Chain of Title by David Dayen

you ever go by Cirilo besides here on Facebook?”
    Lisa didn’t get a response right away, so a few days later, she tried to pump more info out of her new Panamanian friend. “Hi Cirilo, by any chance did you used to work doing mortgage stuff? I’m just starting to work in the industry and I saw your name on a document and wondered if that was you! I mean, how many people have the same name as you do? Small world! How’s life in Panama these days? Lisa.”
    Thirteen minutes later, Cirilo messaged back. “Sure I work for Firm Solutions Panama it has to do with foreclosures I am the training manager.”
    Maybe private detective work was Lisa’s calling, not nursing. She later tried to get Cirilo interested in an interview about mortgage documents with a local paper; she would be the interviewer, of course. Cirilo replied, “I will let u know promptly,” but never followed up.
    But Firm Solutions Panama was enough of a lead. The company billed itself as“the premier legal and financial support services provider in Panama.” They seemed to work directly with foreclosure mills, providing and processing documents. Like outsourcing in American manufacturing, law firms apparently outsourced document creation, which would go from the doc shop in Panama to wherever the documents needed to be signed.Lisa found one Facebook page where Firm Solutions and Florida Default Law Group, the firm in her case, were connected.
    Why would a law firm employ an offshore document processor in Panama unless the documents had never been created initially? These werebasic forms, to be completed for any mortgage transfer. It was obvious to Lisa that this was all a weak attempt to paper over inattention to proper procedure during the go-go housing bubble.Mortgage originators sold $1.9 million worth of loans every minute in the peak bubble years; they had no time or inclination for paperwork. These fabrications covered up the original sin: nobody established the chain of title properly, on perhaps millions of mortgages.
    Cirilo seemed nice enough to Lisa. She figured he was just a cog in the Great Foreclosure Machine, a line worker, someone told what to do and when to do it. If it wasn’t so sad it would be comical: day by day, unsuspecting Central Americans put on ties and dress slacks, went to the office, and nonchalantly manufactured the raw materials in U.S. foreclosure cases, unaware of their central role in what increasingly looked to Lisa like a criminal enterprise. How many families were thrown onto the street every day because of what someone in Panama did for a living?
    Lisa had one more question. What was Mortgage Electronic Registration Systems?
    Several different entities had a connection to Lisa’s loan: DHI Mortgage, JPMorgan Chase Bank, Chase Home Finance, Wells Fargo, U.S. Bank. But this new company, Mortgage Electronic Registration Systems, seemed to play no role in the securitization chain. The assignment called it the nominee for DHI Mortgage. But the note said DHI sold the originated loan to JPMorgan Chase. How was Mortgage Electronic Registration Systems the nominee for the mortgage but not the note? How did they fit into the picture?
    The answer can be found in hundreds of obscure county offices all over America. In Palm Beach County they call the lead administrator at this office the “clerk of courts.” Elsewhere they are called “county recorders” or “registers of deeds.” Whatever the title, public servants have managed these offices since before the American Revolution. They track and record property transfers on every piece of land in the United States. You could walk into a county recording office and trace the history of your property for as long as it existed.
    Property recordation is based on old English common law. After the feudal period, when the monarchy owned all land, statutes governing privately owned real estate gradually developed.