Mortgage Electronic Registration Systems [MERS] Law and Legal Definition

Mortgage Electronic Registration Systems or MERS, is a registration system for mortgage lenders. MERS was created by the mortgage banking industry to streamline the mortgage process by eliminating the need to prepare and record paper assignments of mortgages. MERS mission is to register every mortgage loan in the U.S. MERS acts as nominee in the county land records for the lender and servicer. Loans registered with MERS are protected against future assignments because MERS remains the nominal mortgagee no matter how often servicing is traded between MERS members. MERS as original mortgagee (MOM) is approved by Fannie Mae.

Once MERS is named as the holder of record for a mortgage, no future assignments need to be recorded in the real estate records. There has been litigation regarding the right of MERS to be the holder of record for third parties. [Matter of Merscorp, Inc. v. Romaine, 8 N.Y.3d 90, 861 N.E.2d 81, 828 N.Y.S.2d 266 (2006)]