We here at Consumer Defense Programs strive to keep our members up to date with the best information possible to help stop illegal foreclosures.  The latest findings (that are winning in court and are getting settlements) is our findings in what’s known as Credit Default Swaps.

You see, when Wall Street securitized loans…ANYONE (and I mean ANYONE) can buy an insurance policy against a loan in the event that that loan defaults.  Under a traditional insurance framework, only a party with a vested interest can buy an insurance policy, but this is not the case in a credit default swap.  Let’s say you own 1/100th of the loan (meaning you are one of 100 investors in the pool), you can buy a credit default swap policy for the full face value of the loan….such that in the event that the loan defaults, you get paid in full.

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Let me repeat that in case you missed it.

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Let’s say John Doe works at a fast food joint on a minimum wage…goes out and gets a loan for a $1 million dollars with no money down.  The loan gets securitized and is sold to 100 investors.  Let’s say ABC Bank is the originator and underwriter for the loan and is also one of those investors…in other words, ABC owns 1/100th of the $1M loan….ie. $10,000.

ABC takes out a Credit Default Swap insurance policy through AIG for the full $1M.  Because ABC knows full well that John Doe is likely to default on the loan, it is in ABC’s interest to insure the loan against the default.

Once John Doe defaults on the loan…ABC gets paid in full for the whole $1M.

This $1M goes to satisfy the loan in its entirety.

In other words, the loan has been fully satisfied.

The debt has been paid in full.

Yet…ABC continues to collect on the loan…and even goes to the extent of foreclosing on the homeowners.

Talk about “having your cake and eat it too”.

How many times do these people need to be paid to satisfy their greed?!  How many bail outs does it take before the people start saying “ENOUGH!”

Here’s a quick video about Credit Default Swaps:

What we are finding now is increasingly, when homeowners go to court and present evidence that their loan has been fully satisfied and paid in full, the banks are backing off..and offering sizable settlements.  Of course banks do not want you to know this sort of information and have gone to great lengths to hide it from the public.

Our researchers recently gained access to a vast database of all Credit Default Swaps in the USA.  It is our belief that most loans are subject to credit default swaps.

So if you are a homeowner facing foreclosure, this might be another tool you might want to add to your arsenal.

Under the terms of the Deed of Trust, it says  something like “upon complete satisfaction of the note, the lender/Trustee must reconvey the property back to the homeowner”.  By this very definition, your loan has been satisfied and your lender does not have the right to foreclose on your loan.

Please forward this article to as many people as possible.  Let’s wake people up!

Thank you.

The Foreclosure Defense Team at Consumer Defense Programs

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Of course, as a homeowner….the burning question is…how do I find out if my loan is part of a Credit Default Swap….and how do I make this into Admissible Evidence?  If you are interested in doing a search to see if your loan is part of a credit default swap, then click on the Credit Default Swap Search link here.

I just came my confirmation hearing for my Chapter 13 bankruptcy this morning.

As a background, I filed for Chapter 13 bankruptcy in the middle of October, one day before my scheduled sale date because my TRO had elapsed to stop the sale of my property.

Bank of America then filed a copy of the promissory note with the back included with a “Pay to the Order of” – endorsed in blank with the court as their proof of claim for the bankruptcy.

We then filed an objection to their proof of claim stating that it appears that the note is a Bearer Note…and only a person in physical possession would have standing to enforce the note.

Bank of America then filed a response to our objection stating that they had possession of the note and intend to present it at the appropriate time. Under the bankruptcy filing in their proof of claim, they are stating for the record that they are a secured creditor due to their successor interest to Countrywide through acquisition.

Here’s where they run into a pickle. They are not the creditor at all. They are in fact a servicer for a securitized loan. We have evidence from Bank of America that states that the owner of the note is a Freddie Mac Trust. This little fact is going to cause them a lot of problems moving forward.

When we went to court today, the Judge was willing to accept their argument that they had possession of the note and that would be sufficient proof of claim.

We objected to this stating an important Federal Appellate Court ruling in re: Veal.

In Veal, it was decided that mere possession of the note was insufficient proof of claim because the creditor also had to provide proof as to how they came into possession of the note and under what purpose.

The Judge in this case is now setting my case for trial sometime in the next 90 days time frame out. Since we will be going to trial, we are now entitled to enter and request certain discovery evidence from Bank of America.

One of the things we will be asking is to have a representative from Bank of America who can answer depositions with first hand knowledge as to the nature and purpose of the transfer and movements of the note.

The problem that Bank of America is faced with is that now that they have stated for the record that they are a secured creditor of the instrument and not a servicer…they can never go back. There are certain rights, privileges and obligations of a holder of the instrument that needs to be proven.

Moving forward, we will obviously be asking for specific clarity as to the nature and purpose of the the transfer and ownership interest Bank of America has. As a debtor in bankruptcy, I have the right to ascertain who the creditor of the debt obligation with absolute certainty. Under the bankruptcy, the burden of proof is on the creditor.

This is why we recommend people to go into the bankruptcy venue where possible. Obviously, bankruptcy is not something one should enter into lightly but ultimately, if this is a matter of whether or not you get to stay in your home or get kicked onto the streets, the choice is pretty simple.

I will keep you posted with the progress of my case as it progresses.

Vince

For too long, homeowners who challenge a bank’s standing to foreclose on their properties have been called “strategic defaulters” by banks and their attorneys.  For too long, this term has gone unchallenged.

As you know, words are powerful.  The term “strategic defaulter” has some very negative notions and preconceptions in the mind and eyes of the judge/jury.  It says the homeowner can pay but chooses not to.  It says the homeowner is a dead beat.

Fundamental to our movement is the concept of Standing.  We as a movement overall are standing up and objecting to the bank’s standing to foreclose on our houses.

Today, I propose we use a new term: “Standing Objector“.

The term “objector” takes its roots from the Vietnam War era “conscientious objector”, where a person objects to being drafted into a war they do not believe in.  Here, we are objecting to banks stealing people’s homes without proper standing to do so.

The word “standing” refers to the bank not being the real party of interest to foreclose on our homes.  There is a second meaning to this word, and that is “standing up”…which simply means we are standing up for our rights and demand that we are given proper due process as protected under the law and compel these banks to follow the law.

So please, start using this word and pass it around.  Let’s see if we can introduce this word into the common vocabulary of the Standing movement.

If you like this, please forward this article to your friends.  Click on the +1 button below.

Vince Khan

Ps. Looking for an affordable foreclosure defense attorney?  Click here for more info.

I’ve been struggling to find good honest attorneys for the last 18 months or so, ever since I started this journey who not only understand foreclosure defense arguments but who understand the plight of the homeowners.

Last week, I am proud to say, my quest is over.

Let me tell you about this attorney network I found.  The attorney I spoke to was Ameenah from California.  Her firm is able to help clients fight foreclosure nationwide.  The thing is….her firm only handles foreclosure defense and bankruptcy.  The know all the arguments as outlined in my book and then some.

One of the things that has impressed me beyond belief is that when we started to talk about pricing (since most homeowners facing foreclosure don’t have a lot of money), the first thing coming out of Marco ‘s (Ameenah’s finance manager) mouth was…”we want to keep prices to as low as possible so we can serve as many homeowners as possible.  Since we specialize in this area of law, we have optimized our process to take advantage of certain regular routines and processes and we pass these savings onto our clients.

This is a law firm that cares.  Ameenah says “It’s not about the money.  We are passionate about what we do and we want to help homeowners.”

Ameenah and her partners have helped thousands of homeowners.  One of their attorney even won cases in the Californian Supreme Court.

The other amazing thing about Ameenah’s group is that they take payment plans.  This is unheard of.  Most attorneys tell you “Give me $10,000 before I will even speak to you.” where as with Amida’s group, they will happily consult with you, and talk to you about your case….see if you have a case (ie. they don’t want to take your money is you don’t have a strong likelihood of success).

Ameenah and her partners will be making themselves available to members of Consumer Defense Programs for 2 hours every week to answer your legal questions….and she’s doing this on her dime…for free.

I don’t know about you, but to me, action speak louder than words.  In my mind, Amida and her team are saints.  I love them to death and they have my highest endorsements.

Remember, I am talking about REAL REPRESENTATION…real defense, and court appearances in your State on your behalf.  They can stop foreclosures, and even if you’ve lost your home …they might be able to even reverse the sale in many cases….and do it AFFORDABLY for you.

So, if you are interested in finding more about Ameenah and her team, head over to “Lawyers Who Get’s It“.

These guys are the real deal.

Sincerely

Vince Khan
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