Personal Finance

United First Financial (Scam Warning)

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  • May 24th, 2011 7:51 pm
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes

United First Financial (Scam Warning)

I was asked about this company by a friend in the U.S. They are a mortgage acceleration company. Further, they sell their software product (actually - web app access) through independent agents - most of whom are clients who purchase the option to become "agents" for a nominal fee. Most of these people are not financially savvy, or they wouldn't have become clients in the first place. Here's why:

United First Financial (UFF) espouses the Money Merge Account (MMA) strategy to pay off your mortgage. This involves the homeowner to take out a Home Equity Line of Credit (HELOC - or ALOC) against the equity they do have in the home. The first $3500 USD goes to UFF. No joke. Their fee is $3500, and paid right from this line of credit. The selling agent shares in a $2500 commission with those "up-stream". Again, $2500 commission on a $3500 product.

The homeowner then rolls all chequing and savings account money into the HELOC. Cheques are deposited to, and written from, the HELOC.

The homeowner inputs all the relevant information into the software regarding the mortgage, plus household income and expenses. By logging in once per month, the homeowner is told by "algorythms" how to move money between the HELOC and the 1st mortgage, in such a way as the mortgage can be paid off "in less than half the time", "with little to no change to their day-to-day spending habits and without increasing their minimum required monthly mortgage payments".

Anyone with half a brain should be able to see through statements like that.

These people are now focusing on growth on Canada. If you see anyone promoting this, or worse, if a friend or family member has already been sucked in, there is good information on the web about why this is a scam:

Google search:
http://www.google.com/search?source=ig& ... gle+Search

Excellent thread in a US deals site:
http://www.fatwallet.com/forums/finance/741118

Another good discussion:
http://www.friendsinbusiness.com/board1 ... ead/122068

An open challenge to UFF agents, as yet unanswered:
http://www.friendsinbusiness.com/board1 ... ead/129143

I'll leave the mathematical proofs for later. Everywhere a scam warning has been issued, UFF agents or "people who know somebody using an MMA" arrive quickly, defending the product. We can get into the math then, but here's a common challenge they've yet to answer:

[QUOTE]$5000 income per month (paid $2500 on the 15th, $2500 on the 30th).
$1500 per month bills, due on the 25th.
$200k mortgage, 6%, 30 years, $1199.10, due on the 1st of each month. 7.5% heloc
$5000 in the bank, 3% interest.

Show me the movements that payoff the mortgage and HELOC ASAP with MMA, I'll payoff the mortgage ASAP. If you are right, you'll pay it off first. If I am, I'll pay it off first.[/QUOTE]
902 replies
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes
I am seriously disappointed. I had hoped a UFF agent would want to prove me wrong on Canada's premier deals forum. UFF is supposed to be a deal.

There are great conversations going on at US deal site Fatwallet.com, as we try to walk a UFF client through the process of getting his money back. With new Canadian agents, I was hoping one would show up here in defense of UFF. Until that happens, I'll just wait.
Newbie
Aug 13, 2005
89 posts
16 upvotes
Ottawa
Nice post, BartBandy. I recently heard about this MMA plan as well, and am very interested to hear rebuttals.

So, a free bump for your thread to see if anyone out there can answer...
Deal Addict
User avatar
Oct 25, 2001
3289 posts
1606 upvotes
Toronto
I must be missing something with the hypothetical scenario included in the 1st post because it is obvious whether it is MMA or Manulife's M1 or Canadian Tire's All in One that they can show you that this mortgage could be paid off in about 5.5 years whereas the current mortgage payments wouldn't even pay it off in 30 years.

The wrinkle is that the HELOC is at a rate 1.5% higher than the mortgage. But, that will be insignificant compared to channeling the additional $2,300 to the mortgage every month.

Why $2,300? Take your total income of $5,000 and subtract your bills of $1,500. That leaves $3,500 to be applied to the mortgage each and every month, not $1,199.10.

Plus, of course, you would start by putting that $5,000 earning 3% interest against your mortgage from day 1.

Now, is it realistic to assume that this is how it will really play out? There have been arguments for/against that idea in many forums.
Newbie
Jul 26, 2008
1 posts
Did UFF operate under a different company name about 2 years ago? I was approached by a company back then but can't remember the name....
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes
Darin08,

The principles of UFF used to operate a different mortgage acceleration company called "Accelerated Equity". I'm not aware of the specifics.


cannon_fodder,

Yes, the MMA uses all extra income and funnels it to the mortgage, but instead of applying it directly, even more money is sent to the mortgage earlier by borrowing from the HELOC, then the income pays down the HELOC. Depending on the timing of pays and expenses, you can save a few pennies, but nothing close to what UFF claims. The real savings are achieved by the simple prepayments, and those are easier to do yourself. Not to mention, the $3500 fee is much better spent on the mortgage.

The actual argument used by some agents in favour of their $3500 fee, is that you are paying it (and your mortgage) with "other peoples money". "OPM" for short. They seem to forget the money is borrowed from the HELOC and the homeowner is on the hook for it.


We'll see if any UFF agent wants to discuss this further. This thread is high in the google.ca search rankings for "United First Financial", so it must be on their radar. It's not so high for "Money Merge Account", but I can't change the thread title now.
Deal Expert
May 17, 2008
15134 posts
160 upvotes
How does this whole thing work? Who do you actually borrow the money from? This seems very similar to the Manulife and Canadian Tire all in one accounts, except in those accounts seems much more straight forward.

These types of schemes seem to make sense in some ways, but the main drawback of the manulife and canadian tire accounts is that they have higher interest rates then conventional mortgages, which can offset the savings from the scheme.

This 3500 dollar payment just to start using this UFF system seems sketchy to me. I guess if it allows you to use the same scheme as the canadian tire accounts but also shop around for better interest rates, it could be a good idea, but it starts you off with a setback of 3500 dollars.
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes
BornRuff wrote: How does this whole thing work? Who do you actually borrow the money from?
You set up a HELOC against the existing equity in your home. Then you use the HELOC as your chequing account. Every 2-6 months, the MMA software will direct you to transfer a lump sum to the mortgage from the HELOC.

Remember, the HELOC usually carries a higher rate of interest than the mortgage. HELOCs are charged interest based on the average daily balance over the month.

There are some advantages available from timing your paycheques and expenses so that you aren't paying the HELOC interest on a large balance over the entire month, but the savings are small.

And you're right - any savings are wiped out by the $3500 fee, plus interest on it, for the life of the mortgage.
Deal Expert
May 17, 2008
15134 posts
160 upvotes
BartBandy wrote: You set up a HELOC against the existing equity in your home. Then you use the HELOC as your chequing account. Every 2-6 months, the MMA software will direct you to transfer a lump sum to the mortgage from the HELOC.

Remember, the HELOC usually carries a higher rate of interest than the mortgage. HELOCs are charged interest based on the average daily balance over the month.

There are some advantages available from timing your paycheques and expenses so that you aren't paying the HELOC interest on a large balance over the entire month, but the savings are small.

And you're right - any savings are wiped out by the $3500 fee, plus interest on it, for the life of the mortgage.
So the product doesn't specify where you get the HELOC from? If you are not borrowing any money from UFF, then I guess the 3500 dollar fee doesn't seem all that crazy. Manulife and Canadian tire make much more than that on their versions of this. While the whole scheme is questionable, this might just be a better way to take advantage of it than the manulife or canadian tire plans because you can probably get better interest rates with this plan.

So do you deposit your entire paycheck into the mortgage every month and then live off the HELOC?
Deal Fanatic
User avatar
Aug 19, 2001
5171 posts
116 upvotes
Vancouver
someone attempted to recruit me for this. I actually listened to about 20 minutes of a 30 minute conference call while they tried to explain what this was about.

As others have found the claims are big but the explanations are sparse. It all seems to come back to this magic software.

Certainly seems like a scam to me. But so are the Manulife account etc. which sucker people into taking a HELOC at prime instead of saving 1% on a variable rate mortgage.
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes
BornRuff wrote: So the product doesn't specify where you get the HELOC from? If you are not borrowing any money from UFF, then I guess the 3500 dollar fee doesn't seem all that crazy. Manulife and Canadian tire make much more than that on their versions of this. While the whole scheme is questionable, this might just be a better way to take advantage of it than the manulife or canadian tire plans because you can probably get better interest rates with this plan.

So do you deposit your entire paycheck into the mortgage every month and then live off the HELOC?
You deposit your pay into the HELOC.

The Manulife One account and other offerings are also bad deals. What makes the MMA a scam is how it's marketed. Plus, the MMA is slower than simply using the same money to prepay your mortgage yourself.
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes
If anyone wants a chuckle, the loooong blog comments at The Simple Dollar now have a very good outing of UFF agent Dave Moore, who started off claiming to be a "university professor", and using his "mega-analysis", he was trying to argue from the point of view of someone who used the MMA.

Not surprisingly, he's also an agent. He also sells .ws domains as part of Global Domains International. In an interesting twist, he's also a nudist with a website on that as well. It's on a .ws address, of course.

Dave has since removed his name from his UFF website, but he forgot how telling the url is:

http://www.u1stfinancial.net/davemoore

Here's his Global Domains International affiliate link:
davemoore.ws/
http://www.website.ws/dvdmr

Sorry, I'm not going to link to the nudist site. lol

Dave has since said UFF agent Dave Moore is not the same Dave Moore. Of course, the UFF agent removed his name from his own site within a day of the outing, so draw your own conclusions. From the name, to the action, to the association with another home-based get-rich-quick scheme (GDI), this is the same guy.

At least Dave posted under his own name. Sue Copening, a UFF agent from Florida, has been posting pro-UFF comments all over the web as "Bob Trout".

No doubt, she has done some "mega-analysis" as well.

Just a few more examples of why UFF agents are clueless, aren't qualified to work a cash register, and should not be allowed anywhere near your mortgage.
Newbie
Aug 22, 2008
3 posts
BartBandy

Chuckle a little more. I just read through this thread. It is completely irrational. But I really think that's how Dave Moore intended it. The nudist site and the global domains international site are registered to two different people. To find this out all you have to do is register a domain name with .ws. That will get you access to the global domains international main office in Carlsbad, California. The price is $10 a month, but you can quit before 7 days and not be charged. In the thread Dave Moore stated he called the UFF client service and there are 4 agents with the name Dave Moore. He is technically wrong about this. I checked and there are actually 3 UFF agents named Dave Moore, but 5 registered as David Moore. He could be the one with the global domains international website, but not the one with the nudist site. Or he could be the one with the nudist site but not the global domains international site. If you go to u1stfinancial, ufirstfinanicial (and other variations) .net or .ws or .com, etc. you can come up with any number of usernames at the end. I won't list them here for obvious reason, but you can do this exercise and see for yourself. So the Dave Moore in the thread may be the nudist and he may not be. He may be the global domains international guy and he may not be but he can't be both. I found UFF agents either Dave or David Moore in California, Minnesota, Florida, and Delaware. He may be the u1stfinancial guy and he may not be. That's the best we can say about him except that what he wrote in that very long blog makes very little sense. He spent most of his time either trying to defend himself or trumpeting his intelligence instead of dealing with the facts of the issue being discussed. But so did everyone else. He also may be a university professor and he may not be. There are several people with his name who are. I really think who wrote this is not a Dave Moore at all, but just chose a common name like that to throw everyone off of his real identity. That's where the real chuckle is because he knew that no one else was using a real name. That thread is interesting if you read it carefully. I don't think he has any vested interest in anything but trying to be argumentative and making people give evidence for what they believe. He mentions evidence a lot. That's my take.
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes
About Face wrote: To find this out all you have to do is register a domain name with .ws. That will get you access to the global domains international main office in Carlsbad, California. The price is $10 a month, but you can quit before 7 days and not be charged.
Before anyone THINKS of doing this, Global Domains International is another pyramid scheme, and there are reports about them charging credit cards before the 7 day limit was up, because the 7th day would fall on a weekend.

GDI sells .ws domain names. They say ".ws" stands for "Web Site". Actually, it stands for "Western Samoa". So, unless you are actually from Western Samoa, the .ws extension just makes you look silly. Real companies don't have .ws websites.

If you want to see just how useless .ws domains are, just try a few popular site names with a .ws extension:

www.cnn.ws
www.sony.ws
www.microsoft.ws

They're all ads for GDI and/or GDI affiliates. It's as if almost all .ws domains are set up to sell .ws domains. It's an obvious pyramid.

Real companies buy up their .com, .net, .org, .info, .mobi, and .ca domains. They don't buy their .ws domain.

And if you do want a .ws domain, other registrars sell them cheaper than GDI at $10/month (hosting included). You can get the domain for $15/year and get better hosting for $5/month.

But this was about United First Financial - another MLM pyramid.
Newbie
Aug 22, 2008
3 posts
BartBandy, yes this thread is about UFF. It's not about GDI and it's not about some guy with a supposed nudist site who in turns out doesn't have one after all or maybe he does but he's not the same guy as some UFF agent as it was stated. I was trying to correct some misinformation what its worth not trying to get people to sign up with GDI so stick with the subject instead of acting like you are the all knowing.
Newbie
Aug 22, 2008
3 posts
BartBandy, yes this thread is about UFF. It's not about GDI and it's not about some guy with a supposed nudist site who in turns out doesn't have one after all or maybe he does but he's not the same guy as some UFF agent as it was stated. I was trying to correct some misinformation for what its worth not trying to get people to sign up with GDI so stick with the subject instead of acting like you are the all knowing.
Deal Addict
Sep 2, 2002
2120 posts
47 upvotes
OK, let's address what you wrote in that rambling paragraph...
About Face wrote: BartBandy

Chuckle a little more. I just read through this thread. It is completely irrational. But I really think that's how Dave Moore intended it. The nudist site and the global domains international site are registered to two different people.
I was going to make the connections myself, but I found a better post that does it for me:

http://www.fatwallet.com/forums/finance ... #m12638875


About Face wrote: To find this out all you have to do is register a domain name with .ws. That will get you access to the global domains international main office in Carlsbad, California. The price is $10 a month, but you can quit before 7 days and not be charged. In the thread Dave Moore stated he called the UFF client service and there are 4 agents with the name Dave Moore. He is technically wrong about this. I checked and there are actually 3 UFF agents named Dave Moore, but 5 registered as David Moore. He could be the one with the global domains international website, but not the one with the nudist site. Or he could be the one with the nudist site but not the global domains international site. If you go to u1stfinancial, ufirstfinanicial (and other variations) .net or .ws or .com, etc. you can come up with any number of usernames at the end. I won't list them here for obvious reason, but you can do this exercise and see for yourself. So the Dave Moore in the thread may be the nudist and he may not be. He may be the global domains international guy and he may not be but he can't be both. I found UFF agents either Dave or David Moore in California, Minnesota, Florida, and Delaware. He may be the u1stfinancial guy and he may not be. That's the best we can say about him except that what he wrote in that very long blog makes very little sense. He spent most of his time either trying to defend himself or trumpeting his intelligence instead of dealing with the facts of the issue being discussed. But so did everyone else. He also may be a university professor and he may not be. There are several people with his name who are. I really think who wrote this is not a Dave Moore at all, but just chose a common name like that to throw everyone off of his real identity. That's where the real chuckle is because he knew that no one else was using a real name. That thread is interesting if you read it carefully. I don't think he has any vested interest in anything but trying to be argumentative and making people give evidence for what they believe. He mentions evidence a lot. That's my take.
You blow smoke around like a UFF agent. And you seem very concerned about Dave's reputation. Of course, you didn't list Clever, MO or Springfield, MO as your location here. Arizona, eh? I wonder if the RFD admins would do a tracert on your IP for me?

I've used my real name (Craig Hansen) multiple times in connection with UFF-related posts. UFF can't sue me because truth is a perfect defense against defamation. Dave uses his name because he thought he might get clients from his comments.

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