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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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Bonhoeffer,
We cant truly analyze your situation because you have not posted an analysis from UFF as James Barnes did.
Bonhoeffer said:
“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.”
Of course you will save some money transferring some of your higher interest debt to lower interest debt. Again, JimmyDaGeek and almost everyone else admits that you do not need software to do this.
Your asking me to create a spreadsheet but I cant compare the spreadsheet to anything since you have not posted an analysis from UFF. Why don’t you post this and we can compare apples to rotten apples.
WhackAShill you are trying my patience. I posted everything and you saw the analysis Jennifer did. That is all I have. No I did not change my mind. IF UFF salesman is taking advantage of people who don’t understand mortgage they are doing something wrong. So is every other salesman for every product who tries to take advantage of people because they don’t understand something. I did not see that UFF agents on this discussion board were trying to take advantage of anybody.
I am tired of this. You again take one statement and think you can tell me I am changing my mind because you don’t read it right. But you totally ignore all the wrong information you post that I point out to you and you do not even comment on that. Instead you pull one statement I make and you think you can catch me on something. Now I am waiting for your analysis with everything I have posted. I am not interested in somebody else with a different situation. I am only interested in my situation. Please give me your numbers. You know my discretionary income. Compare your numbers to Jennifers analysis. She did two based on two different HELOC interest rate assumptions. Now it is time for you to show how your math works instead of making all kinds of examples or sending me to opinion links. Like JimmyDaGeek says let us deal with facts please.
Jennifer Said:
“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.”
Wow, somehow I missed that post by Jennifer.
Becuase you got such a good rate on your HELOC Bonhoeffer, you are only out $7,489 by using the scam software.
Imagine if your HELOC was closer to the norm… around 5%-8%.
I guess this proves my point that generally the software comes out about $10,000 behind doing it yourself.
I guess I don’t have to run a scenario since Jennifer already did it.
Bonhoeffer said:
“IF UFF salesman is taking advantage of people who don’t understand mortgage they are doing something wrong. So is every other salesman for every product who tries to take advantage of people because they don’t understand something.”
Its not only the salesman that are making false accusation or doing “something wrong.” During “training” UFF agents are taught outright lies. The people training these new agents create an illusion of how valuable the software is and how difficult it is to pay off your mortgage on your own. Many agents do not know anything about mortgages or debt and believe everything they learn in training..
You see Bonhoeffer, its not just the salesmen, its the company itself. When you have a history of agents that are continually misleading and using the same lies over and over, they learned it from somewhere….
WhackAShill please let me see your math to show when I would pay off my loan according to your system with my discretionary income. Then we will have something to compare. As you well know the $7489.08 cost is not compared to payoff of loan with your system. Let me see your math as I said.
You still will not admit all the wrong things you have posted that I pointed out to you. On these points you are totally silent so what am I to think of you.
Please list these “wrong things” and please show proof, not your opinion, that they are wrong.
Bonhoeffer, can I see your UFF analysis so I can make sure the same variables are used?
WhackaShill you said
“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.” This is wrong.
You said “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.” No this is not a fact. It is wrong.
You said, “99% of HELOC’s are at a higher APR then the mortgage APR.
The problem is 99% of HELOC accounts are at a higher APR then the first mortgage.” This is wrong.
You said, “The system does not do what it says it does, you know that!!” This could be debatable depending on what you mean but most everyone I have read who is against MMA say yes it will do what it says but you can do it yourself so I might give you this one.
How about we call a truce. Just give me your numbers from our math with no HELOC and how fast I can pay off my mortgage using your system and my discretionary income and we will see how that compares to 11.3 years from Jennifers analysis. If you can show me how I can beat this I will say you win the argument.
Here is my information again. Mortgage is 5.75% for $185,000 that I took out in June 2005. My monthly mortgage payment is 1079.61. My salary is paid not bi-weekly but 2 times each month so 24 payments per year. Bills average $3785 per month with house payment. This includes tax and homeowner insurance I don not escrow. Net income is 2251.66 each pay day or 4503.32 per month. I have discretionary income of 718.32 per month.
Thank you I look forward to getting your numbers.
WhackAShill sorry I missed your next post. First, I think I already showed proof about where you are wrong so I will not repeat that. Also as I said before I do not have UFF analysis only what Jennifer says. Peace my friend I look forward to getting your numbers and seeing how you respond to my list of wrong things you requested.
Let’s get this HELOC thing squared away.
A HELOC is a second mortgage. What do I mean by a second mortgage? Because of order that creditors are in line to get paid off if you can’t pay your debts. What people commonly call their mortgage is also known as a first lien. Anyone who has a lien on your home can force you into foreclosure if you don’t pay your debts, but the first lien gets its money first, the second lien (second mortgage), etc.
OK, let’s go on.
Let’s say you have an extra $1000 and you decide pay down your mortgage balance. You could just pay it directly against your mortgage and be happy or, according to MMA and other similar programs, borrow a lump sum from the HELOC, pay *that* against the mortgage and use the $1000 to pay down the HELOC.
So, does that work? Before I answer that, you must remember that you only have $1000 extra. So, if you borrow money from the HELOC, you have to pay the HELOC interest out of the extra $1000, reducing the amount of money you have to pay against principal. Another way of looking at it is that you pay the $1000 against the HELOC balance, but let the interest accrue. You get the same result, regardless. That is why it is impossible to borrow against a HELOC without some discretionary income to at least pay the interest. Otherwise, your balance increases, instead of decreasing – not good.
So, with the oft-used $200,000 @ 6% for 30 year mortgage, you pay $231,676.38 in interest. If you pay $1000 against the mortgage, you pay off the mortgage in 10.16 months and pay $67,408.24 in interest.
Can the HELOC do better? There are two ways of using the HELOC. First, borrow a lump sum, pay it down and keep doing that until the mortgage is paid. Second, borrow a lump sum and only pay the interest, pay down the mortgage and pay the HELOC off after the mortgage is paid off. Which is better? Ignoring interest cancellation, it depends on interest rates. If the HELOC rate is less than the mortgage, than the second way is better because the lower rate lump sum is not paid until much later. If the HELOC rate is higher, than the first way is better because you don’t have as much outstanding over time.
But, if the HELOC interest rate is lower, it’s a no-brainer to borrow as much as you can and pay the lower interest. But you risk having to pay it off if the rate rises. If the rate is already higher, why would you want to use a HELOC and pay higher interest? Because of interest cancellation.
Interest cancellation, using your income to temporarily offset your HELOC debt, has its limits. The maximum cancellation that can occur in any month is equal to: (take home pay) * (cancellation rate), where “cancellation rate” goes from 0% to 100%. I remember reading somewhere that the average MMA client has a cancellation rate of 30%, which means only about 1/3 of the take-home pay can cancel the HELOC balance. So, if your mortgage rate is 6%, interest cancellation only saves money on HELOC interest rates below 9%.
So how does MMA or other products figure in all this?
MMA will not beat doing it yourself, PERIOD. If MMA projects a certain discretionary income and you use that value in a mortgage calculator, you will get a projection that will pay your mortgage off as least as soon as MMA and for less total interest expense. So why do MMA examples show you saving money faster than doing it yourself? Because they don’t show you 2 numbers. Total indebtedness and total interest paid. Total indebtedness refers to the total amount of money you owe in your mortgage and HELOC), while total interest paid refers to the interest you pay for your mortgage and HELOC. As long as the HELOC interest rate is at least as high as your mortgage, both these numbers will always be greater, even as MMA shows you your mortgage balance going down and the “small” amount of HELOC interest paid.
Yes, MMA does borrow a large lump sum and pays it down, and it uses interest cancellation. But because MMA does not bring the HELOC balance down to zero in any month, it costs you extra interest for each $1 left in the HELOC all month. MMA’s claim of flexibility costs you extra.
In case you think I am lying or making things up, here is a link to an INTERACTIVE spreadsheet that anyone can play with. It is currently set up with Bonhoeffer’s numbers, but that can be changed. http://spreadsheets.google.com/ccc?key=pszjmlNnSFKgsNpkCb9sHSg&hl=en
How do I know the spreadsheets are correct? Because if you set the do-it-yourself and HELOC interest rates to the same number, you get the same total interest paid at the bottom You also see that the DEBT, on the far left, is identical. In other words, moving money around with the same interest rate gets you nowhere.
The yellow cells are meant to be changed. The DIVISOR approximates the effectiveness of interest cancellation and is currently set up for 30%. If you set it to 1, that means no interest cancellation, 2 is 50%, 4 is 75%
I said:
“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.”
Bonhoeffer said: “This is wrong.”
Bonhoeffer, I get HELOC advertisement offers almost every day in the mail from different banks. They do mean nothing because you still have to meet strict criteria to even get close to qualifying for the advertised rate. Right now I have 95% LTV on my home, I still get advertisements for 3.5%, 4%, etc…. There is no way I could get a HELOC at that low of rates because of my LTV. I still believe most people do not qualify for these low rates…. perhaps 99% was a little high, but with the way the real estate market is across the country, many people do not have a lot of equity in their home anymore. Without a good amount of equity and a great credit score you cant qualify for these low rates.
If you would like to show proof that this is wrong please do, your “this is wrong” comment does not constitute proof. And your links to bank advertisements does not prove my above statements false.
Bonhoeffer said:
“Here is my information again. Mortgage is 5.75% for $185,000 that I took out in June 2005. My monthly mortgage payment is 1079.61. My salary is paid not bi-weekly but 2 times each month so 24 payments per year. Bills average $3785 per month with house payment. This includes tax and homeowner insurance I don not escrow. Net income is 2251.66 each pay day or 4503.32 per month. I have discretionary income of 718.32 per month.
Thank you I look forward to getting your numbers.”
I will need some time for this as I am going out for the night.
WhackaShill you said
“I get HELOC advertisement offers almost every day in the mail from different banks. They do mean nothing because you still have to meet strict criteria to even get close to qualifying for the advertised rate. Right now I have 95% LTV on my home, I still get advertisements for 3.5%, 4%, etc…. There is no way I could get a HELOC at that low of rates because of my LTV.” WhackaShill it depends on how much you are getting for your HELOC. I know for a fact it is not your LTV that determines if you qualify for a HELOC with a good interest rate unless you have NO LTV. It is your credit rating. You are mixed up on this. You can only get a HELOC equal to the amount of equity you have in your home. If you owe $200,000 and your home can get appraisal for $220,000 you can get HELOC for $15-20,000 if you have good credit rating – not great but just good.
You also said “If you would like to show proof that this is wrong please do, your “this is wrong” comment does not constitute proof. And your links to bank advertisements does not prove my above statements false.” I already told you I can get HELOCs at 4 different banks at these rates. All I have to do is sign the contract. This is not advertisement it is talking to the bank officer. Maybe you can also talk to some bank officers if you have good credit then you will have your own proof. I do not think that 99% of people have bad credit and zero equity in their home.
You also said “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.” Can you comment on this. It is not a fact. If you think it is please tell me where you can do this and I will refinance my mortgage at rate lower than 2.9%. This one you ignored.
I look forward to getting your numbers.
JimmyDaGeek thank you for the spreadsheet. I want to study this carefully but I have a question. To make sure I understand you are saying that with HELOC of 4% following your plan I can pay mortgage off in 132 months and if I just apply discretionary income to principle every month with no HELOC I pay mortgage off in 141 months. Is this correct? Where does figure in blue spreadsheet of $4503.32 for extra on principle come from and where does $5221.64 to start paying on principle come from? Thank you.
I made a spreadsheet, much rougher looking then Jimmy’s, I came out with 132 months as well.
http://spreadsheets.google.com/pub?key=pkL2CxdWBIq6A8UXZx3NuWg
I took the 40,000 HELOC at 4% that Bonhoeffer said he qualified for and used all $40,000 to pay down his existing 5.75% mortgage.
Then I used all his leftover money, after paying the HELOC interest of $133.33 per month, to pay down the 5.75% 1st mortgage.
132 months to pay off the mortgage and the HELOC.
DIY beats UFF again.
WhackAShill I made a mistake when I said “I know for a fact it is not your LTV that determines if you qualify for a HELOC with a good interest rate unless you have NO LTV. It is your credit rating.” You do have to have some LTV. For the bank that will give me 2.9% it is 85%. My apologies. I still think it is wrong to say 99% of homeowners would not qualify for this rate.
I said:
“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.”
Bonhoeffer said: “Can you comment on this. It is not a fact. If you think it is please tell me where you can do this and I will refinance my mortgage at rate lower than 2.9%. This one you ignored.”
Again it goes back to the position that the bank has. A mortgage creates a lien on your property. A bank would rather be in 1st position (first mortgage) in case of foreclosure, they have a better chance of getting paid then a second position lien (second mortgage or HELOC).
I’ll say it again as I am confident in my statement: “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
Bonhoeffer said: “I still think it is wrong to say 99% of homeowners would not qualify for this rate.”
Maybe not 99% but a higher number than you think. LTV has a lot to do with it because banks have been getting screwed lately because of the bad real estate market. Banks don’t want to lend out money they don’t think they can get back. Foreclosed houses are selling between 40-60% of their appraised value. Banks are freezing HELOC accounts because of this. One of the main things they look at is your LTV. The more equity you have the better rate you can get.
Lets stop focusing on statements that don’t have much to do with UFF and focus on how easy it is to beat UFF. Did you see my spreadsheet?
WhackAShill no I have not seen your spreadsheet only JimmyDaGeeks spreadsheet.
You said “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.” Since I qualify for a 2.9% HELOC can you tell what bank will give me a regular mortgage loan for less than that so I can take it out immediately.
Bonhoeffer said:
“Since I qualify for a 2.9% HELOC can you tell what bank will give me a regular mortgage loan for less than that so I can take it out immediately.”
First of all the 2.9% is a teaser rate: http://www.investopedia.com/terms/t/teaserrate.asp
Second of all, most people don’t qualify for this rate or other low rates that are advertised, that’s why I said “generally.”
Please get back to UFF as this is what the board is about.
I have yet to see a scenario where UFF beats do-it-yourself. My simple spreadsheet shows how you can beat UFF without floating your salary. A slightly more complicated method of doing it yourself could create slightly more savings if it incorporated the salary float.
Even when UFF takes advantage of the salary float it does not beat out the simple method of doing it yourself. UFF just cant overcome its high cost. Remember your not just losing 3500/3800. Your losing the potential to pay down your mortgage with that money. As Jennifer showed her calculation in your scenario, $7489 is wasted by using UFF.
WhackAShill your post with spreadsheet just showed up. I will look at it later. I have to leave for some time now. I will get to this later today. Thank you.
Bonhoeffer
718.32 is your discretionary income, 4503.32 is your take home pay, 5221.64 is the sum of both. Why these numbers? Since MMA talks about interest cancellation, I use your monthly salary as the initial HELOC draw. You can make that any number you want because your HELOC rate is below your mortgage and you save NOW no matter how much you withdraw. The most efficient use of the HELOC is to make a single draw and pay the interest.
You misread the spreadsheet. It only takes 134 months and 62,989 in interest to pay down your loan by yourself. If you make a HELOC draw equal to your take home pay and pay it against the mortgage, and just pay interest on the loan, it takes 133 months and you pay 61,786 in interest, assuming the 4% HELOC rate holds. Oh, and if you can manage full interest cancellation on your HELOC draw, it takes 132 months and costs 59,172 in interest. None of these numbers use your 4,400 savings.
BTW, you can use any Internet mortgage calculator and it will give you the same do-it-yourself number I did.
In short, we are not talking about a large difference in savings. Unless you want MMA’s “flexibility” and “what-if” features, etc. it’s not worth the extra $3500.
PS. Anyone using the spreadsheet, please don’t touch anything other than the yellow cells. Google does not seem to have a way to protect the worksheet, so anything you change, becomes permanent.
JimmyDaGeek this is very helpful information. You say “Unless you want MMA’s “flexibility” and “what-if” features, etc. it’s not worth the extra $3500.” I think people will have to make that decision for themselves and this seems like a fair and objective statement. From what I now have learned I think I will not need the flexibility and what-if features but I think I will keep my money in savings for these factors. As I see it I can also use the interest paid to HELOC as a tax deduction so I will get the HELOC but not use the UFF system. If my 2.99% HELOC goes over the interest of my first mortgage after 6 months I will stop using the HELOC.
But if someone else wants the flexibility and what-if features and wants to pay the extra $3500 I will not criticize them. Many people make purchases for things many other people do not need to purchases because of their expertise or knowledge. I will be happy for them that they can get out of mortgage debt even if this is the way it will work for them but not for me. I am thankful every day that I live now in a free country and we can make our own decisions. I am sure this will end my comments. Thank you for listening to me.
Bonhoeffer said:
“But if someone else wants the flexibility and what-if features and wants to pay the extra $3500 I will not criticize them.”
The problem is that the people who do buy the software believe it is doing something different then it actually is. The way that UFF markets the product makes it sound like the HELOC shuffle is saving tens of thousands of dollars when actually its the persons own discretionary income paying down the mortgage early – this is something anyone can do for free. This deception draws people towards the product and they don’t realize they can do it easily on their own.
This is why it is a scam, UFF sells the software under false pretenses.
I have yet to hear a UFF user say they bought the program for the what-if-features or “flexibility.” All that I have heard is: “wouldn’t you pay $3500 to save $100,000?” This is a classic and common example of the confusion that UFF creates.
Will one of you plug in these numbers into your spreadsheet.
$190,000 @ 8.25% for 30 years,
$35000 @ 12% for 30 years,
$60,000 @ 9% for 7 years,
$40,000 @ 10% for 5 years,
36,000 @ 10% for 5 years,
14,000 @ 10% for 5 years,
$500 discretionary income
No Heloc
Anonymous, must know your minimum payments for all the debts and your monthly income. Also how many more years/months on your 30 year fixed?
Will one of you plug in these numbers into your spreadsheet.
$190,000 @ 8.25% for 30 years, 336 mths remaining, 1427.41
$35000 @ 12% for 30 years, payment $360.01, 336 mths remaining
$60,000 @ 9% for 7 years, $965.34 84 mths remaining
$40,000 @ 10% for 5 years, $849.88, 60 mths
36,000 @ 20% for 5 years, 1095.49 44 mths remaining
16,000 @ 17% for 5 years, $397.64 payment, 48 mths remaining
$500 discretionary income
No Heloc
link
91 months or 7.58 years
Whackashill,
I think the last two creditors are starting off with the wrong balance or am I not reading this right?
Thank you for doing this.
I don’t think so, I took your loans and put them through an amortization schedule and that what it came to. Because you are several months into the loan I started with the balance that the schedule showed.
Ok…that sound right. Thank you so much.
You guys make my head hurt!
Who CARES whether you can do it yourself? Of course you can do it yourself. Of course… can you do it in the same amount of TIME? Are you going to be disciplined enough to stick with it? Are you going to be accurate with your math calculations?
If you can answer YES to all those questions…. guess what… you CAN do it yourself.
But if you are super disciplined about your finances… why are you even on this site looking at ways to get debt free faster? If you were that disciplined, wouldn’t you be out of debt already?
Only about 4% of people consistently stick to a plan to pre-pay on their mortgage. I read in an article that only about 10% of clients who visit a financial planner stick to the plan they paid them to come up with for them.
Yet 95% of UFIRST clients are logging in monthly to use their software. They are sticking with the plan. You guys make fun of that… but that is a huge amount of people that are being helped by this “motivational tool.”
One of our Agents has a GREAT analogy. Have you ever been on a diet? Did you find it hard to stick to the diet? What if you had a MAGIC FORK? What if you had a fork that, every time you took a bite, told you whether that bite would make you gain weight, whether you would still lose weight, or whether you would just stay the same. Would it be easier to stick to that diet?
Ever wonder why they put heart rate monitors, mile counters, and calorie counters on a treadmill? Ever used one that had them? Did it motivate you to walk that extra mile? To compete with your last result?
And how about the math? Sure you could do this yourself. But with a new, 30 year mortgage, if you “shorted” what you COULD have prepaid to your mortgage, in the first 5-10 years, by even just $1000 in total (maybe you are being conservative, maybe you make a math error), then you have just COST yourself over $4000 in savings that you missed getting.
Accuracy counts too.
Lastly …how valuable is your TIME? Obviously for Calvin, Craig, Jimmy, and WhackAShill (love the name), their time is not very valuable to them… hence the tremendous time they put in here. They must have have nothing better to do.
Is that you?
While a DIY approach, compared to an Analysis using just a “snapshot” of someone’s finances, is going to come out very close. That is just a “quick and dirty” comparison. What happens month to month, year to year as that person has variations in their budget, their cash flow, unexpected expenses, etc?
The DIY approach is going to require hours, rather than minutes, to do the math to adapt to the changes. This is probably why so many folks who try to do it themselves end up quitting 6 months or so into it.
All in all…. the motivational aspect… the financial planning tools… the accuracy of the math… all of them contribute to the 15% to 25% BETTER RESULTS that the average United First client gets, over what their initial Analysis shows them.
Bottom line….
This is totally worth it for some folks.
Others… not so much.
But no one should be ridiculed for seeking out a better approach. Look where you are in your life. Where do you want to be? How has what you have been doing in the past worked out for you so far?
Satisfied? Keep doing what you are doing.
Not satisfied? Einstein said…. “Insanity is doing the same thing over and over again and expecting a different result.”
Sue,
I decided UFF was not for me and I thought I would not write something else on here, but you made me think of this. WhackAShill said he could not get good HELOC rate because he did not have good LTV (only 95%) with his mortgage. I’m sure he will have an answer to this as he does for everything, but I would say you are right. If he is so good with finances why does he have such high LTV on his mortgage. I will not criticize anyone who uses UFF to pay off their mortgage if that is what makes them do it. More people must start to owe less in this country or we are headed for economic problems. Freedom is good and people can do what they think is good for them. Synnyster sent me link from Dave Ramsey and said don’t you know who Dave Ramsey is. Yes I know who Dave Ramsey is and what he teaches. One thing he teaches is to be completely free from debt. Then if you follow Dave Ramsey teaching and use his link to make a point why does WhackAShill not follow his advice to be out of debt but instead have such a high LTV on his mortgage. Sue your questions are good even though I will not need the UFF.
Wow Bonhoeffer… I didn’t even notice that. I wasn’t aiming at WhackAShill. In fact, unlike some folks who think those guys are “selling” something else (are they?)…. I thought most of them were, for the most part, well meaning. The “die hard nay-sayers” are obviously smart… and it sounds like they are good with math too.
The thing is… when someone is “smarter than the average bear” it is easy for them to forget that not everyone has the same skill sets they do. For example, I certainly understand the math of this program and I know that, if I chose to, I could do it myself.
However, despite knowing HOW to do it, I am the worst procrastinator in the world and my least favorite thing to do is… guess what?
Also… after running my Analysis, I calculated that in order to justify NOT getting the software, I would have to be confident that my math skills would land me within a 3.8% margin of error. And that was just calculating the margin based on the savings from my current house.
So I factored in that I am NOT disciplined. I would rather spend my free time fishing, flying or riding my motorcycle, and that I am planning on buying at least 2 other homes, possibly 3, and I figured that not getting it would be “penny wise and pound foolish.”
I have had 4 clients (really 5, but one came back), who I advised to just do it themselves. They were in the last house they were going to own, we were still on our old Version 3 software, and they all had less than 6 years left on their mortgage. They also had no other debt. So for them I just gave them instructions on how to do this and gave them an Analysis that they could track their results with a little bit. The guy that came back decided to buy an investment property… so then it made sense for him.
Now though, with our new Version 4 software (totally different algorithms), this program has become more of a “wealth building” tool. So if those 4 clients were in front of me now… I’d advise all but one couple (in their 70′s), to get it. Because once you are debt free, you can use the current Version to just invest more efficiently and better stay on track with your financial plan.
In fact I learned what the next couple of generations of this software is going to do when I was at a luncheon last week. It is “inside info” so I can’t post it here, but trust me when I say that, once those versions come out, even the die-hard nay-sayers are going to be hard pressed to come up with any credible “negatives.”
Also… for the guy who wondered why we didn’t have any “major media” reviewing our program yet… it is no mystery, and anyone who has ever launched a new company will understand why. We were waiting for the right time. The old version of the software was a temporary version. The founders wanted to launch the Version we launched a few months ago originally… but the technology was not avail 8 years ago when they started to work on this, so they had to launch a more simple system (one of the reasons they give past clients the new upgrade for free). Also… you never want to invite the real experts in before you have everything working smoothly (not just the product, but the operations side), have a good strong history of results to show, etc. It is my understanding that we are in the process now of inviting more credible experts to come in and take a look. This is time consuming of course, as you want to put your best foot forward and make sure it is done right. You have to make sure they are really going to “test drive” the software… use it for an extended period of time, interview clients, etc. Otherwise you are in danger of what is already happening with the self-proclaimed experts who simply take a superficial look and think that is enough.
As for you doing it yourself…. good for you… go for it! Worst thing that happens is 6 months or a year down the road you decide to take the “easy way out.” If you do… call me up! Oh… but if you haven’t had someone do an Analysis for you yet… do that now… so you have something to compare to. That way, if you do a great job, you know it for sure. If not, you can catch it before it gets too far off track.
Sue,
The problem is that the people who do buy the software believe it is doing something different then it actually is. The way that UFF markets the product makes it sound like the HELOC shuffle is saving tens of thousands of dollars when actually its the persons own discretionary income paying down the mortgage early – this is something anyone can do for free. This deception draws people towards the product and they don’t realize they can do it easily on their own.
This is why it is a scam, UFF sells the software under false pretenses.
I have yet to hear a UFF user say they bought the program for the what-if-features or “flexibility.” All that I have heard is: “wouldn’t you pay $3500 to save $100,000?” This is a classic and common example of the confusion that UFF creates.
Bonhoeffer,
I carry a high balance on my mortgage because I can get a higher return on my money then my my interest rate. If you take a basic investment class you would understand the benefits of not paying off your mortgage early.
Sue,
You keep lying about the fact that paying down your mortgage or debt does not involve any spreadsheet or even a calculator, just paper and pencil and an amortization schedule. It doesn’t take hours to prepare, just minutes. All that the fancy spreadsheets do is show people that numbers don’t lie, just UFF agents.
If you have debts, use the snowball method as explained by David Ramsey – no credit line needed. If you have just a mortgage, simply apply your discretionary income. If your expenses exceed your income one month, borrow from your HELOC, then pay it off immediately. That’s all you have to know. There is no calculation or accuracy needed except to figure out how much discretionary income you have.
For some reason, people want to be told that they are too stupid to follow simple instructions and simple methods. They want to believe the UFF rocket scientist story and that magic algorithms will find money for them. MMA users are financially undisciplined, mathematically illiterate and intellectually lazy. If they spent some time understanding their own finances and what they are doing, they would understand that the amount of money people lose not using the optimal MMA way can be measured in $100s of dollars, not the $1,000s that MMA costs them in the long run.
Becoming debt-free is a personal choice. Except for mortgages in the US, every other consumer debt should be paid off because you gain nothing otherwise. I choose not to pay down my mortgage because I choose to invest my money for the long term and take advantage of the mortgage tax break. The time I put in here is not tremendous because I keep saying the same things over & over again. If I can reach one person who is searching for truth to help them make a decision, I am happy. The sycophants who post here keep challenging the DIY methods, but are never able to beat them.
And, as I have posted over and over, if someone chooses to spend their hard-earned money on MMA even after they’ve read everything, that’s their business. I just want to make sure they have everything they need to read to make an informed choice, not a scared one.
I wonder why Sue would want to make paying down your mortgage early sound difficult?
I wonder why Sue admits that she is bad with math and finances and yet advises others how to take control of their finances?
I wonder why Sue says it takes less time to use UFF then do-it-yourself when it takes less than 5 minutes a month to do it yourself?
I wonder why Sue ignored the fact that the only major media on UFF is Kiplingers negative review?
I wonder if Sue knows that anyone can replicate the “discipline” with Microsoft Money or Quicken at 2% of the cost?
I wonder if Sue knows that the only people that buy the UFF software are people that were lied to?
I wonder if Sue knows that the 95% of people that log onto the UFF software would be complete idiots not to use something they paid $3500 for.
I wonder if Sue knows if the other 5% are trying to get their money back but are finding it difficult because the money back guarantee is a lie.
I wonder why anyone would pay $3500/$3800 for something they could do quicker and easier for free?
I wonder if Sue knows that she is in a pyramid scheme?
I wonder if Sue knows how long it will take the US government to step in and stop this scam similar to how the Australian government did?
Sue I wonder how long you will sell this scam software before your conscience catches up to you?
WhackAShill you say “I carry a high balance on my mortgage because I can get a higher return on my money then my my interest rate. If you take a basic investment class you would understand the benefits of not paying off your mortgage early.”
I wonder if WhackAShill knows that his double speak is catching up with him. If this is what you believe why do you spend so much time telling people how they can pay off their mortgage early with do-it-yourself instead of telling them how to invest their money and not pay off mortgage? Why did you not mention this to me in all of our discussions? I wonder if Dave Ramsey has taken basic investment class since he says pay off mortgage early and get completely out of debt as soon as possible. The fact is financial experts have different opinions about this.
When you said you had 95% LTV it was to show you could not get good HELOC. Now it is because you don’t want to pay off mortgage early. WhackaShill you have not logic and you make no sense.
Bonhoeffer,
As with many others, this whole thread has been from the assumption that a person is looking to put their next discretionary dollar towards mortgage (or other debt) reduction. No one has been saying anyone SHOULD pay down their mortgage debt. Just IF you want to pay it down, is “UFF’s MMA a scam or legit?” as the thread title states.
-L2G
Bonhoeffer is again straying from the subject,
Bonhoeffer would rather focus on myself then the UFF product because there is no longer a logical argument to promote this scam.
I understand that some people would rather pay off their mortgage than invest. This is a personal choice and I agree investing is not for everyone. Having said that, if someone decides that paying off their mortgage is first priority, UFF has proven to be a terrible way to do it.
The problem with UFF that Sue and Bonhoeffer can’t seem to refute:
People who do buy the software believe it is doing something different then it actually is. The way that UFF markets the product makes it sound like the HELOC shuffle is saving tens of thousands of dollars when actually its the persons own discretionary income paying down the mortgage early – this is something anyone can do for free. This deception draws people towards the product and they don’t realize they can do it easily on their own.
This is why it is a scam, UFF sells the software under false pretenses.
I have yet to hear a UFF user say they bought the program for the what-if-features or “flexibility.” All that I have heard is: “wouldn’t you pay $3500 to save $100,000?” This is a classic and common example of the confusion that UFF creates.
I used the MMA program to pay off our mortgage. When my husband’s and my analysis was run we were told that we would be able to pay off our then 10.5 year mortgage in 3.7 years and save over $22,000 in future mortgage interest. We decided to sign up.
Six months later my mother passed away. Using a small inheritance from her estate we finished paying off our first mortgage. It took a few months to finish paying off the HELOC, but in one year’s time, we had both the 1st mortgage and the HELOC paid in full.
It is true that we couldn’t have paid off our mortgage in one year without my mother’s inheritance, but I would contend that we couldn’t have paid it off without the MMA program either. Using the program changed our entire way of thinking. We learned the real value in paying off debt, all debt, even debt that has its tax advantages. I’d rather never pay a dollar in the first place than get a portion of that dollar back in a tax return because I did pay the dollar.
My husband and I are very disciplined people. We paid extra principal every month towards our mortgage before signing up for the MMA program. We paid what we considered to be our discretionary income, but it was only chipping away at our mortgage. With the MMA program, we were able to get more leverage by using the bank’s money to help pay down our mortgage. The software told us the optimal time and amount to transfer to our first mortgage. I’m pretty smart, but I could not have figured out optimal timing and amounts on my own.
We gleaned as little as anyone I know from using the MMA account. We only had mortgage debt, and we only had 10.5 years left to pay. Some people have several debts and many years left to pay on their mortgage. These are the people who truly stand to benefit from using this program. Still, with as little as we had to gain, the $3500 was a small price to pay. If we had only done as well as our original anlysis suggested — paying off our mortgage in 3.7 years and saving over $22,000 in future mortgage interest, we would have received a return on our investment of over 500%. That’s a pretty good return on investment! And as for getting the same or better results by just applying more money on our own to principal, the best case scenario that I could come up with, at the time, was paying off our mortgage in 5 years, and that was if we bit the bullet and really scrimped and saved to do it. It was well worth $3500 to get a software program that would give us the know-how to pay off our mortgage in 3.7 years without asking us to change our lifestyle.
I am thrilled with the MMA program. I just recently became an independent agent for United First Financial, so I have a vested interest in the program, but I did not begin selling it until after I had paid off our own mortgage using the program and had seen first-hand how easy it is to use and how well it really works.
You could pay off your mortgage on your own using the “one account” concept without using the MMA software, but I doubt that you or anyone else, even the smartest mathematician or financial guru, would get the same positive results as you would get if you paid off your mortgage using the software, and I am almost certain you could never do as well in getting out of debt if you had more that just your mortgage debt to pay. And most people do have more than just mortgage debt. UFF’s MMA guides a person when and how to pay off all their debt and do it in just a fraction of the time it would normally take. Is this worth $3500? Absolutely!
Tina Shaw Said:
“With the MMA program, we were able to get more leverage by using the bank’s money to help pay down our mortgage. The software told us the optimal time and amount to transfer to our first mortgage. I’m pretty smart, but I could not have figured out optimal timing and amounts on my own.”
Tina this “leveraging” only saves a couple bucks a month. This money is hardly worth the time or extra effort that UFF requires, not to mention this money never adds up to $3500/$3800.
Through deceptive marketing, people that buy the software believe that the “leveraging” is actually savings tens of thousands of dollars.
Tina Shaw said:
“Some people have several debts and many years left to pay on their mortgage. These are the people who truly stand to benefit from using this program. Still, with as little as we had to gain, the $3500 was a small price to pay. If we had only done as well as our original anlysis suggested — paying off our mortgage in 3.7 years and saving over $22,000 in future mortgage interest, we would have received a return on our investment of over 500%. That’s a pretty good return on investment!”
Classic misrepresentation of the facts. Your return on investment is actually a loss. You could have done better without the software using less time and effort. Mathematically UFF is a loser, it takes more time and more effort to achieve a worse result then doing it yourself.
Saying that your return on investment is 500% is like saying you went to a casino with $50, lost the $50, went to an ATM and took out $500, lost $250 and leave the casino with $250. $250 is 500% more than $50 that you came in with so I guess the return is 500%?? What a joke.
Tina Shaw said:
“I am thrilled with the MMA program. I just recently became an independent agent for United First Financial, so I have a vested interest in the program”
I wonder why you would say you are happy with the program? Could it be the fat commission checks your looking to collect? Perhaps you feel ripped off and your looking to get some of that wasted $3500 back?
Tina Shaw said:
“You could pay off your mortgage on your own using the “one account” concept without using the MMA software, but I doubt that you or anyone else, even the smartest mathematician or financial guru, would get the same positive results as you would get if you paid off your mortgage using the software, and I am almost certain you could never do as well in getting out of debt if you had more that just your mortgage debt to pay. And most people do have more than just mortgage debt.”
In every mathematical scenario presented on dozens of web sites UFF has come behind doing it yourself and takes more time then doing it yourself.
I wonder why you would want to make paying off your mortgage sound hard?
I currently have a client who has 25 years left on his mortgage loan on which he still owes $150,000, and he has about $110,000 in other debt, including a $74,000 2nd mortgage on his house. The analysis I ran for him shows that using the program he will be able to pay off all his debts in just 12.9 years with just $50 per month in discretionary income. This is nothing short of a miracle for him and his wife! I don’t know of anyone who can come up with this kind of result on his/her own.
I’m amazed that people could be so bitter toward a program that is helping people so much. I feel no need to recoup any money I paid for this program. The need I feel is to spread the good word about it so that others can prosper from it as much as I did.
Tina said:
“I currently have a client who has 25 years left on his mortgage loan on which he still owes $150,000, and he has about $110,000 in other debt, including a $74,000 2nd mortgage on his house. The analysis I ran for him shows that using the program he will be able to pay off all his debts in just 12.9 years with just $50 per month in discretionary income. This is nothing short of a miracle for him and his wife! I don’t know of anyone who can come up with this kind of result on his/her own.”
Have you read nothing on this board? beating UFF is easy, just pay off the highest interest debt first, once that debt is paid off you have more discretionary income because the payment that was going toward that debt can be used for the next highest interest debt and so on.
If you scan this persons analysis and post it I can easily show you how UFF is costing this “client” more money then simply doing it themselves.
James Barnes posted his “unbeatable” UFF challenge and after he was shown how easily beatable UFF is he left the board with his tail between his legs.
Tina,
If you click my name highlighted in blue you can see an example of where a person had a 190,000 mortgage, 187,000 in additional debt, and only $500 in discretionary income, paid off his mortgage and all debt in 7.5 years by doing it himself, with no software.
There is way more to the Version 4 software than paying down the debt with the highest interest rate first and then going to the second, and so on. Just because a debt has the highest interest rate, doesn’t necessary mean that it should be the first to be paid off. The math used in Version 4 determines what should go first, and people using the software are directed where to transfer money and when.
Tina please explain when it is better off to pay a lower interest debt before a higher interest debt. I can’t wait for this answer.
Tina said:
“There is way more to the Version 4 software than paying down the debt with the highest interest rate first and then going to the second, and so on. Just because a debt has the highest interest rate, doesn’t necessary mean that it should be the first to be paid off. The math used in Version 4 determines what should go first, and people using the software are directed where to transfer money and when.”
This might be true, but this does not mean UFF is more efficient then doing it yourself.
You see there might be a million ways to pay off your debt, but only one makes sense if your trying to do it quickly, and UFF is not the most efficient way because it gets you more in debt.
Not only do you lose $3500/$3800, you lose the opportunity to pay down your mortgage/debt with that money, costing you more interest over time.
Too much negativity here for me. No wonder James left.
I know the program works and that there are a lot of happy people and a lot less debt in this nation as a result. I decided to add to the blog just because I had a personal story to tell. But I could argue with you for days on end and it wouldn’t accomplish anything. You’d still believe that people are better off paying down their debt by themselves.
I’m glad I invested in the software and know of thousands of other people who are equally pleased. I’ll leave this conversation at that, for now.
Happy blogging!
James left because he was proven wrong with math,
Tina cant even back up her statements:
“Just because a debt has the highest interest rate, doesn’t necessary mean that it should be the first to be paid off”
This is the logic that UFF agents promote.
“I know the program works and that there are a lot of happy people”
Does the program work the way you think it does?
Do you refute math that proves that the software is mathematically inferior to a free system that is quicker and easier?
I wonder how happy these people would be if they realized how easy it was to do more quickly on their own?
I wonder how many of these people were told how hard it was to do on their own?
I wonder why agents like Tina claim people don’t have time to do it on their own, even though it takes less time to do it on their own?
I wonder if these people know that although there are millions of ways to pay off debt, there is only one way to do it quickly, and its easy to figure out?