Posted on Thursday, June 30, 2011
Ruling in favor of Avelo Mortgage, the Second Appellate District of the California Court of Appeals declared Mortgage Electronic Registration Systems, Inc. (MERS) a proper beneficiary on the deed of trust in Ferguson v. Avelo Mortgage.
In his June 1 ruling, Judge David S. Milton stated that MERS, as the deed of trust beneficiary, has the authority under California law to assign a deed of trust. The judge
also ruled that Avelo Mortgage did not need to possess the promissory note in order to begin foreclosure proceedings.
Milton referred back to an earlier ruling involving Countrywide to support the decision.
“Just as in Gomes v. Countrywide, the deed of trust in this case specifically states, ‘Borrower understands and agrees that MERS holds only legal title to the interests granted by Borrower in this Security Instrument, but if necessary to comply with law or custom, MERS (as nominee for Lender and Lender’s successors and assigns) has the right to exercise any or all of those interests, including, but not limited to, the right to foreclose and sell the Property; and to take any action required of Lender including, but not limited to, releasing and canceling this Security Instrument,’” Judge Milton said.
In a statement, Janis L. Smith, MERSCORP VP of corporate communications, said the court acknowledged MERS’s powers to act on behalf of a California lender.
“Ferguson v. Avelo adds to the significant body of judicial decisions affirming MERS’s role as the deed of trust beneficiary,” she said.
By: Heather Hill Cernoch DS NEWS