Contact:  Karmela Lejarde
Communications Manager
703-761-1274

Vienna, VA, September 23, 2005—MERS announced today that it has asked its members to temporarily cease foreclosure actions in the name of MERS in Florida pending an appeal of an adverse ruling in the Sixth Judicial Circuit Court in Pinellas County.

In his ruling on August 18th, Judge Walt Logan claimed that MERS does not have standing to act as a plaintiff in a mortgage foreclosure suit if it is not the owner of the beneficial interest in the note.

In response, MERS is appealing the decision because as a matter of law, MERS has a right to foreclose either as a note-holder or as an authorized agent.

“Florida has adopted the Uniform Commercial Code (UCC) and the applicable statutes do not require the beneficial owner of the debt to be a party in the foreclosure suit,” said Sharon McGann Horstkamp, MERS Vice President and Corporate Counsel. “MERS can have standing when MERS is the holder of the note on behalf of the beneficial owner.”

Judge Logan challenged the pleadings filed by local foreclosure attorneys due to a lack of clarity in those pleadings regarding ownership of the promissory note. It is an error by Judge Logan to deny MERS the opportunity to amend the complaints in order to eliminate any inconsistent allegations concerning ownership. Instead, Judge Logan categorically dismissed the cases with prejudice to MERS based upon his inaccurate conclusion that MERS cannot foreclose unless it actually owns the underlying promissory notes.

“Our responsibility is to look out for the best interests of our members,” said R. K. Arnold, MERS President and CEO. “That means we want to help them avoid additional costs and delays in Florida foreclosures because of this ruling. So while the appeal is proceeding, we’re temporarily suspending foreclosures in the name of MERS in Florida.”

MERS is advising its members to prepare and execute assignments from MERS to an entity designated by their investor. MERS will also announce when it has obtained a reversal of Judge Logan’s ruling on appeal and when foreclosures can resume in the name of MERS.

About MERS

MERS is an electronic loan registry created by the real estate finance industry to eliminate assignments when trading mortgage loans. Borrowers name MERS as mortgagee and nominee for the lender on deeds of trust and mortgages that are recorded in the county land records.