Secondary Market Investors, Regulators Requesting Mortgage Electronic Record System® Quality Assurance Plan
MERS® has been functioning in place for many years, eliminating many cumbersome, expensive and ineffective procedures to effect and track the transfer of individual mortgages in the secondary market. It drew much unwanted attention during the foreclosure crisis, as legal challenges resulting from the inferred opacity of the system - because you can't ascertain the holder of the mortgage/note from county recorders offices - seemed to threaten the very basis of the business model. Having survived, for now, many of the issues which arose during the crisis are now filtering their way to the front lines. Market participants who once did very little more than assign a MERS® ID now find themselves having to fulfill other obligations.
First among these is Quality Assurance. While adding another series of checks and balances to our quality control process seems like another burdensome cost of doing business, a rational approach allows us to understand that we actually conduct this audit as a regular part of our business. We just need to prove we do it. This involves two steps:
1.) Recording our MERS® steps
2.) Having a plan that identifies the person who keeps the records and submits the information
As a MortgageManuals.com Customer, you can download for free here or if the link is broken, here:
Relax - it's in there...
If you are a mortgagemanuals,com customer, all of the procedural requirements correctly reflect HUD's requirements. The concern many are voicing reflect references to the 4060, which were removed in most places, but still persisted in others.
In addition, there are examiners asking for 4000.1 References, instead of the old 4060 references, and things have changed their name a little. But you should be able to perform a Word Search function and find these references within your plans.
Here is the updated 1-19 Guidance on 4000.1 References
In addition, please read the newsletter for clarification of the Pre-Closing/In-Process functions and Sampling Requirements.