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Transfer of Beneficial Rights O er ie

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Transfer of Beneficial Rights Overview

A beneficial rights transfer is the transfer of the security interest under the mortgage or deed of trust to a new investor. The new investor in a TOB cannot be a non-MERS member. MINs included in a TOB must be "Active(Registered)" status. A TOB transaction can be done in MERS either in batch mode or online. MERS users have two options for transferring beneficial rights to another member: Option 1 and Option 2. The determination of whether Option 1 or Option 2 is used is based on an investor option on the membership profile of the purchasing investor. Option 1 An Option 1 transaction can be done in either batch mode or online. In a typical batch Option 1 transaction, the investor transfers beneficial rights on a system other than MERS. The off-MERS transfer is then recorded in MERS in a one-step process using an Electronic Data Interchange (EDI) or MERS proprietary flat file format initiated by the purchasing investor. Option 1 transfers are initiated by an Agency investor such as FNMA, GNMA or FHLMC. Only the new investor can create an Option 1 TOB online. No confirmations are required for Option 1 transfers. Once the Transfer Date is reached, active MINs will transfer to the new investor. MINs that are not yet registered when an Option 1 TOB batch is created will cycle for ten (10) business-processing days on the transfer reject report. If the MIN is registered within the cycling time frame, the transfer will process. When you transfer beneficial rights using either of the Option 1 processes, the Option 2 investors on the MIN is replaced by the Option 1 investor. The investor that was removed during the Option 1 process is notified of its removal by the Investor Removed b Option 1 TOB report. Additionally, interim funder interests and Warehouse Gestation lender interests are released automatically in an Option 1 beneficial rights transfer. If the current investor on the MIN in the TOB batch is an Option 1 investor, the transfer will reject. A MIN can be in an Option 1 and Option 2 beneficial rights transfer batch at the same time; however, the Option 1 transfer will always take precedence over the Option 2 TOBR. When the Option 1 beneficial rights transfer is recorded, the duplicate MIN is deleted from the Option 2 beneficial rights transfer. The MINs that were deleted from the Option 2 beneficial rights transfer, due to an Option 1 TOB processing, appear on a transfer report: MINs Deleted from Transfer of Beneficial Rights. Non-duplicate MINs remain in the Option 2 transfer batch. Also, MINs can exist simultaneously in a pending Option 1 beneficial rights transfer batch and a transfer of servicing batch. When the Option 1 TOB processes, the investor on the duplicate MIN is updated as follows: If all of the MINs in the TOS batch are impacted by the Option 1 TOB, the investor is updated in the existing TOS batch If only some of the MINs in the TOS batch are impacted by the Option 1 TOB, the duplicate MINs are removed from the TOS batch and placed in a new TOS batch created by the system. The Option 1 investor is named in the new TOS batch. The Transfer Date may be any valid date but it cannot be changed once an Option 1 TOB has been created. When the Option 1 TOB batch is being created the pool number, investor loan number and Agency ID can be entered for each MIN in the transfer. Once the transfer batch has been created, these three fields cannot be changed and MINs cannot be added to the transfer batch. The member that initiated the Option 1 TOB can cancel the entire pending transfer. Option 2 An Option 2 beneficial rights batch transfer can be conducted in both batch mode and MERS below: An Option 2 TOB batch may be created using MERS transaction 202, or via EDI.
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OnLine as described

OnLine, the MERS proprietary flat file format for

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Transfer of Beneficial Rights O er ie

T T , O . T , . C Coe isting Securit Interests Report. T . T :

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Roles in the Transfer Process Vie ing and Confirming Information

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