Atlanta Federal Court Rules That MERS' Mortgage Assignment Valid

Posted on Sep 26, 2012

Senior District Judge J. Owen Forrester of the U.S. District Court for the Northern District of Georgia ruled in Crutcher v. CitiMortgage. Forrester dismissed a borrowers’ claim of wrongful foreclosure against Mortgage Electronic Registration Systems, Inc. (MERS) and two other defendants.

In Crutcher v. CitiMortgage, Judge Forrester found no merit to the borrower’s allegations. “The Security Deed states that MERS is ‘grantee’ and the nominee for ‘Lender and Lender’s successors and assigns,’ ” he held. “To the extent that American Freedom assigned any interest in the Security Deed to Irwin Mortgage, that assignment did not alter MERS’s status as nominee for ‘Lender and Lender’s successors and assigns.’ ”

With regard to signing officer actions during the foreclosure procedures, citing established case law Judge Forrester noted that “[p]laintiff’s allegations concerning the ‘dual hat’ role of employees who work for both CitiMortgage and MERS are equally without merit. Courts have addressed the issue of certifying officers wearing two ‘hats’ and determined that this does not affect the validity of the assignment.”

“MERS authority as nominee is plainly written in the standard document that borrowers sign at closing,” said Janis L. Smith, MERSCORP Holdings vice president of Corporate Communications. “Judge Forrester’s dismissal makes clear that these challenges are baseless.”


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