New York City Council, US Supreme Court May Determine the Legality of MERS

A resolution was introduced in New York City Council this week, “calling on the New York State Legislature and the Governor to enact legislation that would prohibit lenders from concealing mortgage assignments through the use of the Mortgage Electronic Registration Systems, Inc., known as MERS.”   The controversial MERS electronic mortgage trading system has emerged as the epicenter of the national foreclosure fraud epidemic.

We think the NYC Council resolution will pass and lead the way to strong anti-MERS legislation in New York State.   Few New York politicians will risk political suicide by voting to keep residential mortgage transfer records secret from their angry constituents.

In other news the United States Supreme Court was asked for the first time to consider a number of issues relating to foreclosure fraud and the dubious legality of the MERS system.

In the case of Jose Gomes v. Countrywide Home Loans, Inc. a California appellate court ruled that MERS had the right to foreclose on San Diego homeowner Jose Gomes without allowing Gomes to question if Countrywide (on whose behalf MERS was allegedly acting) actually held the note on his house.

Mr. Gomes’ attorney filed an urgent request to the United States Supreme Court (a Petition for Writ of Certiorari) to hear Mr. Gomes’ final appeal before he loses his home.  Unfortunately for Mr. Gomes, his final appeal to the nation’s highest court may never be heard.  The Supreme Court gets to pick and choose which cases it will decide.

If the Supreme Court decides not to hear the Gomes v. Countrywide case, Mr. Gomes will lose his home to a foreclosing bank that has not proved it owns Mr. Gomes’ mortgage and promissory note.  To make matters worse, Mr. Gomes may be sued again for the same debt if the real owner of his mortgage shows up later and demands the money owed.

Frankly, we have more faith in New York City, and even Albany, than in the Roberts Supreme Court to protect the rights of homeowners against illegal foreclosures.

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