MERS Prevails Again over “Split the Note” Claim


U.S. Bankruptcy Judge Rules “Plaintiff ‘Controverts’ Material Facts with Speculation”

Reston, Virginia – March 5, 2013 – (RealEstateRama) — MERSCORP Holdings, Inc. today announced that Judge Janice Miller Karlin of the U.S. Bankruptcy Court for the District of Kansas rejected the plaintiff’s “split the note” theory and related challenge to the validity of the defendant’s interest in borrowers’ property. The “split the note” theory is a legal argument, which alleges that when a mortgage and note are not held by the same entity, the note is unsecured and therefore invalid.

In Hamilton v. CitiMortgage, Inc. (In re Kunze), Judge Miller Karlin granted summary judgment in favor of CitiMortgage, Inc. and held that under Kansas law there is no split of the mortgage and the promissory note when the mortgage is held by an agent of the holder of the note.

“An agency relationship existed throughout the endorsements and assignments of the mortgage and note in this case,” Judge Miller Karlin ruled. “As members of MERS—and pursuant to their agreements with MERS—Irwin Mortgage, Ginnie Mae, and CitiMortgage all appointed MERS to serve as mortgagee on their behalf.”

“This judge and countless others at the federal, state, bankruptcy and appellate levels have rejected this meritless ‘split the note’ theory,” said MERSCORP Holdings’ Director for Corporate Communications Jason Lobo.

For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit


MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS® System and all other MERS® products.  It is a member-based organization made up of thousands of lenders, servicers, sub-servicers, investors and government institutions.  Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note.  The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.

Jason Lobo
Phone: 703-652-1660

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