With Q2 2026 coming to a close, now is an opportune time for mortgage companies to prepare for the Mortgage Electronic Registration System, Inc. (MERS®) Annual Report. Mortgage companies that participate in the MERS System must follow updated requirements, including an annual attestation process.1 For mortgage servicers that meet certain loan volume thresholds, this process includes an independent external review.
MERS typically issues annual report notifications midyear, making early preparation important to avoid compressed timelines later in the year. Servicers with 1,000 or more active Mortgage Identification Numbers (MINs) or loans as of March 31, 2026 must complete an independent, third-party review, while those below this threshold may use an internal reviewer (subject to independence requirements). All applicable servicers must submit their completed MERS Annual Report by December 31, 2026.
If this annual compliance obligation is missed or incomplete, servicers may face corrective actions, including restricted MERS system access, membership suspension, and increased scrutiny from investors or counterparties. Companies can lay the groundwork for a smoother year-end by focusing on their compliance as soon as possible. When this review begins late in the year, servicers can face condensed timelines, reviewers with booked schedules, and limited remediation options.
It’s important that mortgage companies approach this attestation exercise as a pulse check rather than a check-the-box formality. The MERS review can reveal operational gaps that affect data integrity, governance, and document execution across the loan servicing cycle, all of which can impact regulatory readiness year-round and beyond.
What Is the MERS Independent Review?
The MERS independent review is a third-party attestation required under the MERS Quality Assurance Plan (QA Plan).2 This framework creates the MERS Annual Report, which must be submitted through the MERS System by December 31, 2026, for those named as servicer on one or more active MINs as of March 31, 2026. Those who must complete this meet the following criteria:
- Mortgage servicers with 1,000 or more active MINs as of March 31 – a third-party reviewer is required.
- Mortgage servicers with fewer than 1,000 active MINs as of March 31 – an internal reviewer is permitted with independence requirements.
Both cases call for consistent MERS work: mortgage servicers must document processes, demonstrate that controls are operating, and be prepared to explain and address any “no” responses to the six audit areas. For further information, please refer to the MERS System Rules of Membership3 and the MERS System Procedures Manual.4
What to Consider for the Review: Six Audit Areas
With the December 31 deadline drawing nearer, it’s helpful to start with the basics. The MERS Annual Report is structured around six audit areas with related questions for each section.
- Member Information & Organizational Changes: Questions are posed around processes for maintaining current membership data and documentation. Reviewers study legal entity names, contacts, roles, and organizational changes that may affect MERS activity. They also look for routine events (reorganizations, outsourcing changes, system conversions, or acquisitions) that could introduce documentation gaps and work to ensure that changes were tracked and reflected in governance materials.
- Data Reconciliation: This area supports the alignment between a servicer’s system of record and the MERS system. For servicers with 1,000 or more active MINs, reconciliation is typically performed monthly; those with fewer active MINs may perform this quarterly. Questions may cover the frequency and completeness of MERS data reconciliation.
- Corporate Resolution Management System (CRMS) & Signing Officers: This focuses on policies governing the CRMS, Signing Officer certifications, and further quality control for Signing Officer actions. Reviewers consider whether servicers maintain current Signing Officer rosters, track required certifications, and remove access for specific situations, e.g., when roles change or a Signing Officer’s employment ends.
- Transaction Accuracy & Timeliness: This area focuses on QA Plan testing procedures for monitoring MERS transaction accuracy, timeliness, and other state-specific requirements.
- MERS Document Preparation & Execution: Documents should show clear MERS compliance. Reviewers frequently focus on whether registrations and paid-in-full loans are processed within required timeframes and whether these documents are executed by an authorized MERS Signing Officer.
- MERS System Reports: The final part covers review and resolution of daily execution reports. Reviewers consider if exceptions are reviewed, assigned, resolved, and closed with an auditable trail. As portfolios grow and transfer activity increases, exception queues can become backlogs. Effective programs define severity tiers, service‑level expectations, and root‑cause tracking to reduce repeat items.
Note: Each question is answered with a “yes” or ”no” response. Any “no” response requires a written explanation and remediation recommendation from the reviewer.
Common Findings & Operational Risks
Recurring issues uncovered during an independent review often come down to operational discipline and documentation. Mortgage servicers should address the following, as these compliance gaps can grow and impact loan transfers, regulatory readiness, and more:
- Outdated MERS contacts, roles, or related documentation following organizational changes.
- Missed or incomplete monthly data reconciliation cycles, or unresolved discrepancies without assigned ownership.
- Gaps in Signing Officer certification tracking.
- Delayed registrations or payoff processing beyond the required timeframes.
- Unresolved exception reports accumulating without a clear escalation path.
MERS Annual Report Roadmap
Mortgage servicers can take the following steps over the next few months.
- Use a readiness checklist. Before beginning the review, confirm that required documentation and evidence are current and readily available, including:
- MERS QA Plan and related procedures
- Evidence of data reconciliation activities
- Current MERS contacts and user access reviews
- Signing Officer roster and certification records
- Exception report logs and resolution tracking
- Documentation of organizational changes affecting MERS activity
- Confirm your MINs threshold. Determine whether your organization meets the 1,000-MIN threshold as of March 31 and whether a third-party reviewer is required.
- Review and align your QA Plan. Confirm that documented procedures reflect current processes and address all six audit areas.
- Establish a consistent reconciliation cadence. Begin or validate your monthly or quarterly reconciliation process ahead of the review period.
- Validate Signing Officer governance. Confirm certifications are current and remove inactive or terminated users.
- Engage your reviewer early. Third-party reviewers often begin engagements in Q2 or Q3; waiting until later in the year can compress timelines and limit remediation options.
How Forvis Mazars Can Help
Forvis Mazars supports mortgage servicers and subservicers in preparing for the MERS independent review. Our IT Risk & Compliance professionals offer practical insight into how MERS obligations intersect with servicing operations, system conversions, and transfer activity.
We can serve as an independent third‑party reviewer and assist internal teams by reviewing documentation, evaluating control design and operation, and identifying practical remediation considerations. In addition, our team can help organizations identify process improvements and gaps, strengthen documentation, and prepare for a smoother review cycle.
To learn more about how Forvis Mazars can support your MERS Annual Report requirements, please contact us.