Whether you fundamentally believe that MERS has a legitimate role to the play in the mortgage sale process--and there are many vociferous critics right now--it would be hard to envision the industry going back to the pre-MERS days, when everything was done manually.

We can't go back to the dark ages. No more than the stock market could go back to the pre-DTCC days. The idea of an industry-wide registry still makes sense.

That raises the question: Is there any way MERS, which still has the lion's share of the market, can recreate itself as a firm that satisfies the industry and the many judges who have been and will be confronted with the issue? There are plenty of skeptics, and it's unclear what MERS's strategy is. There have been signs that the firm is willing to change as well as signs that the firm wants to just ride out the storm.

Which brings us to Global Debt Registry, which intends to build an industry-wide registry that will essentially fix the defects of MERS and win the support of all important players. For one thing, it intends to pay fees to all county land registrars when mortgage change hands. That will go a long way to reducing the sort of opposition that MERS faces. Global Debt Registry also apparently intends to do away with the idea of deputizing employees of banks who then foreclose on a property. Indeed, unless an existing contract states otherwise, the authenticated seller and the identified buyer are the only participants in the transfer of ownership for a portfolio.

In sum, the firm aims to ensure that each and every mortgage that is securitized will be transferred properly with the appropriate assignee and showing that each time the mortgage traded hands that it is in the appropriate county records and that all required government service fees have been paid.

That seems like what the original MERS was intended to be. But it didn't turn out that way.-Jim