My father always told me, “Don’t make the same mistake twice.”

If only our economy worked that way.

I saw a flyer today for a new mortgage company that scared the pants off me.  They’re offering the very same products that put the North American economy in it’s current predicament.  And now, I’m going to rip into them on this public forum…

Sure, they could probably sue me for writing what I’m about to write.  And perhaps in a couple of days after talking to the people that matter, I might be forced to remove this post from my website.

But for the time being, I’d like to examine this “new and exciting” company and the products that they offer.

First thing’s first: when you hear “241” or “two for one,” what do you think of?

How about….

…hmmm….

That’s it!  Living in Ontario the past decade, how can you NOT think of pizza when you hear “two for one, oh, two for one”?

So this mortgage company either named their business after a pizza chain, or after the greatest deal in the history of deals: TWO FOR ONE.

Two for one what?  Two for one mortgages?

Anyways…

Here is a copy of the flyer I received at my office this week:

(click to enlarge)

Within two days, somebody had posted this flyer up on the whiteboard in our office, and hand written the caption:

“Isn’t this how it all started?”

This mysterious writer is correct.

You’d think after the credit-crunch and sub-prime-mortgage crisis in the United States in the last 18 months that perhaps we’d learn from the mistakes of our Yankee cousins and that lending institutions would become more guarded and perhaps weary of whom they lend money to.

But not 241 Financing Inc!

No way, no how!  It’s their job, their right, their honor to approve mortgages for those who can’t get it anywhere else!

I’m not sure which part of this advertisement scares me the most.  It’s all quite scary, but let’s look at it point by point:

*Fully open line of credit from $10,000 to $250,000
So they’re not only going to approve your mortgage, they’re also going to give you access to a huge bank account full of money.  So either the borrower will use the line of credit to pay make the mortgage payments, or they’ll just spend, spend, spend.  Either way, I don’t like this idea one bit.

*Poor or no credit
Are we really in the point of the economic cycle where people with poor or no credit should be getting mortgages approved?  Isn’t this where the United States went wrong?  What’s worse: poor credit or no credit?  Does it matter?

*Beacon reject or scores from 400 and up
When I see the word “reject” in the advertisement, I can’t help but question the callibur of clients they are actively TRYING to attract.  So when you’re rejected elsewhere, come to 241 Financing?

*No NOA’s
So they don’t require any information regarding your tax returns, finances, or income?  They don’t need this magical piece of paper; this NOA that every single other mortgage broker requires?

*No proof of employment or income required
Okay, this is the worst point by FAR.  What kind of mortgage company doesn’t want any proof of employment?  It’s one thing to let the income verification slide, but it’s another thing to actually advertise it!  So basically, you can tell 241 Financing Inc. that you work as a freelance millionaire and you go from town to town finding bags of money like in a video game, and they’ll just take you at your word?  How does this work?  WHO are they getting to approve these mortgages?

And finally, look at what they’ve written on the side of the advertisement:

“TO ALL REAL ESTATE AGENS: WE CAN STILL DO IT…”

Do what?

Is it a secret?  What am I missing here?  What can you do that you won’t explain?

I have a few guesses here, but I’m assuming they mean, “We can still approve unqualified borrowers that REAL mortgage brokers can’t get approved – people that should never be approved in the first place!”

So if you’re a Realtor that sells your clients down the river, I guess you can take advantage of this company’s generosity!

Or, perhaps they’re saying they can still do 40-year-amortizations, which 99.9% of all lenders have stopped doing.  That is what I really think they’re insinuating.

Bottom line: this company has watched the economy fall apart in the United States and then copied their failed blueprint of how to run a lending institution.

Bravo.

Seriously, bravo.

But the best part came when I went to their website, and guess what I found?

How about…….NOTHING!

They don’t have anything on their website other than, “Coming Soon!”

(click to enlarge)

Imagine going to your bank’s website; take Royal Bank for example.  Imagine going to Royal Bank’s website and seeing “Coming Soon.”  Would this make you feel warm and fuzzy inside when contemplating giving your business to this bank?

Any fourteen-year-old with a laptop and an iota of competence can start a website, yet 241 Financing Inc. is only capable of putting up their logo, contact information, and the words “Coming Soon” on their web page.

I personally think that if somebody actually was going to use this company for their mortgage, going to their website would probably deter them from doing so.

In the end, I’d like to assume that most people would never get involved with a company who offers products that none of their competitors do, but some people are too trusting, naive, or just completely lack common sense.

I’ve had a couple of run-ins with mortgage brokers in the past week that gave me some food for thought.

And it gave me yet another story to tell, which I’ll do later this week…