, 330 Mass. 261,263, 112 N.E.2d 805 (1953). See AtlanticSav. Bank v. Metropolitan Bank & Trust Co., 9 Mass.App.Ct. 286, 288, 400 N.E.2d 1290 (1980). See also Eno &Hovey, Real Estate Law 9.2 (4th ed. 2004); Mendler, Massachusetts Conveyancers' Handbook 20.1 (4th ed. 2008)."Literally, in Massachusetts, the granting of a mortgage vests title in the mortgagee to the land placed as security forthe underlying debt."; "a mortgage is a conveyance of title" Maglione v. BancBoston Mort[] Corp., 29 Mass.App.Ct.88,90-91,557 N.E.2d 756 (1990). "The payment of the mortgage note . . . terminates the interests of the mortgagee . ..and revests the legal title in the mortgagor." Pineo v. White. 320 Mass. 487,489, 70 N.E.2d 294 (1946). The Fanueilcourt also stated: [W]hile our cases may implicate a distinction in how whole the transfer or how absolute theconveyance, they also have made it clear that a mortgage is a conveyance. See Geffen v. Paletz, 312 Mass. 48.53.43N.E.2d 133 (1942) (mortgage is "conveyance of real estate or of some interest therein"); Krikorian v. Grafton Co-op.Bank, 312 Mass. 272, 274, 44 N.E.2d 665 (1942) (mortgage is "conveyance in fee"); Pineo, supra. (mortgage is"conveyance in fee"); Perry, supra (mortgage "is a conveyance of the title or of some interest therein"); Atlantic Sav.

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Because the lender/mortgagee gets "title" to the land under a mortgage in Massachusetts,the Massachusetts "recording" statute(s) are triggered. This memo will focus solely onthe recording statute for unregistered land.M.G.L. c. 183, s. 4 (unregistered land) states in pertinent part:"A conveyance of an estate in fee simple, fee tailor for life, or a lease for more thanseven years from the making thereof or an assignment of rents or profits from an estate orlease, shall not be valid as against any person, except the grantor or lessor, his heirs anddevises and persons having actual notice of it, unless it, or an office copy as provided insection thirteen of chapter thirty-six, or, with respect to such a lease or an assignment ofrents or profits, a notice of lease or a notice of assignment of rents or profits, ashereinafter defined, is recorded in the registry of deeds for the county or district in whichthe land to which it relates lies." Emphasis supplied. See M.G.L. c. 183, s. 4.It is clear therefore that under Massachusetts law, the "conveyance of an estate" ofunregistered land "shall not be valid" (with certain enumerated exceptions), unless it isrecorded in the Registry of Deeds.A MERS-designated mortgage represents a classic "have-your-cake-and-eat it-too"scenario which runs directly counter to the fundamental purpose of Massachusetts'centuries-old property law: transparency and the public disclosure of ownership andother interests in real property on the public land records.In a nutshell, in a MERS transaction, the originating lender wants the unfettered ability tosell and assign your loan, but they don't want to transfer the mortgage along with the debtbecause of, among other things, the attendant complication (and expense) of having torecord multiple assignments and incur a $75.00 recoding fee each time. So under theMERS system, the mortgage stays on the land records in the name of MERS as the"mortgagee" while the note is sold multiple times behind the scenes. Multiplied by 33million active MERS mortgages (some 66 million have been registered since MERS'inception) and one can easily see that there is substantial financial incentive to avoidrecording (and paying for such recording) assignments when ownership of the mortgageloan is transferred. I? Whether each assignment needs to be recorded in a MERS-Balik, supra (mortgage constitutes "deed of conveyance"). See generally Alperin, Summary of Basic Law 15.116(2008-2009 ed.) r 'a mortgage takes the form of a deed of conveyance of real property, transferring a fee interest to themortgagee").17 The nature and effect of the MERS system on the land recording systems of the United States was notably discussedin a recent Congressional report of the issues surrounding the country's foreclosure crisis:"During the housing boom, mu Itiple rapid transfers of mortgages to facilitate securitization made recordation ofmortgages a more time-consuming, and expensive process than in the past. To alleviate the burden of recording everymortgage assignment, the mortgage securitization industry created the Mortgage Electronic Registration Systems, Inc.(MERS), a company that serves as the mortgagee of record in the county land records and runs a database that tracksownership and servicing rights of mortgage loans. MERS created a proxy or online registry that would serve as themortgagee of record, eliminating the need to prepare and record subsequent transfers of servicing interests when theywere transferred from one MERS member to another. In essence, it attempted to create a paperless mortgage recordingprocess overlying the traditional, paper-intense mortgage tracking system, in which MERS would have standing toinitiate foreclosures. MERS experienced rapid growth during the housing boom. Since its inception in 1995,66 millionmortgages have been registered in the MERS system and 33 million MERS-registered loans remain outstanding.

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designated mortgage has never been formally determined by a court as far as I can tell.MERS just decided to do it that way and no one - apparently - has ever challenged it.Leaving aside the fact that MERS-designated mortgages - in and of themselves - areinvalid under Massachusetts law because they "split" the note and mortgage at the time ofthe document's execution, it is apparent that any unrecorded transactions such as the onescontemplated from the outset under a MERS-designated mortgage also run counter toMassachusetts law.Where the intent of the instrument is to securitize a loan into a "pool" ofmortgages (oneof the primary reason for MERS' existence), the note will be "owned" (i f only for anelectronic nanosecond) by at least 1 to as many as 4 or 5 other entities before reaching theTrust in which it finally comes to rest in its final "ownership". Since the mortgage mustgo with the note and has no independent significance without it (see cases cited above),everyone of these assignments must be recorded at the Registry of Deeds to comply withMassachusetts law. In a MERS-designated loan, none of these assignments are recordedwith exception of a "final" assignment (see footnote 12 above) and thus MERSdesignated mortgages unlawfully "avoid" required recording fees under Massachusettslaw.M.G.L. c. 183, s. 4 also provides that a conveyance ofland shall not be valid against anyperson without "actual notice" unless the transfer is recorded in the Registry ofDeeds.This would include mortgages and assignments of a mortgage since they are considered"conveyances" of a property interest. See Faneuil Investors Group, L.P. v. Ed. ofSelectmen ofDennis, 75 Mass. App. Ct. 260,264-265 (2009). The term "actual notice"under the statute has been strictly construed by Massachusetts courts. See Emmons v.White, 788 N.E.2d 557,566 (Mass. Ct. App. 2003); Tramontozzi v. D'Amicis, 183 N.E.2d 295,297 (Mass. 1962); McCarthy v. Lane, 16 N.E.2d 683,685 (Mass. 1938).18"Actual notice" means that you go to the public land records and look and you can seewho owns the property and all the encumbrances are listed. A MERS mortgageunquestionably "shields" off-record assignments of the note (and the correspondinginterest in the mortgage) from being listed on the public land records. Indeed, MERSbrags about not needing to record assignments in their promotional materials. SeeSection IV above. Accordingly, with a MERS-designated mortgage, it is impossible tohave "actual notice" of the ownership of the loan.During the summer of2010, one expert estimated that MERS was involved in 60 percent of mortgage loans originatedin the United States." See Congressional Oversight Panel, November Oversight Report: Examining the Consequencesof Mortgage Irregularities for Financial Stability and Foreclosure Mitigation (November 16,2010), Submitted underSection 125(b)(I) of Title I of the Emergency Economic Stabilization Act of2008, Pub. L. No. 110-34318 " . . . the term [actual notice] is construed with "considerable strictness" and mere "[k]nowledge of facts whichwould ordinarily put a party upon inquiry is not enough." Emmons v. White, 788 N.E.2d at 566 (quoting Tramontozzi v.D'Amicus, 183 N.E.2d 295 (Mass. 1962)). See GMAC Mortgage Corporation v. Bay/co, 05-1 I746-GAO (D.Mass. 921-2007).

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The Massachusetts Supreme Court in Board a/Selectmen v. Lindsay, 444 Mass. 502, 507(2005), (in a case involving the failure to record certain conservation restrictions on adeed), opined on the fundamental purposes behind the Massachusetts requirement thatinterests in real estate be recorded:"Recording acts have two separate, but interconnected, purposes."First and foremost, they are designed to protect purchasers whoacquire interests in real property for a valuable considerationand without notice of prior interests from the enforcement ofthose claims." 14 R. Powell, Real Property 82.0 I [3], a t 82-13(M. Wolfed. 2000). "The second purpose of recording acts isfundamental to the achievement of the first. To make the systemself-operative and to notify purchasers of existing claims, therecording acts create a public record from which prospectivepurchasers of interests in real property may ascertain theexistence of prior claims that might affect their interests."Id. at 82-14. "[T]he effective operation of the entire processof conveyancing, and title assurance depends upon a recordingsystem that excludes from recordation as few instruments aspossible." Id. at 82.02[3], at 82-86 to 86-87.

The Lindsay Court went on to say:In this Commonwealth, "[b]ecause of the long-recognizedinevitability and ubiquity of controversies over land, theMassachusetts Bay Colony enacted a recording act as early as 1640for the declared purpose that' [e]very man may know what estateor interest other men may have in houses, lands or otherhereditaments they are to deal.'" Long v. Wickett, 50 Mass. App. Ct.380, 397 n. 13 (2000), citing A.L. Eno & W.V. Hovey, Real EstateLaw 2.1, at 13 n. 1 (3d ed. 1995). See also Coons v. Carstensen,15 Mass. App. Ct. 431, 433 (1983). "One is entitled to rely upon therecord to ascertain the existence of an encumbrance that must berecorded in order to prevail over a bonafide purchaser. He maydeal with the title to the land as he finds it upon the record"(emphasis in original). Lamson & Co. v. Abrams, 305 Mass. 238,244 (1940). Cf. Houghton v. Rizzo, 361 Mass. 635, 643 (1972) ("theproliferation of implied rights in or servitudes upon real estate,which cannot be readily ascertained by an examination of the recordsof the appropriate registry of deeds or of the Land Court, will serveonly further to erode the integrity and reliability of such records andwill be a subversion of the fundamental purpose for which suchrecords are required to be made and maintained"); McCusker v.Goode, 185 Mass. 607, 611 (1904) ("It is the policy of our law inregard to the recording of deeds, that persons desiring to buy may

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safely trust the record as to the ownership of land, and as toencumbrances upon it which are created by deed"); PopponessetBeach Ass'n v. Marchillo, 39 Mass. App. Ct. 586,587-588 (1996)(defendants' lots not burdened by restrictions where nothing inchains of title placed defendants on notice of such encumbrances onland). Id., p. 508.

Accordingly, and despite MERS' apparent audacity in assuming its own legal validityand the failure, thusfar, for the courts of the Commonwealth to fully examine MERS'legal authority to act as a mortgagee under Massachusetts law and to have thejurisprudential courage to follow the law in finding that it does not (irrespective of theconsequences of such a finding), Massachusetts presumably continues to adhere to thefundamental principle that only official state land records can provide constructive noticeof competing interests in real property.

VII. MERSCORP, Inc., v. Romaine 861 N.E.2d 81 (NY Ct. of App., 2006)The case most closely on point with the question now being asked (do MERS-designatedmortgages violate the Massachusetts recording statute?) is a similar question posed to theCourt ofAppeals ofNew York in MERSCORP, Inc., v. Romaine 861 N.E.2d 81 (2006).In Romaine, the Clerk of the County of Suffolk (Edward P. Romaine) had refused toregister MERS-designated mortgages on the public land records at all. 19 Emphasissupplied. His position - as bolstered by an "informal" opinion from the New YorkAttorney Genera1- was that MERS-designated mortgages failed to comply with NewYork property law since MERS - by its own definition acting only as a "nominee" of thelender - had no property interest in the mortgage and thus could not be a proper"mortgagee" under New York law.Ultimately the Romaine Court held that - based on New York law - the Clerk wasrequired to accept MERS mortgages for recording.There was also a concurring opinion and a dissenting (in part) opinion which are worthnoting for their application to the larger issues that have been created by MERS.In his concurring opinion, Judge Ciparick stated with unusual prescience:

"I concur with the majority that the Clerk's role is merely ministerial innature and that since the documents sought to be recorded appear, for themost part, to comply with the recording statutes, MERS is entitled to anorder directing the Clerk to accept and record the subject documents.

19 Industry parties associated with MERS came out in force to challenge the lower court's finding that MERS was not avalid mortgagee under New York law. Briefs in support of MERS were submitted by the MOl1gage BankersAssociation, American Land Title Association, and Federal National Mortgage Association (Fannie Mae).

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I wish to note, however, that to the extent that the County and variousamici argue that MERS has violated the clear prohibition againstseparating a lien from its debt and that MERS does not have standing tobring foreclosure actions, those issues remain for another day (see e.g.Merritt v. Bartholick, 36 N.Y. 44, 45 [1867] ["a transfer of the mortgagewithout the debt is a nullity, and no interest is acquired by it"]).In addition to these substantive issues, a plethora ofpolicy arguments havesurfaced during the pendency of this proceeding. For instance, {lMERSsucceeds in its goal ofmonopolizing the mortgage nominee market, it willhave effectively usurped the role of the county clerk that inevitably wouldresult in a county's recordingfee revenue being substantially diverted to aprivate entity. Additionally, MERS's success will arguably detract fromthe amount ofpublic data available concerning mortgage ownership thatotherwise oIlers a wealth ofstatistics that are used to analyze trends inlending practices. Another concern raised is that, once an assignment ofthe mortgage is made, it can be d ~ f f i c u l t , i fnot impossible, for ahomeowner to find out the true identity ol the loan holder. Amici whosubmitted briefs in favor of the County argue that this can effectivelyinsulate a noteholder from liability and further that it encourages predatorylending practices." Id. at 85, 86. Emphasis supplied.

In a dissenting (in part) opinion, Judge Kaye likewise showed considerableunderstanding of the corning problems with MERS as he expounded on theproblems associated with MERS-designated mortgages:"Although creating efficiencies for its members, there is little evidencethat the MERS system provides equivalent benefits to horne buyers andborrowers - and, in fact, some evidence that it may create substantialdisadvantages. While MERS necessarily opted for a system that tracksboth the beneficial owner of the loan and the servicer of the loan, its 800number and Web site allow a borrower to access information regardingonly his or her loan servicer, not the underlying lender. The lack ofdisclosure may create substantial difficulty when a homeowner wishes tonegotiate the terms ofhis or her mortgage or enforce a legal right againstthe mortgagee and is unable to learn the mortgagee's identity. Publicrecords will no longer contain this information as, if it achieves thesuccess it envisions, the MERS system will render the public recorduseless by masking beneficial ownership ofmortgages and eliminatingrecords ofassignments altogether. Not only will this information deficitdetract from the amount of public data accessible for research andmonitoring of industry trends, but it may also fimction, perhapsunintentionally, to insulate a noteholderfrom liability, mask lender errorand hide predatory lending practices. The county clerks, ofcourse, areconcerned about the depletion of their revenues - allegedly over one

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million dollars a year in Suffolk County alone." Id. p . 88, 89. Emphasissupplied.It is important to note that the holding in Romaine however is inapplicable inMassachusetts because the holding was based solely on the Romaine Court'sinterpretation ofNew York law.MERS-designated mortgages are invalid under Massachusetts law because nomatter what MERS purports to be in their mortgages, the note and mortgage are"split" at the signing of a MERS-designated mortgage and this has the legal effectofvoiding the security interest. Without a cognizable security interest under avalid mortgage, there is no "conveyance of an estate" which is what is required tobe a mortgagee under Massachusetts law. MERS cannot therefore be amortgagee, and MERS-designated mortgages are not entitled to be recorded.VIII. MERS, MORTGAGE SECURITIZATION AND AVOIDING RECORDINGFEESIn securitized mortgage transactions - the lifeblood of the MERS system and indeed theprimary reason for its existence - there are typically multiple assignments of themortgage loan required to accomplish the complete transaction. These transactions areall done "off record" in order - according to MERS - to avoid recording fees and toallow MERS, and MERS alone to track them. The ostensible purpose of securitization(aside from allowing investment bankers to reduce a 30 year obligation to an instantlypayable commodity and make lots and lots ofmoney) is to make the transactions"bankruptcy remote" by removing the ownership of the loan as far from the loanoriginator as possible in a series of transactions sufficiently "remote" to defeat the loanbeing "sucked into" a bankruptcy filing if the loan originator fails (think WashingtonMutual, Countrywide, IndyMac and dozens and dozens of smaller banks2o).A basic understanding of securitization and the parties involved in such transactions isimportant to an understanding ofwhy MERS violates the Massachusetts recording statuteatG.L. c. 183,s. 4.Mortgage securitization:Typically the proper "chain" of required transactions is conducted under the fairlystandard language contained in a "Pooling and Service Agreement" ("PSA"). Thislanguage governs the terms, conditions and procedures involving the securitization ofmortgage loans and the resulting transfer of those loans into an investment "pool". SinceMERS-related securitized mortgage transactions involve multiple transfers of the note(while the mortgage stays in the name ofMERS), each and everyone of these transfersrequires a recorded assignment to comply with Massachusetts law.

20 See the "failed bank" list since the year 2000 at http://www.fdic.gov/bank/historical/banklindex.html17


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Since, under Massachusetts law, conveyances of interests in real estate such as mortgagesare required to be recorded in order to be valid and MERS intentionally avoids this,MERS has unlawfully "avoided" recording fees due on each and every transfer of aninterest in the underlying debt in all MERS-designated mortgages.IX. M.G.L. c. 183, s. 54B - RECENT AMENDMENTSOn August 9, 2010, Massachusetts Gov. Deval Patrick signed amendments to G.L. c.183, s. 54B into law - with retroactive effect. The law became effective on November 7,2010.M.G.L. c. 183, s. 54B ostensibly deals with the signing requirements for recordingdischarges of mortgages and other documents. However, and importantly for MERS (andunfortunately for the borrowers of the Commonwealth), it also deals with assignments ofmortgage and foreclosure documents.The legislation was purportedly advanced by the Real Estate Bar Association (REBA)and the New England Land Title Assoc. ("NEALTA") and was "unanimously" approvedby the Massachusetts House and Senate. 21 One can only assume that the electedmembers of the Massachusetts legislature did not understand or were not advised as tothe implications ofwhat had been presented for their consideration nor were theconsequences of the bill properly explained in the context of the nation's foreclosureCrISIS.

Text ofsection effective until November 7,2010. For text effective November 7,2010,see below.]"Section 54B. A deed of release or written acknowledgment of payment or satisfaction

of the debt thereby secured, or a release, partial release or assignment ofmortgage, or aninstrument of subordination, non-disturbance, recognition, or attornment by the holder ofa mortgage, or a power of attorney for the purpose of foreclosing a mortgage held by anysuch holder and executing any instrument necessary for that purpose, executed before anotary public, justice of the peace or other officer entitled by law to acknowledgeinstruments, whether executed within or without the commonwealth, by a personpurporting to hold the position of president, vice president, treasurer, clerk, secretary,cashier, loan representative, principal, investment, mortgage or other officer, agent, assetmanager, or other similar office or position, including assistant to any such office orposition, of the entity holding record title thereto on behalf of such entity acting in itsown capacity or as a general partner or co-venturer of the entity holding record title, shallbe binding upon such entity and shall be entitled to be recorded or filed, and no vote ofthe entity affirming such authority shall be required to permit recording of filing.

21 According to their website, the NELTA (http://www.nelta.org/) is an '"aftiliate" of the American Land TitleAssociation ('"ALTA"; http://www.aIta.org/). A representative of ALTA sits on the Board of Directors of MERS and isone ofMERS' '"owners".

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Chapter 183: Section 54B. Mortgage discharge, release, assignment, foreclosure,etc.; execution before officer entitled to acknowledge instruments; effect[Text ofsection as amended by 2010, 282, Sec. 2 effective November 7, 2010 applicableas provided by 2010,282, Sec. 7. For text effective until November 7, 2010, see above.]

Section 54B. Notwithstanding any law to the contrary, (1) a discharge of mortgage; (2) arelease, partial release or assignment of mortgage; (3) an instrument of subordination,non-disturbance, recognition, or attornment by the holder of a mortgage; (4) anyinstrument for the purpose of foreclosing a mortgage and conveying the title resultingtherefrom, including but not limited to notices, deeds, affidavits, certificates, votes,assignments of bids, confirmatory instruments and agreements of sale; or (5) a power ofattorney given for that purpose or for the purpose of servicing a mortgage, and in eithercase, any instrument executed by the attorney-in-fact pursuant to such power, if executedbefore a notary public, justice of the peace or other officer entitled by law toacknowledge instruments, whether executed within or without the commonwealth, by aperson purporting to hold the position of president, vice president, treasurer, clerk,secretary, cashier, loan representative, principal, investment, mortgage or other officer,agent, asset manager, or other similar office or position, including assistant to any suchoffice or position, of the entity holding such mortgage, or otherwise purporting to be anauthorized signatory for such entity, or acting under such power of attorney on behalf ofsuch entity, acting in its own capacity or as a general partner or co-venturer of the entityholding such mortgage, shall be binding upon such entity and shall be entitled to berecorded, and no vote of the entity affirming such authority shall be required to permitrecording." Emphasis supplied as to "new" terms in the statute.It is clear from the language of the previous iteration of the statute, which deals primarilywith the ability of various individuals to sign documents related to mortgages inMassachusetts, that the protections granted the borrowers of the Commonwealth werealready weak.Note that only the "purported" authority of the signer was previously required in order torecord "A deed of release or written acknowledgment of payment or satisfaction of thedebt thereby secured, or a release, partial release or assignment of mortgage, or aninstrument of subordination, non-disturbance, recognition, or attornment . . . " as well asforeclosure documents. Note also that any such documents, if executed by a laundry listof parties stated within the statute, including such lofty titles as "cashier" or an"assistant" to any of the identified "officers" ". . . shall be entitled to be recorded or filed,and no vote of the entity affirming such authority shall be required to permit recording offiling."In August 2010, just before the "robo-signer" crisis exploded into the national media22,the Massachusetts legislature and the Governor, instead of strengthening the protections22 http://www.palmbeachpost.com!money/real-estate/state-probes-whether-three-law-fi rms-falsi fi ed-forecl osure851395.htmlhttp://www.heraldtribune.com!article/20100813/ARTICLE/l 00819878/24 I6/NEWS?p=all&tc=pgall

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for borrowers in the Commonwealth as against banks and their foreclosure mill attorneyswho are signing hundreds of thousands of documents related to foreclosures, thousandsof whom have already lost their homes to illegal foreclosures based on flawed paperwork,were evidently duped by various interest groups into further weakening G.L. c. 183, s.54B and making its provisions retroactive.It is baffling to understand how the interests of the citizenry of the Commonwealth isbeing served by loosening the requirements for signing documents related to mortgages(and assignments thereof) in the Commonwealth - and allowing them to be recorded - inthe midst of clear evidence of the fraud that has been perpetrated on the borrowers in thisstate on a scale so massive that it is hard to even comprehend it. Indeed, I cannot think ofa single, rational reason why documents required to assign mortgages and foreclose onthem should not be signed under the pains and penalties of perjury by individual officersof various entities that not only attest to their personal knowledge of the contents of thedocuments, but provide competent evidence of their ability to act on behal f of the entityfor whom they are signing. Is it burdensome to ask the banks and their affiliates to attestand swear to the very facts and documents which they are already required to have thelegal authority to execute? To ask less merely open the door to the type of fraud that isbeing uncovered on a daily basis while the banks and their affiliates attempt to shrug itoff as "technical" defects in the paperwork.The only plausible explanation for the recent amendments to G.L. c. 183, s. 54B is thatour elected officials were duped by special interests into approving this legislation inorder that much of the issues associated with the flawed paperwork utilized by lenders intheir foreclosure processes can be removed even one step further from challenge byborrowers in the Commonwealth who already bear a heavy burden in having toessentially fend for themselves because the entire system of foreclosure in Massachusettsputs the onus on the borrower to raise (and fund) any challenge to the foreclosureprocess.It is imperative that our elected officials understand and counter what is nothing morethan a transparent effort to cover the tracks of those lenders and their affiliates andpartners in the mortgage and banking industries who are finding themselves plagued withthe consequences of unlawful and poorly executed paperwork and who are sparing noexpense to try and mitigate the damage by and through the legislature in this case - all atthe expense of the borrowers of the Commonwealth who are literally crying out forprotection.Instead of allowing "purp011ed" officers to sign such documents, the documents listed inG.L. c. 183, s. 54B should be required to be executed "under the pains and penalties ofperjury" by parties with "actual knowledge" of the contents of such documents.Competent evidence of the signers authority to sign should also be required. The authorhopes that any legislators or interest groups that read this memo proceed to seekh t t p : / / w w w . i c e l e g a l . c o m / f i l e s l D a i l y ~ B u s i n e s s _ R e v i e w _ N e w s _ I t e m _ D u s t i n _ 8 . 2 6 . 1 0 . p d f

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emergency amendments to G.L. c. 183, s. 54B that are more appropriately balance theinterests of the borrowers of the Commonwealth with the financial interests of the lendersand their agents who clearly cannot be trusted to rely on policing themselves.

DATED: Nantucket, MANovember 27,2010

By:

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the big lie - mers mortgages in massachusetts.11!28!10-2

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