When you move into a new home, you are inundated with mail. You get notifications and bills for all the utilities you’ve signed up for, mail from your old home forwarded to the new (if you’re lucky), a notification a week in that your mortgage has been sold (hah! why didn’t ya just get me from the beginning, Wells Fargo?), and some mail from con artists. In my case it was the so called Loan Payment Administration of Xenia, OH, a business you’ll be hard-pressed to find online. I almost called their phone number just to see how they pitch it, but I didn’t my number going into some callback database.
The letter you get looks nice and official, with one Sandra Lipsky offering to reduce the overall length of my mortgage by offering as a middle-(wo)man collecting my mortgage payment bi-weekly instead of monthly. All they do is hold onto your money until your mortgage payment is due and then submit it for you, but since you’re paying them a total of 26 payments a year (as opposed to 12 monthly payments), they’re ostensibly putting that “13th” month’s payment toward the principal of your loan. To build your confidence, the letter claims to represent a service featured in CNN Money, the Wall Street Journal, etc. Great, because that’s all it takes to make my pull out my wallet!
I closed my last post drifting terribly close to a tangent regarding confidence games, when on my desk was sitting a prime example. The “con” in con artist just means someone is trying to gain your “con”-fidence so you pad their bank account on some pretense of a deal. This company may in fact put extra money toward the principal of your mortgage, but the big question is… why don’t you just do that yourself? Who is really being helped here? If you know enough to setup automatic or even manual payments to this third party service, can’t you just do it for the bank servicing your loan? Every web application I’ve used to pay my mortgage allowed me to pay extra toward the principal of the loan any time I wanted to, so I’m sure you can, too.
In reality, we have no clue what they do with your money once they take it. I’m sure they’re earning interest on it somehow or collecting a fee (50% of that 13th month? 75%?), but as I said, I’m not letting my number go into their database. If you’re brave and want to share the details, feel free to call 1-800-317-1756. I can confidently assure you they’ll ask for No Upfront Fee (their bolded words, not mine), but who knows?
On a side note, I’m interested to know what you’d call a person who’s an expert at confidence games, or perhaps someone who advocates for con artists? A pro con artist? Perhaps “pro” is short for something there?
If you ever register a domain name, expect to get the same kind of mailings. There’s always some crazy company trolling the latest registrations eager to mail you what appears to be an invoice for the servicing of your new domain. They’ll offer SEO services and maybe some other sort of domain assurance, but it’s all a sham. Their bit always looks like an invoice that reads “This is not an invoice.” (which is theoretically illegal even with the disclaimer) to gain your confidence. The Loan Payment Administration just tries very hard to look exactly like the paperwork I get from my bank.