MERS Sees Commercial Opportunity.(Brief Article)

After having gained good acceptance on the residential side of the mortgage industry, the Mortgage Electronic Registration Systems initiative is gathering critical mass to take on the commercial side as well.

The initiative, which began taking shape last year, has attracted monetary backing from Bear Stearns, John Hancock and Wells Fargo, and several others are likely to follow.

While the total development effort for the project is estimated at $500,000, Dan McLaughlin, EVP, MERS, said that the initiative will begin taking concrete shape after it gets at least five "development partners" and $250,000 in funding.

Once they have five committed backers, the business requirements for the initiative will be finalized and then the initiative will go into development.

As an incentive to invest, the monetary backers will get discounted registration fees to use the MERS system, until they recoup 150% of their initial investment in discounts.

In another move forward for the initiative, the Commercial Mortgage Securities Association and the MBA's CREF board of governors have endorsed the use of MERS for their membership, Mr. McLaughlin said.

He remarked, "We have the two major trade associations associated with CMBS activity in the industry endorsing us. That's really the latest and greatest thing that has happened with moving MERS into the commercial world."