MERSCORP Holdings, Inc., announced that a three-judge panel of the United States Court of Appeals for the Ninth Circuit affirmed the dismissal of a complaint against Mortgage Electronic Registration Systems, Inc., (MERS) and two other defendants.
In Buchna v. Bank of America, the panel affirmed the dismissal granted by U.S. District Court Judge Mary H. Murguia in Arizona. Murguia had granted MERS’ motion to dismiss in October 2010, finding that MERS is a valid beneficiary and is authorized to enforce the Deed of Trust under Arizona law.
In her decision, Murguia said she found no merit to the plaintiff’s claim that securitization of the loan severed the note from the Deed of Trust. She ruled that such allegations “ignore that the Deed of Trust states that MERS will serve as the nominee for the original lender as well as the original lender’s successors and assigns and has the right to ‘foreclose and sell the property.’”
The Court of Appeals cited its earlier decision in Cervantes v. Countrywide Home Loans, Inc., for its decision to affirm Murguia’s order.
“The Ninth Circuit Court of Appeals, no stranger to these cases, ruled definitively that the plaintiff’s claims were meritless,” said Janis Smith, VP for corporate communications at MERSCORP. “MERS has legal authority to act on behalf of the lender, including the right to execute the assignment or foreclose, and there is a wide body of case law supporting this fact.”
The MERS System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.
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