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United First Financial Money Merge Accounts: Scam or Legit?
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A reader recently sent an email asking about a program United First Financial runs called a Money Merge Account and whether it was legitimate. United First Financial promises that the program, which costs $3500, would have you pay off the mortgage in one-third to one-half the time it normally would take. Knowing nothing about money merge accounts and knowing a little bit more about simple math, I smelled a fat $3500 scam brewing. The only scenario in which I could see $3500 cutting your mortgage in half is if you had a $7000 mortgage. But, setting my mental scam alerts aside, I did some more research about the plan.
Apparently it’s a fancy name for an accelerated mortgage repayment scheme. The first step in the money merge account is to take out a second mortgage on your home, a home equity line of credit. Then, what you do pay your entire paycheck towards the first mortgage and withdraw money from the HELOC to cover your expenses. You save a little money because the interest on a HELOC is calculated based on average daily balance rather than the final monthly balance. This lets you pay off more of the mortgage at the beginning of the month and then be charged less interest on the HELOC. (this assumes the same interest rate, which is a big flaw)
However, the plan also has a lot of other assumptions and flaws.
- It assumes that your HELOC interest rate will be the same as your first mortgage interest rate – very unlikely. The bigger the HELOC rate, the less you save on that difference.
- It assumes a single monthly paycheck so it’s a plan that loses some of its power if you are paid irregularly or every two weeks.
- One big flaw is that there is never discussion of HELOC fees. I’ve never opened a HELOC but I imagine it’s not free.
- This plan requires that you don’t save at all for anything else. Since your entire paycheck goes towards the mortgage and you withdraw expenses, it penalizes you drawing on the HELOC for non-essentials. Why pay $100 towards a 6-7% mortgage and then borrow $100 from a 10% HELOC?
- Finally, as if all those weren’t enough, you have to pay $3,500 for a program to help you do this!?
In researching this article I researched a lot of sites and they were nearly unanimous in their opinion that these types of programs are not worth the money (not surprisingly). They’re not scams in the sense that you pay your $3500 and they disappear into the night but it’s something you can do yourself.
This begs the question, should you use it to force discipline? I could justify paying $100 to enforce discipline because it can save you quite a bit in the long run, if you can overcome the failings, but $3500 is ridiculous. If you have $3500 and you want to pay off your mortgage sooner, send a $3500 check to your mortgage company. (if you want a legitimate and easy way to pay off a mortgage faster, consider making mortgage payments every two weeks)
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WhackAShill you are are wrong on so many things and you never correct the wrong information you post like other people I see do if they make a mistake. But with you I think it is more than making a mistake. I am convinced you are stuck in your own way of thinking about this and you do not understand as much as you think you do about how HELOC interest rates actually work and interact with average monthly balance, about the HELOC as a second mortgage as you and Craig say, that you can get HELOC to replace first mortgage and many other things like 99% of HELOCs are higher than mortgage interest. I do not find anything deceptive except what you write as you think you are authority and know so much when you really do not or you would not be posting so much wrong information and telling other people they are scams. I will say to you what JimmyDaGeek said to Craig, you are flat wrong and you don’t know what you are talking about.
WhackaShill I have learned that when someone cannot back up his claims he starts making things up or starts speaking in vague generalities or starts attacking other people or doing all of these like you have done. I hope maybe you have learned some lessons and you will improve yourself.
JimmyDaGeek thank you for your comments. I will see what Jennifer has to say about this.
Bonhoeffer,
You are a master at attacking the messenger and avoiding the point. Just because I might have a strong stance does not mean the claims I make are untrue. Do you not agree that it is deceptive marketing on the part of UFF to claim that the the HELOC rate does not matter?
Of course it matters!
I understand how the HELOC shuffle is supposed to work, but you do not seem to want to admit that the APR has a direct correlation as to the amount of savings. Would a HELOC APR of 20% yield a different savings/no-savings with the shuffle compared to a 0% APR HELOC? OF COURSE. UFF claims the HELOC rate does not matter, this confuses people into believing that somehow the software is magically saving them money that it does not.
WhackaShill I am not attacking the messenger. I did not call anyone a shill or a scammer. I also am not avoiding the point. You say I should admit that the APR has a direct correlation as to the amount of savings. When did I say it does not. What I said is that that you can find many HELOC APRs lower and not higher than the first mortgage and you say HELOC APR is higher than first mortgage 99% of the time. I also said HELOC is is not second mortgage and you say it is. Even if JimmyDaGeek is questioning MMA he still agrees with me on this in his post to Craig.
I am sorry to say I do not know what point you are trying to make. Craig tried to help you when he said “the point WhackAShill and I were both trying to make, is that the HELOC as commonly used by the MMA, is basically a second mortgage.” But JimmyDaGeek said Craig does not know what he is talking about. So maybe you should tell JimmyDaGeek he is attacking the messenger. As far as deceptive marketing with respect to you I think maybe you are avoiding the point and not me. Do we talk about marketing or if MMA is good is good to use. I will wait for Jennifer to answer JimmyDaGeeks question so we can find out. I did not hear her say HELOC interest rate makes not difference.
Bonhoeffer
I want to clarify one thing. A home equity loan or line of credit is a second mortgage. Home equity loans, as far as I know, always have fixed interest rates above currently available fixed mortgage rates because of their riskier repayment profile. Plus they always have shorter terms. On the other hand, HELOCs always have variable interest rates. I was commenting about Craig’s other assertions.
Bonhoeffer,
The point is that UFF’s marketing strategy is to prey on math illiterate people and make claims that are false (which they know the math illiterate people can’t figure out) in order to sell their overpriced product and make huge commissions.
If you don’t see this by now or are ignoring this I have no choice but to believe that you are some how affiliated with the scam company.
Just look at James Barnes, he came here with his “challenge”. He made claims that were simply false (claims that he trusted to be true because UFF presentations, conventions, and meetings all teach lies to the agents) and when James was proved wrong he just left.
WhackAShill you say if I do not see your point by now I am ignoring this and you will have no choice but to believe that I am affiliated with the scam company and James Barnes left because he was proved wrong.
WhackaShill here are facts. I do not see your point and I am not ignoring anything. You are the one who is ignoring this because you make so many false statements and when they are pointed out you just ignore it and talk about something else making more false statements. I think James Barnes left for same reason I will leave. It is not possible to talk sense with people like you who can make any false statements you want and then accuse other people of lying. There is no defense against you WhackAShill because you are overbearing and will say whatever you want to say even if you know it is not true. I will tell you that you are so convinced you are right that you will say anything you think will help to support your thinking even when you know they might not be true. That is very dangerous. Maybe you should have lived under Ceausescu for some years or maybe you could have worked for him. That is all I have to say.
Bonhoeffer,
What am I ignoring?
You don’t respond with facts, you respond with dibble.
The math “challenge” that UFF agent James Barnes lost proves my points. You ignore this.
The dozens of web sites with nothing to gain by warning people to stay away from UFF, and yet they do, proves my points (just google “united first financial scam”). You ignore this.
The fact that UFF needs 10,000 sales people to sell 100,000 copies of software proves my points (these numbers were presented by a UFF agent, I’m not making them up). You ignore this.
The false statement that is still on UFF’s web site “with little to no change to their day-to-day spending habits” proves my point. You ignore this.
And the classic lie that UFF agents promote: “the HELOC APR does not matter.” You claim they haven’t told you this, however it is on their presentation video that the crank out for every other “potential client”.
Why the ignorance?
If UFF does not constitute a scam by your definition…. what does?
You say that I am “overbearing.” Perhaps this is your perception because you have no answer to my facts that I present.
Instead of analyzing or responding to my points, you simply say you do not get them.
Bonhoeffer, make no mistake, James Barnes left because all the falsehoods he spouted were proven wrong by several individuals who came to the table with irrefutable calculations and facts. He, much like many other shills, move along once they figure out their audience is much smarter than them and cannot be fooled by this scam. If you want plenty more proof of all these shills and hucksters, go here an read this thread:
http://www.fatwallet.com/forums/finance/741118?highlight_key=y&keyword1=united+first
or this one:
http://www.fatwallet.com/forums/finance/767134?highlight_key=y&keyword1=Uff
WhackAShill and Synnyster if I leave this discussion board it will not be because I am spouting falsehoods and not because I have been proven wrong because I will not spout falsehoods and I have nothing to prove so please I hope you will not tell that about me. Why you can say things that are wrong like 99% of HELOCs are higher interest than first mortgage and HELOC is second mortgage and just IGNORE that what you say is not true I cannot understand. This part has nothing to do with math but with integrity. You are too caught up in your math to know how to present yourself. I will listen to JimmyDaGeek because he does not present himself like you. I am not dumb like you think. WhackAShill you say “Perhaps this is your perception because you have no answer to my facts that I present.” You are right about perception but wrong about facts. You do not present facts. The way you present things I do not know what is false and what is true but I do know some is false. For example your false statements about HELOCs. I also do not know if your family owns all those Coldwell mortgage companies. Why you think you have to state things you know are not true to make your point I cannot understand. I know we all our prisoners of our perceptions. Your perception is you can say anything you want but not be accountable. It is your perception that you can do that and make your point. If it is so I would rather make mistake with my math but know I have integrity. JimmyDaGeek made a mistake with his math. He then corrected it. He wants more information from Jennifer. So do I. What you both must understand, and make sure you read this carefully, is that for me the person and how he presents himself will carry more weight in convincing than his claims about himself and about others.
HELOC is a loan tied to your property, often it is in second position behind the first mortgage, many people interchange the term “second mortgage” and HELOC. The main difference being a “second mortgage” is repaid on a fixed schedule, where a HELOC is a line of credit that can be drawn on like a credit card or checking account.
Bonhoeffer, you make it seem as if a HELOC is not tied to a property, you are wrong. It is a loan against the equity in the home, and must be repaid during the sale of a home.
It has been my experience in the past 3 years that for most people it is extremely difficult to to find a HELOC at a lower rate then their mortgage. The main reason for this is the equity in peoples homes are shrinking. It is risky for banks to give HELOC loans because if they foreclose, the HELOC being in second position will not be repaid unless the sale generates enough money to cover both the first mortgage and the HELOC.
Being in second position is much more risky then being in the first position for a bank, this is why generally, not always, a HELOC is at a higher rate then the first mortgage.
Generally if a person can qualify for a HELOC at a certain rate, they could also qualify for a regular mortgage for a lower rate then that. This is a fact.
Here are some interesting points about HELOC’s that perhaps you don’t know about:
http://www.themortgagereports.com/helocs_and_heloans/
Hello All– I am back after being gone for a few days. I see that you need some additional information. I am sorry that I do not know how to post the analysis. I do not take care of my website and the web provider charges me to change things to it.
I have to say that I am learning a lot about spreadsheets and the math behind all of this. I appreciate the chance to dig deeper and see how all this works.
The original analysis that I ran for Bonhoeffer did have his savings included in the over-all picture. I do not know how that effects the day to day actions with the MMA. I will re-run those numbers to exclude the savings. I will also change the HELOC rate to 6% just to see the difference. Anything else?
I do think that it is important to note that either way all this turns out….it still boils down to who is going to follow what. I for one, like to have the MMA software helping me through the day to day, month to month transactions. You guys might be more disciplined then me or most other people in the same boat as me. I think that it’s great that you are able to follow this one time plan for the next 11 years! And I realize that you can simple change your numbers if you decide to make an additional large purchase. I just do not see myself doing that. What about the people that are just like me? Are they not worth your time since we do not even know how to run the spreadsheet like you did?
Anyway…I will post my results later.
Here are my results:
Bonehoeffer’s numbers with the MMA and no savings:
11.2 years and $62,352.88 paid in interest (3.99% Heloc)
11.3 Years and $64,990.19 paid in interest (6% Heloc) This is just to show the difference
I am also wrong about another thing. This is not including the cost of the software. This is only interest paid on the whole principle balance, which includes the cost of the software. That gives an overall different of:
$62,352.88 – $58,363.80 = $3,989.08 increase in interest paid while on the MMA ( Is that because of the interest charged on the $3500)
This give me the conclusion that it would cost Bonehoeffer $3989.08 (in interest) and $3500 (software charge) more in going with MMA.
A total cost of $7,489.08 for the use of the software. Is that worth it? For me, yes.
I have learned a lot here. I can’t say that it has changed my mind about the value of using a tool that will guide you in eliminating thousands of dollars of debt. It also has solidified anyone’s doubt that the MMA is NOT a scam. It is obvious that it works and will perform as explained. The only difference, for some a huge different, is that it saves them money to do it on their own without the software.
That has been proven to me…once and for all. Thank you for taking the time to do that.
I can honestly say that I will be telling my clients exactly that. You CAN do it on your own and come up with a better result. But if you need a tool to help you, the MMA is a great educational, hands on tool that can help you make some financial decisions that we all need to make on a daily basis. Mine change monthly.
JimmyDeGeek, sorry for making you scratch your head too much.
Bonehoeffer—Good luck with your goals!
WhackAShill said:
“Being in second position is much more risky then being in the first position for a bank, this is why generally, not always, a HELOC is at a higher rate then the first mortgage.
Generally if a person can qualify for a HELOC at a certain rate, they could also qualify for a regular mortgage for a lower rate then that. This is a fact.”
*****
Those are the two only points I was trying to make above. Sorry if I mislead anyone with that post.
Jennifer, it is good that you are trying to learn mortgage math. Would that not have been a good first step, before advising people on their mortgages? This is very worrying – with no financial background, you are about on par with many of your fellow UFF agents.
As for spreadsheets, why use one to prepay your mortgage? It’s useful for forecasting purposes, but you don’t need it. The mortgage company sends you statements, so you know what you owe. All you need to do is send whatever extra you can to the mortgage, while setting aside some contingency money.
That’s the plan you follow for 11 years. Send what you can to the mortgage. That’s it. That’s all you need to do to beat the MMA.
If you need a plan, create a budget. Every family should have one. Quicken and MS Money are excellent tools for this purpose, will import your bank account info, and cost less than $100. Clamping down on money spent will save many families a lot of money once they see how much they spend in some areas.
A spreadsheet is only necessary for a MMA vs. DIY comparison.
It amazes me how many people need everything told to them like their were a child. If you have a mortgage and own a house, I assume you are an adult and have atleast a little inkling of responsibility and common sense.
Easy steps to pay off your mortgage early (FREE PROGRAM!):
1. Pay all your bills.
2. After paying all your bills and setting aside your mortgage payment, you are left with discretionary income (excess income you can do with what you want).
3. You can now use all or any part of that discretionary income to pay down your mortgage. The more you discretionary income you pay each month, the faster you pay your mortgage off. Surprise surprise huh?
4. So you ask, how do I know how long it will take when I make these extra payments? To find out, use ANY of the free online mortgage calculators. They will create an amortization table and tell you exactly when it will be paid off after paying X amount more. I prefer this one:
http://www.bankrate.com/brm/mortgage-calculator.asp
See how easy that was? You didn’t need to spend $3500. You didn’t need to keep track of every last penny. You didn’t need to juggle a HELOC or a credit card. All you needed was some common sense. It really is that easy folks.
Jennifer,
I believe that the majority of the people that buy the software do not realize how easy it is to do a simpler method on their own.
UFF creates an illusion that paying off your mortgage early is difficult and requires complicated algorithms. Just look at James Barnes, he came here stating that nobody could outperform the software, clearly he was wrong.
Your argument that people might follow the software more than a spreadsheet is questionable at best because the majority of the people that use the software were tricked into believing that they could not do it easily on their own.
@ All:
Ok I’ve been just sitting here reading away, but now once again I have something to say…
In theory, it may be simple to pay off your mortgage, but in reality most people don’t have the discipline and follow through.
The more complex your financial position, the harder it is to figure out the timing on your own.
I strongly believe in my individual case the MMA beats the do it yourself method hands down! My software is saying I have 2.75 years left to pay on my mortgage and I have plugged in my discretionary income into a mortgage calculator and it CAN”T beat the MMA. I’ve even given the mortagage calculator a head start. I put in $500 of discretionary income applied to principal from the start of my loan, when in actuality the MMA software didn’t start until year 2 and 4 months. It doesn’t even come close to 2.75 years left. I think this is because of my complex finances, my income and how I pay my bills (as many annually as I can etc. use the credit card to pay all monthly expenses and then pay it off each month etc.) the MMA can work out a better deal for me. Again, that’s why I purchased the software.
What’s so complicated about paying your higher interest debts first?
That’s the formula.
Want to do even better? Consolidate high interest debt into a lower interest loan or line of credit. Then – you guessed it – pay your higher interest debts first.
As for “strongly believing” the MMA beats DIY hands down, do you really think your case is so unique that the laws of mathematics have been suspended? See the results of James’ challenge above. Go through the links to other challenges, posted above. DIY will beat the MMA in any realistic case. Any change in circumstance that helps or hurts the MMA will help or hurt the DIY approach, and vice-versa.
I understand there is a strong need to believe in something you paid $3500 for. But this is math – not religion. You can’t say you “believe” that X>Y. You have to prove it. UFF agents can’t do that. First of all, some are just learning mortgage calculations for the first time.
I agree that you do not need to be a math whiz or spreadsheet jockey to pay down your mortgage on your own. You have 2 choices on how to do it:
1) Pay all your bills and send in what is left at the end of the month
2) Pay a predetermined amount each month. Adjust this as necessary.
In both case, you need to have a HELOC if you don’t want have an emergency fund with cash sitting idle. And if you borrow from the HELOC, it must be paid off first before paying off the mortgage.
I only created the spreadsheets to show people how the cash is accounted for. If people want to know when their mortgage will be paid off, all they have to do is get the latest copy of their mortgage statement and look up their balance on an amortization table. The table will show when the mortgage is paid off. THE TABLE NEVER CHANGES because it is based on the original balance, term, and interest rate. Making extra payments on the mortgage balance just moves you down the table.
How can you say the table never changes? If you make a principal only payment of say $10,234.01 how can this move you down the table because its not exactly equal to a principal payment? Does it just move you down the table how ever many principal payments it equals plus a portion of one?
Anonymous said:
“The more complex your financial position, the harder it is to figure out the timing on your own. ”
This is exactly what UFF agents want people to think, the truth is, timing has little to do with it. Pay off your high interest debt first, then your second highest… etc….
UFF agents will have you believe that there is a magical algorithm to find out the best way to pay off your debt, however, it is not difficult at all.
Anonymous said:
“Does it just move you down the table how ever many principal payments it equals plus a portion of one?”
Yes thats exactly what it does, have you ever seen an amortization table or know how it works?
WhackaShill you said, “Bonhoeffer, you make it seem as if a HELOC is not tied to a property, you are wrong. It is a loan against the equity in the home, and must be repaid during the sale of a home.” This accusations does not make sense. A HELOC is a home equity line of credit as everyone knows. By definition this means it is a line of credit against equity in the home. Yes if there is a balance on HELOC it must be repaid when you sell the home. No arguments on these points. Please tell me how I make it seem this is not what a HELOC is. How did I say this?
You also say, “It has been my experience in the past 3 years that for most people it is extremely difficult to to find a HELOC at a lower rate then their mortgage.” I cannot tell you about your experience but for me in the last month I found many and I even gave you a link for one for 3.9%. I cannot speak for most people so you may be right on this point. I cannot know. All I know is for me it is easy to get HELOC interest for less than my mortgage interest and many banks offer lower rate.
You also already said “99% of HELOC’s are at a higher APR then the mortgage APR. Can you tell me what bank is offering HELOC APR at prime -1?” I already told you and even gave you a link. There are also many others. Now you are changing this to say for most people it is hard to find a HELOC at a lower rate than first mortgage. Which is it, banks not offering HELOC at lower rate or most people cannot get lower rate. Do you see how these are different.
You also say “Generally if a person can qualify for a HELOC at a certain rate, they could also qualify for a regular mortgage for a lower rate then that. This is a fact.” Let me understand. Since I qualify for HELOC at 2.9% for first 6 months and then 1% below prime I can also qualify for a regular mortgage at lower rate than this. Is that what you are saying? If I could do this I would get lower mortgage rate tomorrow. Can you give me link for bank that will do this for me.
Bonhoeffer thank you for not ignoring all of my points this time.
I do say generally because it is not always the case, your case may be an exception, but not the norm. Did you read my linked page that explains how HELOCs can be dangerous and falsely advertised and misleading? You say that you qualify for a 2.9% but you actually haven’t received this HELOC account yet so you really don’t know for sure if this is true. I ask this because you did not respond to the link I posted about HELOCs.
Does it not make sense to you that a HELOC is more risky for a bank, which leads to higher rates, because they are in second position to collect in a foreclosure event? You ignored this point and like usual did not respond or acknowledge it.
You might be out of touch with the banking industry but I have witnessed bait and switch firsthand. The reality is you don’t usually get something for nothing. A HELOC rate at 2.9% is extraordinary and I would not be surprised if there was a catch to it.
WhacAShill I read your linked page. What do you want me to respond to. It shows how prime rate has changed over the years. Everyone knows prime changes so if that is how you want me to respond that is my response. What you say is that it explains how HELOCS can be dangerous and falsely advertised and misleading. This is what you also say about UFF and I would say yes, both CAN be falsely advertised. So can everything else that is sold. What is your point. First UFF is scam to you and now HELOC is scam.
The HELOCs I can get are many from banks but only one I found for 2.9%. Others are 3.9% or 4.4% at highest in my area for introductory rate. I also showed you the link from AIC where you can get HELOC for 3.9% The catch to the 2.9% rate is that it is introductory and will change to prime minus 1 % after 6 months as I have said many times. It is not something for nothing. The bank gets paid interest.
You also say “does it not make sense to you that a HELOC is more risky for a bank, which leads to higher rates, because they are in second position to collect in a foreclosure event? You ignored this point and like usual did not respond or acknowledge it.” If anyone is ignoring points it is you. You do not respond to much what I ask of you. I will not ignore this point. Whether it is riskier for bank or not I do not care. All I know is that you can get HELOCs I know about for NOT higher rates but lower. What is your point saying because it is riskier for banks that that it leads to higher rates if it does not lead to higher rates from what I know and from what I have already sent to you.
Bonehoeffer once again you are missing the point,
The rates that you have shown 2.9%, 3.9%, 4.4% etc are advertised rates, they mean nothing. You do not “know” you can get these rates.
Its like a car ad, you see a new car advertised at $12,000. Once you get to the dealer and actually sit down with a salesman you don’t know what the actual price is. Quite often that $12,000 is suddenly $18,000.
I don’t know what Whakashill & Craig are trying to do. Everything that I have seen on interest rates show:
Home equity loan (second mortgage), fixed >
First mortgage, fixed >
First mortgage, variable >
Home equity line of credit (second mortgage), variable
They keep talking about facts. Hmmm, every fact I have seen at bank websites show me the above facts. I have no idea where they are getting their facts. Maybe we can do some fact-slinging or have dueling URLs.
WhackAShill~
Yes, I’ve seen an amortization table, but I didn’t realize it worked in the way you describe.
In addition, I don’t have any debt except for my house all other debt is paid off. All I have are recurring monthly bills.
I think it is about timing because it sure makes a HUGE difference if you make a large lump sum payment near the beginning of a loan term vs. making a large lump sum payment near the end of a loan term. The difference is in the amount of interest you end up paying.
Jimmy I don’t know either we kind of got on a tangent point that has little to do with UFF.
I believe Bonhoeffer is convinced that since his quoted HELOC APR is 2.99% that the UFF shuffle somehow outperforms do-it-yourself.
However in this instance do-it-yourself could be modified to incorporate the low HELOC rate – not that difficult to do, just transfer higher rate debt to the low interest HELOC.
I would be interested to see a comparison if anyone is up for doing another scenario, I believe do-it-yourself would easily still outperform UFF because of the high price tag of $3800 (up from $3500).
WhackaShill I am not missing any point. I know for a definite fact I can get that rate. I went to the bank and sat down with the bank officer. Do you think I would be so dumb to say something I can get without actually knowing I can get that rate. I have compared many banks and I have talked to bank officers in person at 4 different banks. These are all small banks with not many branches. I have been approved for these rates. All I have to do is sign the contract. So you do not come back at me with more things I do not know I want to be clear. These banks have no application fee for me, no closing cost I have to pay and they will all pay appraisal fee. My credit rating is excellent. One bank will give me 2.99% HELOC for first 6 months then 1 % below prime after that as I have said many times. Other banks will not give me 2.99% but some will give me 1% below prime after 6 months and some will give me 1/2% below prime and one will give me prime. No bank of these 4 is more than 4.4%. One I can get HELOC for $40,000 and others for less. I have also sent you the AIC link where 3.9% HELOC rate is advertised. It is not in my area so I have not talked to AIC bank in person but I did call on telephone to verify but no I was not approved for HELOC at his bank. I hope I have covered everything so you will not again say I am missing a point.
I am not like you. I talk only about what I know and what I know I can get not what most people might get or if advertising is misleading. I will deal only with facts I know absolutely are true for me and you deal with what you think or what you want people to believe and not what you know for a fact.
Jimmy DaGeek thank you. I also have no idea where WhackAShill or Craig get their facts. As I said before I think WhackAShill comes up with facts from thin air because when I confront him on his facts he changes the subject and tells me I don’t understand something instead of showing how he gets his facts.
Anonymous said:
“I think it is about timing because it sure makes a HUGE difference if you make a large lump sum payment near the beginning of a loan term vs. making a large lump sum payment near the end of a loan term. The difference is in the amount of interest you end up paying.”
This is a classic UFF myth, derived to separate people from $3800.
When you make a huge lump sum payment from your HELOC, you still have to pay interest on the HELOC, often at a higher rate. UFF would have you believe that this is the most effective strategy – it is not. UFF has you pay off the HELOC over time, and then puts another lump sum towards the first mortgage once it decides the HELOC balance is low enough.
Instead of paying a lump sum, one can simply pay extra each month gradually towards the mortgage. There is no benefit to paying a huge lump sum upfront because you are still paying interest on that lump sum. In doing it the easy way you almost always see better and faster results because you do not have to pay $3800 for a software program.
Anonymous,
WhackaShill wrote “There is no benefit to paying a huge lump sum upfront because you are still paying interest on that lump sum. In doing it the easy way you almost always see better and faster results.” The key is the phrase almost always. This is his out. WhackAShill sets up his own thinking about who is using the HELOC and his own thinking about the HELOC interest rate and if you challenge him on these he does not answer. Instead he tells you that you do not understand something or that you are missing a point. You should check this out for your own situation and be careful not to assume you are in his almost always category. Also see what Jimmy Da Geek is writing when he says he has no idea where Craig and WhackAShill are getting their facts.
I think I understand now, the huge payments do help pay down the mortgage but you still have to pay interest on the HELOC. I ran some rough numbers on my own and it shows UFF will cost me about $10,000 more then doing it myself.
Bonhoeffer,
I should have been more clear, doing it yourself is always more efficient, but in your scenario you would be more beneficial to take advantage of the HELOC rate – not use the software – but adapt a do-it-yourself method to incorporate the HELOC.
All you have to do in your scenario is transfer all your higher rate debt to the HELOC and this will outperform the UFF software.
Anonymous excuse me for being suspicious. What rough numbers did you run? On what premises did you run these numbers? What did you use for HELOC interest rate? Could you please share with us how you actually ran your rough estimate and what you were comparing your numbers to.
WhackAShill I am the one who should have been more clear. I cannot trust anything you say because I have caught you in too many wrong statements. Jimmy DaGeek is right. I also have no idea where you are getting your facts.
Well now that I understand how the program works, I made a spreadsheet to replicate the money movements. I can’t qualify for a HELOC because I do not have much equity anymore since the economy went bad. I had an analysis run with a UFF agent using a credit card that I already have. If I skipped using the credit card and the software and just paid off my high interest debt first and so on I come out $10,00 ahead of UFF.I figured out that the $3500 is really costing more because of the interest it costs over time.
Jimmydageek also said:
“Even with changing expenses, you don’t need software to pay off a mortgage. With a HELOC as a backup, you can borrow on it if you have a shortfall and then pay it off immediately.”
Bonhoeffer, If you don’t believe me will you believe Jimmy?
Financial ignorance is the ultimate (and perhaps easiest) weakness for scammers to exploit. It is sadly amazing to me the number of people who are so easily duped by lies and psychological manipulation into financial scams like these.
Tell them what they want to hear, make up some lies, leave out all the most important financial details, and releive them of $3,500… it’s a printing press.
It’s really quite sad… and an indictment of the general public’s financial education.
Despite copious proof from every angle that the HELOC b/s is more costly, more risky, less efficient, and in general a bad idea… despite exposure of the lies and misrepresentations, despite proof that the schemes are worthless… there are still those who want to believe and/or justify their bad actions and bad choices.
Here’s some straightforward honest advice for those who want to understand:
“Predators Among Us” http://kuzenovich.com/articles/79/1/Money-Merge-Accounts-Predators-Among-Us/Page1.html
In case you haven’t heard these yet:
http://www.youtube.com/watch?v=IQKPwT1jXuI
http://www.youtube.com/watch?v=viuUY47wLjs
Both are packed with good common sense that some despirately need.
Plain and simple the MMA SCAM is a total waste of money!
Read “Smoke and Mirrors”
http://www.theage.com.au/news/property/smoke-and-mirrors/2004/09/28/1096137225560.html
Jimmydageek also said:
“Also notice that these rates are for 80% LTV. No bank in its right mind is going to give a 100% LTV HELOC at any decent rate. And, finally, none of these HELOC rates are fixed. Given the current economic times, I don’t expect these rates to stay where they are. I am sure that people using CMA are ecstatic with their low rate, but wait until after the election and inflation needs to be fought.”
again, if you wont listen to me listen to you boy Jimmy.
WhackAShill, JimmyDaGeek said “notice that these rates are for 80% LTV and not bank in its right mind is going to give a 100% LTV HELOC at any decent rate” because you and Craig kept saying HELOC is second mortgage. JImmyDaGeek has probably left this discussion board for the same reason I will. It is because people like you trying to prove your point think you can bring in all kinds of claims and wrong information. You forget that he also said he has no idea where you and Craig are getting your facts. I will say that every time I show you that your facts are wrong you talk about something else and tell me I don’t understand something instead of addressing what I tell you.
Fletch your first link about Predators Among Us has no numbers at all. You are not comparing any values or any interest rates. It is a general discussion that is opinion and you can find these kinds of general discussions about anything on market.
Fletch I listened to both YouTube links. Dave Ramsey says “does this system work yes. So we can’t call it a scam.” Yes Dave Ramsey says most people do not need it but does not say it is scam like you do. He also does say UFF is lying but that is his opinion. He does not compare real numbers just gives his opinion.
Your last link goes into Australian problem. In this link it says Carolyn Bond and Roslyn Hunter made 50-page report on “mortgage reduction schemes” and line-of-credit loans for the Australian Securities and Investments Commission (ASIC). I already read every page of that report. Did you. It talks about many examples of people who were sold bad products. It gives real life situations. Not one situation is same as MMA that I have studied here. There bad agents charged extra fees or made homeowner get large second mortgage and many other things that is not the same as MMA as I have read about it in this country. So anyone giving this comparison is not checking facts and probably has not read 50 page report but it seems to back up his opinion so he gives it.
I think maybe you read what other people say who agree with you and not study it for yourself. I cannot say this for sure but I can say when you make your statement “Financial ignorance is the ultimate (and perhaps easiest) weakness for scammers to exploit” that you are showing your true self. I do not disagree with your statement in general but you cannot make this apply to something when you have not actually researched facts yourself that you present. You are guilty of leaning on what others say whether it is true or not and whether it applies or not. It is ultimate demonstration of person speaking from bias and personal opinion. I think that is why others on this discussion board just give up and move on and why I probably will too. I think this is also why Jimmy DaGeek said WhackaShill and Craig are making no sense at all and he probably has left.
So I think you and WhackAShill and Craig should have a party together and maybe you can build each others self-esteem by telling each other how smart each of you are and how dumb everyone else is.
Typical UFF agent, Bonhoeffer you are so blinded by your greed you lost your common sense. How much evidence do you need to admit UFF is a scam?
We should all just let Bonhoeffer waste his money as he chooses fit. Some people just won’t listen and can’t be helped. After all the links and presentations, he still believes in this system.
Bonhoeffer, nobody is saying the MMA system doesn’t work. What everyone is saying is the way it is marketed is untruthful, and the service it provides is easily replicated and beaten by doing it yourself, either by prepayment with or without a HELOC.
Do you know who Dave Ramsey is? He isn’t just another online guy. And why do you only respond to the posts with as you say “no numbers’? There are plenty of links posted to actual examples with numbers, with analysis, with amortization tables, with monthly breakdowns.
For once, lets use common sense…as I said earlier. If you owe X over a period of time. You can pay it off earlier by paying more per month. MMA tells you, increase X by $3500/$3800 and we’ll tell you to pay more every month. Common sense says, you can pay more by yourself by using more discretionary income or by using the HELOC method. Do you really need to pay MMA to tell you to do that?
Is it that hard to list out your debts by highest interest rate to lowest and pay off the highest first and pay minimums on everything else and continue to do so until it is all paid off?
Every MMA supporter wants to make this out to be rocket science. Simple mathematics and common sense is not rocket science. But if you still cling to the idea that MMA somehow magically circumvents math then use it to your heart’s content. Just know you have paid more to accomplish what you could have done on your own and done faster.
JimmyDaGeek said:
“Here is a link showing how MMA loses, using their own numbers (blue), vs. doing it yourself (green):
http://spreadsheets.google.com/ccc?key=pszjmlNnSFKhwM90Q3dWHVg&hl=en
MMA loses for 2 reasons:
1) Inefficient HELOC shuffling has you keeping a large balance for an entire month in the HELOC, costing you extra interest.
2) $3500 fee will not be recouped compared to simply doing it yourself.
This is not to say that MMA won’t work as advertised. But you can do better on your own.
Paying anyone to help pay down a mortgage is for the financially undisciplined and mathematically illiterate. If you can’t stick to a budget unless you have a nanny, buy the software. Rich people, busy making money, are used to paying someone for services that they won’t or can’t do themselves. Poor people are too busy wasting time and money to understand why they don’t need to pay for this service.”
Bonehoeffer, since you have learned to trust Jimmy, I suppose you would agree with his above statement that he posted on this board.
WhackAShill,
JimmyDaGeek’s analysis assumes a HELOC interest rate of 8.6% and a first mortgage of 6%. Again, this is not comparing anything to my situation. WhackAShill why don’t you send me a link comparing first mortgage of 5.75% and HELOC interest rate of 2.9% for first six months and then 5%. It might be more and it might be less that 5% after six months but we can use this for comparison. This way we will be comparing apples to apples. Send me these figures and I will look at it. You know from other posts how much is my original mortgage and how much it is. I will look forward to getting this instead of more statements about what I don’t know or what I will not accept.
Bonehoeffer said:
“WhackAShill I think you are right if as you say the UFF salesman is taking advantage of people who don’t understand mortgages.”
Did you change your mind on this point or do you still agree?