Editor: David Reiss
Brooklyn Law School

February 8, 2013

Nebraska Supreme Court Holds that MERS is Not a Mortgage Broker

By Gloria Liu

In MERS, Inc. v. Nebraska Dept. of Banking & Fin, 704 N.W.2d 784 (NE S. Ct. 2005), the Supreme Court held that MERS was not a mortgage broker under the Mortgage Bankers Registration and Licensing Act. The court agreed with the district court’s characterization of the services provided by MERS. The district court stated that the “MERS system was created to facilitate the transfer of ownership interests and servicing rights in mortgage loans. Under the System, MERS serves as mortgagee of record for participating members through assignment of the members’ interests to MERS. Mortgage lenders participate in the MERS System as members upon completion of a membership application.” Even though the Supreme Court was in agreement with the above characterization it concluded that such services are not equivalent to acquiring mortgage loans, as defined by the Act.

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