In the spring of 2011, the Office of the Comptroller of the Currency issued consent orders outlining a quality assurance mission for MERSCORP Holdings, Inc. and the nation’s largest servicers. The mission was designed to ensure the data accuracy within the MERS® System could effectively support its role in securitization.
As a result, MERS consolidated the Consent Order to reflect new Member requirements. Today, MERS requires an annual scope of review for MERS General Members. It encompasses a review of the 6 conditions listed on the MERS Annual Report. The core objectives of the 6 conditions listed are answering how a Member supports MERS data integrity requirements and operational procedures.
MetaSource performs MERS Annual Report reviews as the Third Party. We perform a thorough review of a Member’s data integrity and operational policies and procedures for the production and execution of a MERS Annual Report. Now with more than half of 2017 in the books and servicers are eyeing that end of year deadline for the MERS Annual Report, here’s a look back on the top 8 MERS quality assurance (QA) issues based on our client work over the last six years:
- DOCUMENTATION: Document, document, document! A large part of the audit consists of reviewing written policies and procedures. MERS requires that you have written internal procedures in place designed to provide reasonable assumability by another employee. i.e. Can your department easily explain and demonstrate your foreclosure policy?
- DATA INTEGRITY: How does your MERS department ensure data integrity? How does your department see to the required comparison of the servicing data to MERS data? How do you cure the data issues identified? How do you track and monitor your compliance efforts?
- REPORTING: How does your company utilize MERS reporting to meet compliance requirements? Reviewing daily reports on the MERS system is a must. Many reports are available but not all are applicable to a Member’s business model. How do MERS reports apply to your MERS requirements?
- CONTACT INFORMATION: Is your MERS system contacts and business information up to date? This includes the Corporate Resolution Management System (CRMS) and MERS system contact roles. i.e. Is your IT contact the appropriate person and is the phone number updated?
- DOCUMENT REVIEW: Internal document sampling and reporting. MERS requires you to conduct random external monthly reviews and quarterly self audits. Has your MERS department incorporated a MERS QA doc review?
- MERS eQA PLAN REVIEW: Has your MERS department reviewed and submitted the MERS eQA plan in the current compliance year? Is the MERS eQA plan completed accurately? Does it fit the MERS member business model – i.e. does your company utilize and need to address iRegistrations or non-MOM docs?
- SUB SERVICER OVERSIGHT: Do you have the appropriate documentation to support the MERS functions your subservicer provides?
- DO YOU KNOW IF YOU NEED A THIRD PARTY MERS REVIEW? Don’t wait until the last minute. If you are a MERS General member, contact the MERS compliance help desk today to ensure your understanding of your requirements. MERS Annual Reports are due December 31st of each year and can take up to 90 days or more to complete.