Foreclosure Defense: Module 0

If you are facing a pending sale, then you need to take drastic action NOW.  This module is designed for those of you wanting to be able to stay in your home to give you time so you can fight foreclosure fraud.

Special Alert

” If you are looking for an attorney and can not find one, we might be able to help.

We found a paralegal firm that can craft all your pleadings for you, all response, and do everything to help you in your litigation, including the filing of a TRO/Injunction to stop any foreclosure sale.

The best part is…they can do this for an extremely affordable fixed price.  “

If you find yourself in a situation where you are about to lose your home, you have two options legally.

One is to file a civil action against your lender followed by a motion for a Temporary Restraining Order and Injunctive Relief.  The other is to file for bankruptcy protection with an automatic stay.

Firstly, in order for a TRO and/or an Injunctive Relief to be granted, the petitioner has to show a strong likelihood of success.  This means that as a Plaintiff, you will need to bring compelling evidence to convince the judge that you deserve a stay of the sale.  It is your job to bring significant controversy that brings doubt as to who the real party of interest is in the foreclosure action.

Obviously, having a securitization audit would be hugely beneficial as well as a pleading/complaint that argues the points and authority that the pretender lender is not the real party of interest.  However, this takes time.  Time you might not have.

Crafting a pleading takes time and requires great care.  It is not something that can be rushed.  You should consult your lawyer as to the proper method and process for this.

If you are a member of our foreclosure defense membership program, we have included sample TROs, Injunctive Reliefs as well as sample pleadings that others have used.  It is then up to you to customize the arguments as it applies to your own situation.  Be warned.  You do so at your own risk.  These sample documents do not come with any assurances whatsoever.   You should consult legal counsel before engaging in anything like this.

Sadly, TROs are RARELY granted (especially in California).  The Plaintiff has to bring an overwhelming amount of evidence to cast significant doubt to the judge for one to be granted.  That is why many people turn to the bankruptcy method instead.

To buy time, some homeowners declare bankruptcy.   When you declare bankruptcy, you receive an automatic stay from all creditors, including the “lender”.

Many homeowners feel this is the best and most assured way to stop the sale from happening.

Be warned.  Bankruptcy is not for the weak hearted.  Do not enter bankruptcy lightly.

You will need to declare all your assets, income and financial details.   It is like having a permanent anal probe of your financial details.  It is not pleasant.

Never ever lie, especially in bankruptcy court.  You will go to jail.  As great as it is the temptation to hide the precious little money you have from your creditors, don’t do it.

The other down side of bankruptcy is that it is a mark in your public credit score.  But frankly, having a bankruptcy or a foreclosure these days is not as big a deal as it once was.  Almost half the country has been through it.  It’s like being a leper in a leper colony.  It’s not as big a deal anymore.

Fact is however, for most homeowners, this might be the only way to keep their house from the auction block while they buy time to build their case for their foreclosure defense.

The other thing about bankruptcy is that in our experience, I have found that most of the wins come from the bankruptcy courts.  The thing about bankruptcy is that it has the nice Rule 3001(d).

Federal Rules of Bankruptcy 3001 (d) Evidence of perfection of security interest.

” If a security interest in property of the debtor is claimed, the proof of claim shall be accompanied by evidence that the security interest has been perfected. “

It requires the lender to provide proof of claim.

This means that the table is suddenly turned.  It is now the “lender” who has to come up with the proof of claim.  And if you know how their fraud is being perpetrated, then you know how to object and deflect their deception.

What many people do after they file for bankruptcy is to the file an “adversary proceeding”.  As a debtor, this is absolutely free.  An adversary proceeding is like a normal civil action, but done under bankruptcy court, and under bankruptcy rules.  It allows the debtor to challenge the bank to provide proof of standing.

The other thing many homeowners do is to file their house as an unsecured debt.  This will then prompt the lender to complain.  But in doing so, they are then required to provide proof of claim, which they often are unable to.

Navigating the bankruptcy process is not for the weak hearted.  Even for someone who has a lot of experience in legal procedures.  I highly (seriously, HIGHLY) recommend that you get competent help.  Look, I am here to save you money.  If I HIGHLY recommend something, I mean it.  Some things, you can cut corners with, bankruptcy is something I don’t recommend that you do on your own.  Trust me when I tell you that I tried to do it myself.  It was a disaster.  I wished I had professional help.

Normally, hiring a law firm to handle your bankruptcy costs around $2000 to $4000 for Chapter 13.  We found a company (not related to us)

If you are going to use the Bankruptcy method, be sure to go to Module 1, and download the Documents file.  Within the Documents file, there is a directory called “BK Method”.  This contains a number of documents you will need to file your bankruptcy, objections to the lift of automatic stay and objections to their proof of claim.

Here are the steps in the bankruptcy procedure you need to understand.

Once you file your initial paperwork for bankruptcy, you will need to complete the rest of the paperwork/schedules/declarations within 14 days.  After these are filed, you will need to then go to what’s called a “creditor’s meeting”.  Invariably, no creditor ever show up…in the rare instance some do…but very rarely.  Here the US Bankruptcy Trustee will ask you about your assets, how much you make, etc to get clarity about your proposed bankruptcy.

Next, your creditors…including your lender/servicer will submit what’s called a Proof of Claim to the Bankruptcy court.

Here, you have the opportunity to submit an objection to the proof of claim if you a) feel that the proof of claim submitted is bogus b) if you have evidence to the contrary (such as a securitization audit).  If you do not object…then it is assumed that you accept their submitted proof of claim.

This is where most people go wrong.  Most attorneys don’t even know about this step.

You MUST ALWAYS object to the proof of claim…and require that they absolutely provide proof that they are in fact the true party of interest.

Remember, in bankruptcy, you are protected.  The creditor has the burden of proof.  They must prove to the court beyond a doubt that:

a) They are the creditor

b) The amount is correct

If you are working with an attorney, be sure to insist that they file an objection to the proof of claim if the proof submitted is bogus.

We have a sample objection to the proof of claim in the “BK Method” folder called: “ObjectiontoProofofClaim.doc”

Customize this file and submit it to the court.  Obviously, if you are working with an attorney, then work with them and/or give this template to them.

The strategy here is to put up a wall.  You will not include them in the bankruptcy (this means you will not pay them a single red cent) until such times as they can provide proof of claim.

After all proofs of claims are settled, then and only then can a Confirmation hearing take place.  A confirmation hearing for a Chapter 7 means the Trustee approves of your proposed debt discharge and asks the Judge to approve the discharge.  In a Chapter 13, this means the Judge will put an order requiring you to stick with the proposed repayment schedule for the duration of the plan.

A standard procedure for these banks once you file for bankruptcy is to seek to get a lift of the automatic stay.  They will file a Motion for the Lift of the Automatic Stay.  Unless you object to this lift…this will almost aways be granted.  Be careful.

The strategy to counter this of course is to stop them at the proof of claim stage.  If they can not provide proof of claim, then they have no standing to lift the automatic stay.

In our Documents (in Module 1), you will find several templates and sample objections filed against Motions of Lift of Automatic Stay.

If you find yourself in this situation, then take a look at these templates..customize them…and then file your objection to the lift of automatic stay into court.  Again, if you are working with an attorney, then give these to them to file/prepare on your behalf.

1) BK IS A PAIN IN THE ASS.  It was never designed to be fun.  Filing BK means you have to declare everything.  What you eat, how many times you poop and all the gory details (not quite but you get the point).  NEVER LIE in BK.  You WILL GO TO JAIL.  I will release more info about the process of filing for BK as soon as I get a chance, in the mean time, come check out this site:

http://www.legalconsumer.com/ << VERY GOOD SITE!! BOOK MARK THIS ONE.

This site walks you through everything you need to know about doing BK yourself.

2) You *SHOULD* not do this if you’ve previously filed BK in the last 7 yrs.  I think 10yrs in Chapter 7.

3) You *SHOULD* only file for BK protection (and then dismiss) every 180 days.  The court does not want you to abuse this system.

4) Many homeowners list the bank as an UNSECURED NON CONSUMER DEBT.  It is up to them to prove it.  This is the key.

5) This is gut wrenching stuff.  Make sure you have a good support network so you can get help.  If you haven’t done so, hook up with someone in the Facebook hookup group.   REACH OUT.  HELP OTHERS!  We need each other.  You don’t have to do this alone.

6) Most important. You can only do this Adversary Proceeding process in Chapter 13.  ie. YOU CAN NOT DO ADVERSARY PROCEEDING IN CHAPTER 7.

All egos aside, let’s face some raw and rude realities.  Challenging a bank in State or Federal Court on the basis of standing is a tough sell if you do not have the following:

– Evidence of Movement

– MERS

What I mean by Evidence of Movement is that you closed with Bank A..and now Bank D is trying to enforce or foreclose.  Note, this does not apply to cases such as Countrywide going to Bank of America through acquisition or Wachovia to Wells Fargo.  The bank can easily argue that the loan was simply acquired.

Now, let me be very clear.  Often times, Bank A went from being a Lender to a Servicer.  This is almost always the case with places such as Countrywide/BofA and Chase.  In other words, you closed with Countrywide, but in your discovery (through the research of MERS’ website as well as admissions from the letter back from BofA that they are a servicer).  Once you have an admission that they are a servicer, then you have evidence of movement.

If you have the a situation where you do not have Evidence of Movement, you might seriously want to consider doing the Bankruptcy Method.  ie. You had a loan with Bank A and Bank A is trying to foreclose.   This applies specifically if you are with World Savings/Wachovia and now to Wells Fargo as is the case with my loans.  You see, most of the wins I’ve studied come from Bankruptcy court.  The advantage we have in BK court is this rule here:

” Federal Rules of Bankruptcy Rule 3001 (d):

(d) Evidence of perfection of security interest.

If a security interest in property of the debtor is claimed, the proof of claim shall be accompanied by evidence that the security interest has been perfected. “

This gives you the presumption of law that requires the bank to actually produce evidence of claim.  Otherwise, if you have no evidence of movement, your case will likely be dismissed (if not in a bankruptcy court) for “failure to state a claim”.

To proceed with a civil action in Bankruptcy Court, you will obviously first need to be in Bankruptcy.  Next, you will need to file for a “Adversary Proceeding”.

Be sure to read this important case around FRBR 3001 found in the /BK Method/Important BK Ruling under 3001.pdf.This is an important case law decision that you can reference in your case.

As we mentioned before, a TRO is rarely granted.  But if filing for bankruptcy is not an option, then you got to do what you got to do to stay alive.

Before you can file for a TRO, you have to initiate a civil action.  This means you will need to file a complaint with the court and essentially “sue your lender”.  If you are in a Judicial State and you are being sued, then you just have to challenge your lender on Standing.

In order to properly initiate a civil action, you will need to get up to speed on the rules of civil procedure and learn how to build a pleading and gather evidence.
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The first thing you should do is to go to Module 1 (if you haven’t done so) and download the Documents file.  Once you have downloaded the file, open up the 000-Process Map document as it will give you a road map of the litigation process.  Sadly, we are going to have to compact 3 weeks of education to you in one sitting.  You need to file your civil action ASAP so you can file for a TRO.
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Sadly, the court is not very forgiving.  The rules of court are very specific.  When you sue someone, it is assumed that:

a) You know what you are doing

b) You have all your evidence all prepared.

Unfortunately, I am going to lean on you pretty heavily to get up to speed FAST.  Your house is at stake.  Your family is at stake.  We’re doing whatever we can to help you stay in your home.  This will mean that you will be required to burn some midnight oil.

First, let’s talk about Evidence of Movement

Evidence of Movement

The first and simplest evidence we can bring to court is called Evidence of Movement.

In an Evidence of Movement situation, you closed with Bank A (let’s say Stearns Lending), who sells it to Countrywide (Bank B), who then got acquired by Bank of America (Bank C) ….who then securitizes the note into New York Mellons Bank Trust Series 12345.

So, the Deed of Trust names Bank A as the Beneficiary.  But Bank C wants to foreclose.  Bank C comes to the court with a Deed of Trust pointing at Bank A (Stearns Lending).  Where is the Chain of Title on the Promissory Note that gives Bank C (BofA) the Right to enforce the note?

If you have a situation like this, you might not need to get a securitization audit, although getting one would make your case much stronger and more likely to succeed.

Often times, Bank C would come to the Court claiming “Your Honor, we have reacquired the note and now have the right to foreclose.”  If you encounter this situation, you must learn to object.

1) Show me the chain of title.  If you have sold it, then you lost your right to enforce.

Under U.S.Code Title 12: Banks and Banking
PART 226—TRUTH IN LENDING (REGULATION Z), a servicer does not have the rights of a lender if it has acquired the note for the purposes of administration.

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2) Please stipulate for the record whether the note is part of a pooling and servicing agreement.  Please stipulate whether the note has been securitized.  Please stipulate who “New Your Mellons Bank Trust Series 12323 (of course yours will be different)” is, are they a REMIC?

3) If the loan has been securitized, did you reacquired the note as an unsecured debt in the secondary securities market?  Are you acting in the capacity of a debt collector as governed under 15 U.S.C. §1692?

Remember, this is fraud at its greatest.  Only the top echelon bankers know this scam.  Even their own Counsel do not know the scam that is being perpetrated here.  He is just taking his client’s word at face value.  He is hearing “we bought the note back” and accepts that the bank now has the right to foreclose.  They don’t.  Most homeowners who are confronted with this situation don’t know the scam either and run out of juice.

Do you see how we structure our arguments here?  It was never “Show me the note”.  We are attacking them on the “show me standing” and “show me that you are the real and beneficial party of interest who has the right to enforce the note”.

Carpenter v.  Longan 83 US 271

Why is this so important?  This is a US Supreme Court ruling that says the Deed of Trust is the peripheral, and the Promissory Note is the “Thing”.  Imagine if you will, that the Deed of Trust is the tail, and the Promissory note is the dog.  He who owns the dog controls the tail.  He who controls the tail does not wag the dog.

Your lender will want to come in to lay claim on your title only showing ownership to the Deed of Trust without disclosing who the real and beneficial owner of the promissory note.  This is admissible unless you know to object.  If you quote this law when there is evidence of movement, then this will stop them in their tracks. Basically, it’s the same thing.  “Show me you have subject matter jurisdiction over this controversy”, “show my your proof of claim and title”.  He who controls and owns the promissory note, controls the Deed of Trust.

If your loan has evidence of movement, then you are much more likely to have your TRO granted.

United States Comptroller of the Currency Stop Order (VERY POWERFUL)

Recently, the Comptroller of the Currency issued a Stop order fro all of the top 14 servicers from foreclosing until they have undergone a review of their foreclosure procedure AND all future foreclosures have to verified by an independent third party.  I have included this report in the Reference file (found in Module 1) under: Banks Consent orders

Take a look at this.  Find your servicer listed here (if you can).  Then be sure to enter this as evidence to your case (whether to have the case dismissed in a Judicial process) or filing a quiet title in a non-Judicial process to stop the foreclosure.

Let the judge know that there’s a stop order in place by the agency that controls banking.  And that your “lender” is breaking the law.

You will want to put a Motion for Judicial Notice of these cases and stop orders and attach it to your case…and TRO.  If you don’t know how to do this, use the Memorandum of Law in the Documents as a template.

Click here to see the press release directly from the Office of the Comptroller of the Currency.   <- IMPORTANT.  Seriously.  Do this now.

Get Accelerated Access to the Litigation Modules

Look, we have created our coaching program to drip feed content over time so as to not overwhelm you.  However, in this situation, time is not our friend.  We need to give you access to all the litigation modules asap.

To get immediate access, please email info@consumerdefenseprograms.com and ask for “release of the Foreclosure Defense Modules up to Module 7”.  Modules 4 to 7 should be released to you within 24 hours.  You should jump to Module 4 and go through each of the modules from there asap.  Modules 2 to 3 are for written correspondences.  Unfortunately, these require time.  Time you don’t have.

You should however go through Module 1 immediately.

Also, be sure to watch the Foreclosure Defense Videos.  You need to be intimately familiar with these arguments if you are going to sue your lender.

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Option 1: Filing Your TRO

Now, in addition to filing your civil action (as per Module 7), you will need to customize and file your Motion and Order for a TRO.  To do this, customize:

Disclaimer: You take full responsibility for these forms.  These are just samples.  Use them at your own risk.  Please consult competent legal counsel.

Once you are done customizing these, you should go talk to the Clerk of the Court.  Show her your Motion for Shortening Time.  She will then give you a time for you to plead your case to get an emergency TRO.  Ask her for an “ex parte hearing to have your TRO Motion granted“.

IMPORTANT Call on Filing Bankruptcy

This is VERY HELPFUL if you are considering BK.

Instead of hiring an attorney for $3000 to $5000 to do your BK, you might want to have a BK preparer specialist handle the paper work for you.  Believe me, even for someone like me (who has an MBA), it is extremely complicated.  Despite all my legal education, I still fumble around the paper work involved in my second BK filing.  I DO NOT RECOMMEND DOING BK YOURSELF.  Seriously, just don’t even try. You will tear your hair out.

We have hooked up with an affordable alternative to hiring an attorney.  These guys specialize in helping homeowners file BK and challenging proof of claim by your “banks”.

Tired of Fighting Your Own Attorney For Your Legal Defense?

Look, it is hard enough fighting the bank, but when it comes to getting real legal help, you don’t have time (or money) to spare to fight your own attorney who “poo poo” your arguments, telling you “this stuff never works.”

To make matters worse, these attorneys want to charge you $5000 up front just to LOOK AT YOUR ARGUMENTS.  This is something I’ve personally witnessed myself.  I’ve been trying to find a good attorney I can refer our people to besides prepaid legal…until now, it’s been a futile search.

The other problem with these attorneys is….they charge you between $250 to $450 an hour for this..and they expect you to put up a $5000 to $10,000 retainer to get started.  I don’t know about you, but if I am in foreclosure, I obviously don’t have that sort of money to throw around.  Besides, in a recent study, most attorneys fluff their hours and charge you their $250/hr fees for something they pay a paralegal to do.  It’s just so scary.  Their incentive is to spend all your money up.

If you want to go the BK route, here are links you will need:

In particular, pay attention to rules relating to discovery.  You will need to have a pre-trial conference with opposing counsel first before Discovery may commence.  In other words, you can not send your Request for Admissions and Request for Production of Documents with your service of Summons and Petition.

Pay attention to Rule 26 (f) 1.

If you are declaring bankruptcy and want to fight your lender to have them provide proof of claim, then your best bet is to file an “adversary proceeding”.  An Adversary Proceeding is just like a regular civil action, except it is done under the umbrella of the Bankruptcy Court system.

In our experience, most of the wins we find come from people challenging their lenders in BK Court because of Rule 3001(d).

I would like to reiterate again.  An Adversary Proceeding may only be done under a Chapter 13.

Also, be sure to declare your home as an unsecured consumer debt as this will require your lender to object and provide proof of standing.

If you take a look at the process map: 000-Process Map, you will find that you will pretty much have to get up to speed on the litigation process just like a regular civil action.  However, because you have filed bankruptcy, you will have a lot more time to fight your lender than had you not declared BK.  That said, time is of the essence.  Seriously, you do not want to sit around and twiddle your thumbs.

To proceed with an Adversary Proceeding, instead of using the Quiet Title Action as explained in Modules 4-7, you will want to use the files contained in /BK Method instead from the Documents download file.

If you want to use the BK method instead of the civil action method and you know of the consequences, then by all means move forward.

1) Review the following documents and then customize it to fit your situation:

2) Follow the instructions on how to file for BK at http://www.legalconsumer.com/

3) Pay for and do the credit counseling course at: http://www.personalfinanceeducation.com/  This will cost $30 and take you about 30 mins to do.  You will need this before you file for BK.  This is the cheapest I’ve been able to find and it’s decent.

4) File for Chapter 13 BK.

5) Decide if you want to do the BK for real or for the purpose of this exercise.   This is an important distinction.  For me, I filed BK to get the automatic stay against foreclosure and so I can have time to fight the bank.  I have no intention of completing the process (which is called discharge).  Again, PLEASE DO NOT LIE in BK.  Especially about your assets.  Don’t try to hide things.  If you have a bunch of cash around…then pay off some debts or something.  You can keep $7500 in cash.  They do a 6 month retro look back on your bank account.

6) File your BK with the required paperwork.

7) Then file your Adversary Proceeding pleading.  It is free as a Debtor. You will need to fill in Form_104_0807.  You can find this form in the/BK Method folder.

8) Be familiar with the Bankruptcy Rules of Civil Procedure.  You can find it at /BK Method/Federal Rules of BK.pdf