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  1. #1
    Join Date
    Mar 2006
    Posts
    3

    Advantage Financial Group: Beware!

    I recently received a mailing that advertised a financial seminar promising the usual things: lots of additional income, debt freedom in under 4 years, etc., etc. I attended a 2 hour presentation by this company called Advantage Financial Group. The company buys homes that are in foreclosure and rents it out to the current occupant who then have the option of buying it back when their credit has improved. To do these real estate deals, they need individuals to hold the mortgages on these houses, they claim they are not allowed to hold onto regular mortgages as they are a corporation. They claim this is a win-win-win for all concerned since you get a share of the rent + home value appreciation, the company gets a share of the rent plus home-value appreciation and the owner/occupant gets to live in the same home and rebuild their credit.

    They claim that your upfront investment/cost for this entire scheme is $0 (which is true since I got out of the whole thing without any monetary cost). But there are a few troubling aspects to this program that you need to keep in mind before you decide to go with it.

    First of all, you have to open a Variable Universal Life insurance policy with a company that Advantage recommends and that will hold pretty much all your income from this scheme. They claim that this has tax benefits and is part of the "financial plan". In general, these variable life policies are bad deals because of the fees and other costs associated with them. But if you are going to put only your additional income from this scheme into this policy, then it is still no money out of your pocket, but I would have preferred a different savings vehicle.

    Secondly, the company CEO, Lee Loomis has very strong opinions, but does not back these up with very sound analysis. He is strongly against 401k's and IRA's. In these seminars, he goes around showing charts of how you save a little in taxes now, but pay a lot more later (which is true, but the point is not how much you pay in taxes, but how much you have left at the end of the day). I have my own analysis, which I believe is done the correct way, that shows (as most mainstream financial planners will show) that putting money in an IRA or 401k is much better than putting it in a taxable vehicle or even in a tax-advantaged vehicle like a variable universal life policy. Similarly, he has strong opinions about building up home equity (he claims that building up home equity is a waste since the money can be put to better use earning more money). He is in fact an advocate of negative amortization loans and other products that can actually keep you in debt longer, but one of his opinions is also that it does not really matter if you are in debt. He also has strong opinions about the stock market (does not acknowledge that over the long term, it is a pretty safe investment if you have the discipline to stick with it) and on and on.

    On top of being very opinionated, this person does not brook any dissent whatsoever. To explain this, let me get to what happened about 3 weeks after I attended the seminar. I was vaguely interested in the scheme since it did not involve me putting up any money upfront. I wanted to get to the inner workings and was going to go with the scheme unless it involved putting my current financial plan in serious jeopardy. So, I cooperated with these folks and applied for the insurance policy (had to undergo a physical for this), opened multiple bank accounts as they required me to do, collected all my financial papers from the past two years (W-2's, tax returns, pay stubs, home mortgage statements, bank statements, 401k statements, invest account statements, etc., etc.) and set up an appointment to actually meet one of their financial planners for further action.

    Today morning, I went to their offices and met with Lee Loomis himself. He looked at my paperwork and started off on the wrong foot by claiming that I was lying about my income. He said the income I was reporting in my tax return was not the same as what I was claiming in his worksheet. I explained to him that the income I reported in my tax return was after 401k deductions and other before tax items were taken out. I then took out a current pay stub, multiplied the gross income reported on it by 24 and showed him that it was the same income as I claimed on his worksheet. This is pretty basic stuff and any person who has filled out a couple of tax returns in his life knows that the number that goes on your tax return is not your total gross income. This did not inspire much confidence in this person's financial acumen or knowledge.

    Then, he came to a line in the worksheet where I showed that I had some credit card debt and the monthly payment I was making on that debt. I said I had that debt only because I got a good interest rate from the credit card and decided to use that instead of money from my home equity line of credit because the interest on my HELOC is higher. I don't use that credit card for any other purpose, so I don't carry any high interest credit card debt at all. But he started multiplying my monthly payment by 12 and claimed that that was how much in interest I was paying for that credit card debt. I tried explaining to him that the monthly payment included the minimum payments due for the card and so it was both principal and interest (and obviously, my outstanding balance on that card does go down each month and I know from the statement exactly how much in finance charges I am paying and how much of the minimum payment goes towards reducing the balance). He got very rude at this point and started shouting that I was not supposed to try explaining to him how credit cards work.

    So, I said, "I guess we have a difference of opinion here". He glared at me for a few moments and then with no warning, he just tossed my paperwork across the table to me and said, "we are all done here.". He then had me escorted out of the office.

    I will let you draw your own conclusions about this outfit, but here is my take on it. If at all this scheme actually makes money for anyone, it is probably not anywhere close to the kind of money that is shown in the slick presentation during the seminar to bait people. Most probably, the scheme ends up losing money for most people and because of the complexity of the process involving multiple real estate deals, cash value accumulation in a life insurance policy, etc., most people do not even realize it. The financially savvy are most likely to identify the problems if they are let into this scheme, so I am guessing I got shown the door for being too financially savvy. If that is not the case, this scheme is nothing but a cult and Lee Loomis is the God of this cult. You disagree with him and you are not worthy of joining the cult. They want only true believers who will jump off the cliff after Lee Loomis when he orders them to. If either of these scenarios appeals to you, you should check this company out, otherwise, you have hereby been warned. Enough said.

  2. #2
    Join Date
    Jan 2006
    Posts
    16

    Re: Advantage Financial Group: Beware!

    simonsays 401 k's are solid investments for future

  3. #3
    Join Date
    Jun 2007
    Posts
    23

    Re: Advantage Financial Group: Beware!

    You are right about the cult feeling. My boyfriend and I had dinner with him because he was pushing us really hard to join. I got that Amway feeling, he was aloof, almost bored with us, which in a way, made us feel stupid/inadequate. He never did explain the system as well as you did.

    The whole thing didn't seem legit, especially his lack of ability to clearly explain it to us (we both have postgraduate degrees) so I didnt invest. My boyfriend did. I have a bad feeling and have been trying to learn more about Lee Loomis, but I dont think Lee Loomis is even his real name.

    :confused:
    Last edited by rosiedane; 06-30-2007 at 01:06 PM. Reason: spelling, clarification

  4. #4
    Join Date
    Mar 2008
    Posts
    12

    Re: Advantage Financial Group: Beware!

    You are sooooo Right about this Group!
    Lee Loomis and Johnny Grivette had set up an Office in Chico, Ca. and they are being investigated by the FBI and Attorney General of the State of Ca.
    They have scammed alot of people out of their homes and deserve what is comming to them!
    Karen White was their Sec. and is now turning States Evicence on them.

  5. #5
    Join Date
    Mar 2008
    Posts
    8

    Re: Advantage Financial Group: Beware!

    I saw your post in another spot. I checked with the Attorney General's offices in California and Illinois. There is no mention of any problems or investigations with this company. Where can I go to check this out? Also, an investment opportunity seems out of the FBI's realm. If it's true I'd like to know. I can not find anything in regards to this investigation.

  6. #6
    Join Date
    Mar 2008
    Posts
    12

    Re: Advantage Financial Group: Beware!

    Fraud is deffinately in the Realm of the FBI: ie: Countywide!
    I will get you the name and number of the FBI agent in chico who is investigating this! Another arrogant statement by the lommis group!

  7. #7
    Join Date
    Mar 2008
    Posts
    1

    Re: Looking for the facts

    Most of what I have read hear is all hear say. People form an opinion and then twist it to there own personal taste. If you are going to perform a complete character assignation then the facts should be of more merit. History has shown that Mr Loomis has done all that he said he is to do for his members. Some may not like the way it is done and that ok, but again as an on looker I would like names, emails phones numbers dates etc; All the things necessary to bring out the truth. So far all I have read is allegations with nothing to back it up.

  8. #8
    Join Date
    Mar 2008
    Posts
    8

    Re: Advantage Financial Group: Beware!

    aircpt,
    You are making some serious allegations. In your previous post you state that Karen White, an ex-employee, has turned states evidence. I personally contacted Karen White about this and she stated that there is absolutely no truth to what you have posted. You have told a flat out lie. Now you claim you have the FBI agent's name in Chico. I read your earlier posts and did some due dilligence in followinig up on your allegations, none of which I have been able to verify or substantiate. At this point you have no credibility for your posts. It is easy for anyone to start making false allegations in the anonymity of an online posting service like this.

  9. #9
    Join Date
    Jun 2007
    Posts
    23

    Re: Advantage Financial Group: Beware!

    Update: My boyfriend's credit is suffering as a result of his investment. The reason they wanted him as a member is because he had good credit. They used his credit to purchase homes--the mortgage is in his name but they rent the properties and make the payments; he has 3 homes in his name. The problem is that they (Advantage) have been paying the mortgages late, and the late payments are affecting his credit score which went from over 700 to below 600. He was even turned down for a credit card.

    Another aspect of the credit report issue is the ratio of debt to income. His income is high but, now with these mortgages and his own mortgage his debt is 4.5 times his income.

    He is paying $500/month for a life insurance policy. The rent is eventually supposed to pay the premiums, but the numbers don't add up. Unless they are getting rent far in excess of the mortgage payments, the numbers don't work. And what happens if a tennant doesn't pay their rent???

  10. #10
    Join Date
    Mar 2008
    Posts
    12

    Re: Advantage Financial Group: Beware!

    Check out the Butte County Superior Court agenda and records to see what shape lawrence leland Lommis, advantage financial, Advantage Group, Northern Ca. Investments, etc. are in.

  11. #11
    Join Date
    Mar 2008
    Posts
    8

    Re: Advantage Financial Group: Beware!

    aircpt,
    You are the same person that emailed months ago that Karen White had turned state's evidence, which was a lie. You also said you would get the FBI agent's name that was investigating them. Several months later and I am still waiting for the name.

    I did go to the website for the Butte County Courthosue and yes there is an active case. It does not give any details except that it is for a breach of contract issue. So we have no idea of the details. I can speak to this though, that being in business today carries risk.

    I have had my own company for 11 years. I have been a member of trade organizations, a continual member of Better Business Burea, registered with and in compliance with all state regulations and am an honest business person. Even with that I have had 2 legal issues over the years. Both from disgruntled customers who decided that they had changed their minds several days to weeks later. There was no merit to either case.

    Again, I can not defend or comment on the case in Butte one way or the other because no details of the case are given. However, as an experienced business owner I can comment on the unfortunate reality that no matter what you do there is a good chance that you will have some sort of legal issue at some point. If you were to research the history of almost any successful business you will find some litigation history. Or as my attorney says to me, it's just a cost of doing business today.

  12. #12
    Join Date
    Jun 2007
    Posts
    23

    Re: Advantage Financial Group: Beware!

    Update: my boyfriend is getting many calls re: late mortgage payments everyday. He probably gets 5 calls everyday. They just bounced a mortgage payment. He has tried contacting the company but Mr Loomis appears to be on VACATION. My boyfriend has also been paying into a life insurance policy (this was required) and when he called the company it wasn't what he thought he was buying and Mr Loomis owns the insurance company.

  13. #13
    Join Date
    May 2008
    Posts
    23

    Re: Advantage Financial Group: Beware!

    Get your bf prepped for a lot worse. This scam has been perpetrated numerous times. "Rent" someone's credit, buy the house, refinance cash out, and then abandon it. Otherwise, keep enlisting new suckers to whom you can either attach new mortgages or transfer the existing ones. Either way, the "sucker" gets left holding the bag with no recourse. Did you bf have any contract with the relevant party? I bet he didn't. Did he sign any mortgage or purchase contracts? I doubt it. Buyer beware. Don't let anyone use your credit.

  14. #14
    Join Date
    Jun 2007
    Posts
    23

    Re: Advantage Financial Group: Beware!

    So far things are holding at Loomis. I however, did some research on the properties he supposedly owns. Loomis sent him a statement with the addresses and closing dates. One didnt exist, one looked like it was till on the market and the other closed the date Loomis said it did but it sold for a lot more than other properties in the area.

    To answer your question, he signed the loan docs.

    They're latest tactic is to plant blogs with favorable posts. Look at them, they were all created at about the same time, theyre all closed for responses and they all say roughly the same thing.

    He has to keep his investors from panicing because if they all ask for their money back at the same time...

  15. #15
    Join Date
    Aug 2008
    Posts
    6

    Re: Advantage Financial Group: Beware!

    This is an absolute scam. It is a real estate based ponzi sceme.

    The NARAS high rate savings account is a traditional ponzi sceme where "investors" are offered a rate of return of 12% on money invested. The majority of the money went (its gone) to making mortgage payments, covering genral overhead including salaries, and also making interest payments to a few "investors".

    Very soon LOOMIS WEALTH SOLUTIONS will no longer be covering mortgage payments, so all of the "members" who recently (or in the past) bought investment properties through LWS will be obligated to manage making payments on their own. Most to none of the properties have a positive cashflow, and many are very negative. In fact most are un maintained and not currently tenant occupied.

    The company made money by having its members buy properties or by having people invest into thier NARAS fund. The properties are purchased from highly motivated sellers, usually builders or companies who converted apartments to condos. These sellers were likely in distress with past due construction loan debt, and were willing to sell their homes below maket value. HOWEVER, the purchases were structured at market value or HIGHER so that a margin could be established between the payoff to the seller and the loan balance, which in turn gernerated a commission to LOOMIS WEALTH. For example, a property may be bought by a member at 380,000 with a mortgage loan of 304,000. The payoff of the seller may be 200,000 or so. The difference between the loan and the payoff was where the "profit" was generated.

    Loomis wealth ran out of money, and probably wasnt actually having buyers put money down on the properities. Fradulent escrow compaines would fraudulently varify down payment money. As long as the purchase money loan balances were greater than what the seller needed, there was money being passed on to loomis with every purchase. The problem is that for whatever money LOOMIS obtianed, the company would have to assume the mortgage debt (maybe $300,000), as his company was promissing a cashflow to its investors. No real effort was being made to actually rent the properties, so as you can imagine, after 300 or more purchases, the monthy expense of making mortgage payments is a multi-million dollar deal. If he was clearing $50,000 per propety, it was through incurring another $300,000 in debt. If the rate on that mortgage was say, 6.75%, what did that $50,000 really cost per month? Add to that expense the cost of his employees, the operating costs, plus all the money he owes from NARAS investments at 12%!!!

    To keep employees around, Lee has to offer exagerated salaries, which only compound the financial strain of such a business.

    There is no profit here. Just taking money from investors to cover heavy losses, and trying to finance enough purchases to use the loan money to cover the ever increasing debt load. All the statements being sent to his clients with so called NARAS accounts are nothing more than excell spreadsheet printouts, and have NO corellation to any accutal money anywere. The few clients that were able to cash-out simply benifited from the temporary liquidity created by new members investing, or new mortgages being created. Its important to display some fiancial ability, so when necessary, LOOMIS would make an effort to get someones money back to them. In these motivational seminar type scemes, you don't want people to start to experience any concerns regarding thier money. That would make recruiting difficult.

    This is a scam that is colapsing as this is being posted. The model was never successful, and this man never had any intentions of providing a service that was of any benifit to his "clients". If you invested money, you have more than likely lost it, and if you bought property, your credit may already be affected as LOOMIS WEALTH has run out of money and has been missing mortgage payments.

    If you think you are benifiting from this organization, you wont think that in the days to come. Even if you recieved your money on time. Even if you believe you got a great deal on an investment property. The money you were recieving was not from rental cashflows. It is simply money genrated from your mortgage. You are being paid money that you borrowed, or you are being paid money that came from your original deposit, or from some new investors liquidated 401k.

    This guy may end up featured on CNBC's "American Greed" show.

  16. #16
    Join Date
    Aug 2008
    Location
    Indore
    Posts
    3

    Re: Advantage Financial Group: Beware!

    there are loads of information available on net on LOOMIS WEALTH SOLUTIONS It is easy to learn more about what Lee Loomis has to offer in the financial world, because his company is constantly holding seminars and workshops to learn more about their services and programs. The average joint venture partners with Lee Loomis and his company build between $4,000 and $40,000 a year, depending on how many properties they purchase for investment purposes. The programs that Lee Loomis has advised are beneficial for his company, for all of his investors, and for the people who occupy the rental properties that they acquire.
    Vik
    -----------
    debt consolidation advice

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