MERS Policy and Procedure Best Practices

Question:

Does my organization need a Mortgage Electronic Registration Systems, Inc. (“MERS”) Policy and Procedure and, if so, what should it entail?

 

Answer:

If your organization utilizes MERS it should maintain a written policy and procedure documenting your organization’s internal requirements regarding MERS. When creating and implementing such policy and procedure, lenders should consider, among other things:

  1. MERS Administration
    1. Roles and Responsibilities
    2. Corporate Resolution and Quarterly Attestations
    3. Deactivation of Mortgages from MERS
  2. MERS Registration
  3. Servicing
  4. Corporate Resolution Management System (CRMS) Procedures
    1. QC Process for reviewing actions taken by MERS Signing Officers
    2. Signing Officers certification and eligibility requirements
    3. Process for reporting instances of signings occurred by non-officers
    4. Managing user information
    5. Annual Recertification Process
  5. MERS Oversight and Reconciliation Procedures
    1. Monthly, if the Bank services 1,000 or more active registered loans as of March 31st of the current year;
    2. Quarterly, if the Bank services under 1,000 active registered loans as of March 31st of the current year.
  6. Quality Control / Quality Assurance
  7. MERS Annual Report
  8. Adoption of the Policy and Procedures
  9. Revision History

To safeguard from potential compliance violations, lenders should aim to create comprehensive policies and procedures, distribute the policies and procedures to relevant staff and management, and properly and regularly train applicable employees and vendors on their responsibilities under such policies and procedures.