I would agree that MERs should be considered a critical vendor. There are very clear regulatory rules around providing the consumer with the "best data available."
As a critical vendor, you will need to conduct a periodic risk review (at least annually), regular performance monitoring, etc.
However, MERs is one of the few providers with very strict requirements of its members (those using the database). Your organization must provide a QA plan and perform an annual MERs audit. If there are less than 1000 loans in the portfolio, that audit may be performed internally. If there are more than 1000 loans, an external audit firm is required.
I bring these requirements to your attention so you can confirm where this activity is happening in your organization. While not typical, I have seen these responsibilities delegated to Third-Party Risk Management. If they are not fully aware of the requirements, it can create much confusion and rework.
I have provided a Link to the MERs manual for your reference.
https://www.theice.com/publicdocs/MERS_System_Procedures.pdf (QA information begins on page 61)
I hope you find this information helpful. I would love to hear from other members too.
Original Message:
Sent: 10-08-2021 11:35 AM
From: Anonymous Member
Subject: MERS (Mortgage Electronic Registration System)
This message was posted by a user wishing to remain anonymous
We are in process of evaluating our critical vendors, during this process we have several vendors such as Elie Mae or MERS for example that we have tagged them as critical vendors, however myself being new to the mortgage/financial industry, I would like to see what are the best practices on managing these vendors by other financial firms? are they considered critical by other financial firm if so, how are they managing them meaning, their yearly vendor visit, due diligence documents, addressing their ongoing system issues etc.
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