Home / Daily Dose / Texas Courts Validate MERS Assignments
Print This Post Print This Post

Texas Courts Validate MERS Assignments

gavel-twoTwo U.S. district courts in Texas held that MERS assignments were valid for two separate cases in which Bank of America was the defendant, granting motions to dismiss in both cases, according to an announcement from MERSCORP Holdings.

In the case of Campo vs. Bank of America in the U.S. District Court for the Southern District of Texas, Houston Division, the plaintiff argued that the assignment of the deed of trust to MERS failed to transfer any servicing rights because MERS had no enforceable interest in the deed of trust, and therefore the assignment to MERS was invalid.

The court, citing a precedent in the case of Reece v. U.S. Bank Nat’l Ass’n, Our Court has expressly recognized that MERS may assign a deed of trust to a third party and that such assignments confer the new assignee standing to non-judicially foreclose on property associated with that particular deed of trust.”

In a similar recent case of Rivers v. Bank of America in the U.S. District Court for the Northern District of Texas, Dallas Division, the court adopted the Findings, Conclusions, and Recommendations of Magistrate Paul Stickney, who found that “[g]iven that the Deed of Trust in this case names MERS as the beneficiary… and because MERS subsequently assigned the Deed of Trust to the Defendant, this assignment transferred all rights in the Deed of Trust, including the right to foreclose on the Property.”

“These rulings are consistent with other decisions in Texas and in courts throughout the country.”

Janis Smith, MERSCORP

“We are pleased that both courts continue to recognize that MERS has a valid interest in the deed of trust and has the right to assign that interest to third parties,” said MERSCORP Holdings VP for Corporate Communications, Janis Smith. “These rulings are consistent with other decisions in Texas and in courts throughout the country.”

MERS has won several cases last year and in the first few months of 2016 in which the deed of trust assignment was challenged, including a few in Texas. In September, a district court in Collin County, Texas, reinstated a MERS lien that had been extinguished

A district court in Collin County, Texas, reinstated a MERS lien that was previously extinguished in a quiet title action in the case of Mortgage Electronic Registration Systems, Inc. v. Kingman Holdings, Inc.  MERS contended that their due process rights under both the Texas and U.S. Constitutions were violated when Kingman did not provide MERS, as record beneficiary of the deed of trust, with notice or make MERS a party to Kingman's action that sought to extinguish the MERS lien.

About Author: Brian Honea

Brian Honea's writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master's degree from Amberton University in Garland.
x

Check Also

DSN-AUG203

Customer Experience: Listen, Experiment & Measure

Now is the time to ensure your customer experience initiatives are adapting to the new normal and you understand any shifts in your customers’ needs and expectations. This piece originally appeared in the August edition of DS News, out now.

GET YOUR DAILY DOSE OF DS NEWS

Featuring daily updates on foreclosure, REO, and the secondary market, DS News has the timely and relevant content you need to stay at the top of your game. Get each day’s most important default servicing news and market information delivered directly to your inbox, complimentary, when you subscribe.