JP Morgan Chase Stopped Using MERS 2 Years Ago

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We are still in the foreclosure mess. Lawmakers in Washington are calling for a national moratorium. Some of our largest banks, including Bank of America, and JP Morgan Chase, have halted foreclosures in over 23 states. And each day the pile gets higher and more complicated.

When the news first broke we thought that Mortgage Electronic Registration System (MERS) was the culprit. So we figured that if MERS can be fixed, then it would be easy for lenders can get back to foreclosing and evicting homeowners. But the problem runs deeper.

We learned earlier today that JP Morgan Chase stopped using MERS over 2 years ago. Therefore, this issue goes way beyond the simple fact that the courts will not accept the signatures of MERS. In other words MERS does not own the loan and therefore can not foreclose.

Apparently, JP Morgan Chase had some reservations about the legality of MERS around 2007. This lead to the decision to dump the system in 2008. Of course they can not come right out and say this.

JP Morgan Chase appears to be comfortable with mortgages it originated. The issue is with the majority of loans it purchased. These loans were already registered on MERS.

JP Morgan Chase has the biggest reserves of all the banks. Management saw the writing on the wall and increased its reserves for "litigation and repurchase".

Related articles from House Refinance Center

National Foreclosure Moratorium
Aftermath Of Foreclosure - Taxes
How To Select The Right Lender

Related articles

• JPMorgan Exits Electronic Mortgage Tracking System (abcnews.go.com)
• JPMorgan Chase expanding foreclosure review (money.cnn.com)