Politics are funny. Candidates running for President are telling you how everything is a train wreck and how they will fix it. President Bush and Fed Chairmen Ben Bernanke will tell you that everything is fine.

Yesterday, President Bush and Ben Bernanke, in separate speeches, acknowledged (the obvious – that we are in an economic slowdown. However, they both assured the country that we are not heading into a recession. Of course, this is the same set of politicians that was assuring the country that this real estate bust would not be a problem.

You are never going to hear a politician acknowledge something until it is obvious. Until the economic growth numbers come out negative, it will be the same old political spin. Does anyone actually think that we are going to avoid a recession?

Let’s look at the reality of things:

Personal income for most consumers is not increasing and has not increased in a long time
Corporations are hesitant to invest money to expand because of the uncertainty
Investors are hesitant to invest money because of the uncertainty
Consumer spending is vanishing
There is no solution to the foreclosure crisis in America
Oh year….. $ 100 plus oil

Yep, things look good to me.

I really hope that our next President handles things more effectively and realistically. It is the policies of this Administration that has landed this country in the mess that we are currently facing. It is the same Administration that continues to tell the American people “all is well.” Unfortunately, the reality of the pain that is being felt by consumers is telling another story.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: Bob Brooks, Chairman Ben Bernanke, economic slowdown, Foreclosure Crisis, politicians, President Bush, Presidential Candidates, Prudent Money, real estate bust, recession

If you listen to the financial services industry, there is only one way to invest. The only strategy that the financial advisor community has focuses on is growing investment accounts. It is a performance-based system for investing.

The problem is that there is very little emphasis placed on protecting investments when the markets go through rough times. What happens when if a bear market comes along? The advisor community doesn’t have a strategy for that type of environment. Thus, they remind you that you are a long-term investor and to just “ride it out.”

This strategy is dangerous for one reason. You make money in the bull markets and you give most of that money back during the bear markets. That is the danger of the one strategy investment process.

The focus is always on the good years. It is all about performance. Now the financial services industry bases the notion of performance on an illusion. If you were to look over the last 79 years, the stock market (represented by the Dow Jones) gained money 66% of the time and only lost money 44% of the time. Therefore, the conclusion is that the emphasis should be on the positive good growth years because there were as much 1/3rd more good years. Why care about the loss years since there are more growth years?

Well there in lies the illusion. The stock market might have lost only 44% of the time. However, the negative years had much more of a negative effect on investment values than the benefit gained from the positive years. The reality is that there is major importance to be placed on protecting your investments from the bad investment years.

Think about these percentages for a moment:

If you lose: % required to break even

-10% +11%
-20% +25%
-30% +43%
-40% +67%
-50% +100%
-60% +150%
-70% +233%

You could easily lose 50% of your money in a bear market over a short time period. Unfortunately, it would take an investment return of 100% just to break even. It would take a long time to recover.

Take for instance the greatest stock market crash of all time. The 1929 stock market crash created an 88% loss in just a mere 3 years. It took 3 years to wipe out 8 years of investment gain. Then it took another 22 years just to get back to even again.

This is why it is important to have a strategy to protect against loss. Negative years in the stock market can be much more devastating then the benefit from the good years.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: 1929 stock market crash, bear market, Bob Brooks, Bull markets, Dow Jones, financial services industry, Protecting Investments, Prudent Investing, Prudent Money, Stock Market

One of the areas that I will be covering at my seminar is the concept of diversification. Diversification is your main tool to combat risk in your investment portfolio.

So what is diversification? It is the process of spreading your investment risk across all types of investments that historically don’t move in the same direction. The key is that the investments balance each other out. For instance, if stocks are going down, bonds are hopefully going up. Maybe you are using alternative investments or real estate investment trusts. It is all a balance.

Unfortunately, most investors confuse diversification with quantity. The thought is that they are covered for risk as long as they have their money spread out over many different investments.

I was meeting with an individual and he made the comment that his 401(k) plan was well diversified. He showed me his portfolio. His money was spread out over nine different mutual funds. The problem is that his money is 100% invested in stock. The probabilities are high that in the event of a market downturn, all nine of those mutual funds will move in the same direction. That is absolutely no diversification at all.

If you are going to use a buy and hold approach with your investments, then you will need to use a strategy that I call extreme diversification. This would require you to spread out money over all many different types of investments so to balance out risk.

Another way to diversify your money is simply looking at it from the standpoint of how much you have invested in stocks, bonds, and money markets or fixed type of investments. The percentages that you use will greatly impact the amount of risk that you are taking.

For more information about the seminar go to this link – there is very limited seating left.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: 401(k), Bob Brooks, bonds, Buy and Hold, diversification, investment portfolio, investment risk, investments, money markets, mutual funds, Prudent Money, real estate investment trusts, risk, stocks

Yesterday I had the opportunity to interview Bill Fleckenstein on his book Greenspan’s Bubbles – The Age of Ignorance at the Federal Reserve Board. Throughout the book, Bill goes through the almost arrogant attitude of Alan Greenspan and how he thought that he could control everything through the Federal Reserve Board and the manipulation of interest rates.

In the book, Bill writes about some of the financial catastrophes that Alan Greenspan had a part in which include:

The Stock Market Crash of 1987
The Savings and Loan Crisis
Y2K
The Tech Bubble
The Housing Crisis and Credit Crunch

The book is a disturbing account on how things really work at the Federal Reserve Board and how out of touch they are with reality.

At one point during the real estate boom, Alan Greenspan actually encouraged the use of adjustable rate mortgages as a way to finance real estate. Now adjustable rate mortgages are the problem today and I would suggest that they are the main reason so many people are losing their homes.

The irresponsibility of that ringing endorsement of adjustable rate mortgages by Alan Greenspan came at a time when interest rates were at historic lows. Translated, they had no place to go but up. That would make an adjustable rate mortgage a horrible mortgage for new home or a refinance.

I asked Bill (who has closely followed Greenspan’s career), “What was Greenspan thinking when he endorsed the use of adjustable rate mortgages?” It was real silent on the other end of the phone line. I could just picture Bill shaking his head and then saying, “Who knows?”

Unfortunately, Ben Bernanke is equally as overconfident that the Federal Reserve Board can just fix things. I think that in time we are going to discover that the Federal Reserve Board has very limited power over this current credit crunch.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: adjustable rate mortgages, Alan Greenspan, Bill Fleckenstein, Bob Brooks, Federal Reserve Board, financial catastrophes, Greenspan's Bubbles-The Age of Ignorance at the Federal Reserve Board, manipulation of interest rates, Prudent Money, real estate, Real Estate Problems, Stock Market Crash of 1987, The Housing Crisis and Credit Crunch, The Savings and Loan Crisis, The Tech Bubble, Y2K

I am seeing a trend in Washington. It seems that Washington is falling into this habit of introducing real strong legislation aimed at helping consumers against credit card companies as well as programs to help people who are facing foreclosure. They are announced with big fanfare. Then, as if nothing were ever announced, you hear nothing about them again.

There was a strong piece of legislation aimed credit card company reform that was being discussed on Capital Hill last year. I made the statement then that it would be a miracle if it ever became law because it was a good piece of legislation that would regulate the unethical practices of credit card companies and help the debt strapped consumer.

Either politicians have good intentions and actually think that they can get good consumer legislation passed or our politicians are just going through the motions in order to look like they are actually representing the people of their district. Realistically, it is a little bit of both.

Politicians, regardless of their intentions, will come up with pretty common sense solutions that really would help consumers. The problem is that good solutions for the American voter and consumer don’t make good political solutions. After all, it is big business that lines the coffers of politicians. Thus, these pieces of legislation fall by the wayside.

The latest is a bill of rights for credit cardholders designed to level the playing field between credit card companies and consumers. The bill is aimed at preventing major credit industry abuses while fostering fair competition between card issuers.

Most of the bill is fluff. They want to force credit card companies to be clearer about the terms and conditions. Of course, that is really not going to solve anything. The right credit card legislation has two important details.

First, it would not allow credit card companies to arbitrarily raise interest rates. This is referred to as the universal default clause where you sign on the dotted line, giving the credit card companies the right to raise rates for any reason.

Second, it would forbid excessive fees charged by credit card companies.

Those are the two fixes that are needed in the credit card industry. If those two simple laws went into effect, we would have made some real good progress.

To take it a step further, Congress should limit how high credit card companies can raise your credit card rates. Currently, they shift that burden to state government. This is a real serious issue for consumers. I wish someone in Congress could tell me why 30% plus interest rates are fair to the consumer?

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: bill of rights, Bob Brooks, Capital Hill, Congress, Credit Card Companies, credit card holders, credit card legislation, Debt, Foreclosure, interest rates, politicians, Prudent Money, terms and conditions, Washington

When the stock market is losing money, companies come out of the woodwork promoting investment products that guarantee returns. People are much more susceptible to “guaranteed” investment products when the market is an emotional roller coaster.

I had a client email me today asking about an outrageous claim that one radio host was making this afternoon as she was guaranteeing an 18% return in a year in her investment program.

Legitimate investment strategies are highly regulated by both the Securities Exchange Commission and the National Association of Securities Dealers. There are very strict laws the prohibit anyone licensed to represent securities to make implications or outright guarantees of investment returns.

If that is the case, then how do these programs broadcast on the radio and make outrageous claims? Well most of the time, they are not true investment products but actually insurance products that look like investment products.

So, if you are approached by the next great guaranteed investment, ask the following questions:

- If the return is guaranteed over a period of one year, ask if you will receive your original investment at the end of the period plus the guaranteed return with no strings attached. So, for the lady claiming the 18% guaranteed one year return, I would want to know that I could get back my original investment plus that 18% in a check with no strings attached.

- If the return is tied to one of those equity indexed annuity products where they promise you will never lose money and you will also make money when the stock market goes up, ask them if you are guaranteed to get the investment balance that you see each year on your statements with no strings attached.

- If you get the answer of yes to any of these questions, then ask to get it in writing with a written explanation of the guarantee.

The reality of the situation is simple. The only guarantee that can be made when it comes to investing are risk-free investments such as a CD. If you are attempting to make a return greater than what you can make above and beyond a risk-free investment, then you are taking risk of some type. There is no free lunch. However, there are promises and guarantees with many strings attached.

By the way, if anyone can provide an investment with a huge return and guarantee, please let me know. I would stop taking risk and trying to manage money and just sit back and reap the rewards of a nice fat guarantee. Of course, so would everyone else in the investment business and no one would take risk.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Let’s face it, you can insure just about anything these days. There is insurance for just about everything. You could even find yourself in a situation where you had so much insurance coverage that you are barely able to make the premium payments.

The best case scenario is to have insurance and never need it. However, when tragedy does strike, you are thankful for every premium payment that was made. I had a first-hand experience with long-term care coverage for my mom. My mom, who has Alzheimer’s, spent about a year and a half in a nursing home prior to her death. Fortunately, the long-term care insurance paid for everything.

With or without my personal experience, I have always though that long-term care insurance should be a part of a person’s retirement plan.

You have to address the question – How will you pay for a long-term illness that requires a nursing home stay? Do you have enough money in investments or in monthly pension benefits to cover $ 4,500 to $ 5,000 a month in nursing home expenses? Do you really want to push that burden on your family? These are some tough and important questions.

So, here are some things to consider when evaluating long-term care insurance:

Can you self-insure? I have some clients who have plenty of income each month from social security and pension plans, so that if a long-term care expense were to occur, they could pay for it. Of course, they can easily pay for the long-term care insurance as well. It might be that you figure you could self-insure part of the cost. Thus, you take out a smaller insurance policy to take care of the gap between the cost and what you can pay.

What are your family members’ thoughts? It is important to consult with family members about long-term care. It is the family members that can end up suffering the most when these things are not taken care of ahead of time. It might be that a son and/or daughter might be willing to help pay for some of the long-term care just to make sure that everything is covered. This ends up becoming a family risk. Make sure everyone gets input.

What long-term care benefits are the most important to you? You can get a long-term care policy loaded with all of the bells and whistles. You also get a big fat premium payment. I think that the must-have benefit is the inflation rider. You definitely want the insurance to keep up with inflation. However, other parts of the policy are negotiable.

When applying for a policy, you get to choose the waiting period. This is simply the number of days that you wait prior to the coverage starting. If you think that you could afford 180 days without coverage, your premium could be much lower. Of course, the most expensive policy would provide coverage from Day 1.

The other benefit is length of coverage. The most expensive is coverage for a lifetime and then it goes down to coverage for just a year or two.

Make sure that you customize your policy to where it makes sense for your needs and your pocketbook.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: Bob Brooks, Deceptive Money, insurance, investments, long-term care coverage, long-term illness, money, premium, Prudent Money, retirement plan

Treasury Secretary Hank Paulson announced yesterday that 6 of the major banks have come to an agreement to freeze the foreclosure process for 30 days. This is for borrowers who are more than 90 days late. The program is called Project Lifeline.

Now how is that for a plan of action? Are things that bad that the Government has to recommend halting the foreclosure process for a measly 30 days just to figure out what to do next? For most homeowners that are in trouble, an additional 30 days does nothing more than postpone the inevitable.

Well, the foreclosure problem is that bad and looks to get much worse. The Government has a real problem on their hands that could have been prevented if they would have done their job.

Let’s look at this for what it is at face value. We could face an alarming number of foreclosures in 2008 and 2009. Of the homeowners that are in trouble or will be in trouble, a percentage were victims of predatory lending. I would suggest that the vast majority understood they were taking out a loan based on a low payment and buying more home than they could afford.

The system is way too complicated for a government intervention and bail-out. The consequences would be enormous. Someone should tell the Democrats about the consequences. Senator Clinton, with all of her “I told you so”s, chimed in again today saying that she is the only one that has been warning about this and has been for a year. Of course, her solution is to freeze interest rates for years and save the day. Oh Hillary, if it were that easy. Incidentally, this has been a news story for well over a year now. Just like Al Gore didn’t invent the internet, she didn’t warn the world of the impending foreclosure problem.

Then there is my favorite. Now Senate Banking Committee Chairman Christopher Dodd is a real piece of work. He thinks that the Government should buy these loans and re-work them. Seems to me that if his committee was overseeing the banking industry effectively, these irresponsible loans and loose lending standards would have never happened. Just like every other good politician, his solution is to just let the government flip the bill for the problem.

How about pointing to the banking community who created this problem? How about forcing them to rewrite these loans at today’s rates on 30-year fixed notes, regardless of credit? If the homeowner cannot still afford the payment, then nature must take its course. Is Congress protecting the banks or doing its best to protect the consumer? It really is tough to tell.

A program should also be set up to help those who can prove that they were a victim of predatory lending. That group would include everyone who was allowed to buy a home without proof of income. That is a clear example of predatory lending. This problem and solution should be on the shoulders of the banking community.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: bail-out, banks, Bob Brooks, Deceptive Money, Foreclosure, Governtment, Homeowners, mortgage, Project Lifeline, Prudent Money, Treasury Secretary Hank Paulson

Making your credit score the best that it can be isn’t rocket science. Fortunately, you really don’t need to pay those services big dollars to do something that you can easily do yourself. However, you do need to know how to go about the process the right way.

Remember, that on your credit report (and you have 3 of them – TransUnion, Equifax, and Experian.), all items should be classified in one of three ways.

1) Correct
2) Inaccurate – information is correct; however parts of it need to be corrected
3) Mistaken – the information is not yours and needs to be removed

There really is nothing that you can do if it is correct. If you have a bankruptcy or a collection item on your credit report, then it stays until it serves its time. Each negative item has to stay on that credit report for 7 ½ years past the first missed payment.

The information is inaccurate (balance or date is incorrect, etc.) then it is important to dispute the information and request that it is corrected.

Mistaken information definitely needs to be disputed and requested to be removed on the basis of mistaken identity.

As you would guess, the three credit reporting agencies all have their own ways that they want you to go about the process.

TransUnion – They have three different ways to dispute. If you mail it in, they have a form that needs to be filled out. For complete information including forms and addresses, click here.

Equifax – They also have 3 different ways to dispute information. They are the easiest to deal with because they don’t require any additional forms. For complete information including forms and addresses, click here.

Experian –They have one way to dispute. In order to dispute an item, you must buy a credit report from them so that you have a credit report number. They are running a racket. Then you dispute everything online. What a rip-off!! For more information, grab your credit card and go here.

So, here are a couple of tips:

1) If it is a minor item, dispute online or over the phone. If it is a big item, always dispute through the mail using certified mail with a request to send you a receipt. This is the most effective way.
2) When disputing something, include as much evidence to support your claim as possible.
3) If you want to get around the Experian credit report fee, you can always dispute the same item with another credit reporting agency. Most of the time, an item will be reported on at least two of the three credit reporting agencies. If you dispute the item with one agency and they rule in your favor, they then communicate with the other agencies and have them correct or remove the information.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: bankruptcy, Bob Brooks, collection, credit report, Credit Score, Deceptive Money, Equifax, Experian, Prudent Money, transunion

The mortgage marketing machine is running in overdrive and aimed at getting your mortgage. For the most part, the teaser rates promising ridiculously low rates are gone. Mortgage companies now have moved on to other ways to get your business. Now the method of choice is the personalized offer.

Mortgage companies armed with information on your mortgage are sending out personalized offers to refinance your mortgage. The solicitation is designed to look like a done deal. It is an offer much better than the current mortgage. The marketing message leaves the impression that only a signature is required and the low rates are a given.

One listener wrote me about an opportunity to get her rate lowered from 9% to 5%. She was hopeful that this was a good deal for her.

Well, yes it is a good deal……if she qualifies. Yes, it is a good deal if she qualifies and the deal is not back-loaded with excessive penalties. If you are paying high interest rates on your mortgage and are facing the prospects of an adjustable rate mortgages, you still have to qualify for a new lower interest rate mortgage.

What if you don’t qualify? Could there still be an opportunity for a new mortgage? I am currently working on a story for the Under the Radar Newsletter that uncovers one bank’s offer to refinance a mortgage at a higher interest rate. Why would anyone be interested in a higher interest rate?

Well, this bank is doing it under the pretense of a debt consolidation/mortgage plan. Not only were they going to charge almost 1.5% more in interest on the total loan, they were also going to charge 4% in fees to close the note. What’s worse, this bank called the listener on his cell phone and pitched the deal.

His credit score is 596 (considered a poor credit score) and they want to offer this deal because he is a “preferred customer.” Be watching for that story in the Under the Radar. This is clearly predatory lending.

Rules of thumb:

- If you need to refinance, do so only if the overall interest costs are reduced.

- Those with a good credit score and substantial equity in their home have more options available to them.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: Bob Brooks, debt consolidation, Deceptive Money, interest rate, lending, loan, mortgage marketing solicitation, Prudent Money

Tags: America, Bob Brooks, Congress, credit industry, credit laws, Deceptive Money, economy, Homeowners, Housing Crisis, human rights, markets, Mortgage Industry, politicians, Prudent Money, Roger Clemons, steroid scandal, tax payer money

Debt is a tough subject for most to discuss. I would suggest that it is the biggest financial challenge facing Americans today. So, where does the Bible stand on debt?

Since we talk a lot about debt here, I wanted to give you some Biblical views to consider today. We will talk about various ways to reduce the impact of debt or to negotiate debt that is in collections. We will often even discuss what happens if you walk away from debt. It is my role to answer your questions and give you the facts of the situation.

I have always felt that when people call in with these tough questions, they want straight facts and not an answer designed to make them feel guilty for their situation. If you are like me, it is easy to feel guilty without the help of someone else. I also don’t always give unsolicited opinions on their situation. It is not my role to pass judgment. Prudent Money should be a safe place for you to come and get information.

Having said all of that, I do want to take the time to share with you my views on debt from a spiritual perspective. In talking about twelve key Scriptural references in the Bible; these are my conclusions. It comes down to moral obligation, dependence, and freedom.

1) I believe that you should always pay back what you owe. Debt is a contractual and moral obligation that we make with someone. Whether or not we like the terms and conditions, at some point we did agree to them.
2) Paying back your debt takes your relationship with Christ to whole different level. Paying back debt brings us back to a level of dependence of Christ. It is the strength of that level of dependence that forms the foundation for a strong relationship. I have often said that it is debt that brings Christians to their knees and back to God.
3) If we are in debt, we are not free as we can be to serve. We want to be 100% free to serve in our relationship with Christ. If we are not in a place to where we can commit 100% of our time and attention to Christ, then we are a slave to man as it says in 1 Corinthians 7:23. We also want to be free to serve others as well.
4) Christ doesn’t want obligations above the relationship with Him. If you are in debt, you are completely obligated. Until you get out of debt, it is hard to be in a place where you can give 100% of yourself. Debt can become something that develops a life of its own.
5) Most debt problems are created due to not living a Matthew 6:24 life. There comes a time when we have allowed money to be a god. It is so easy to enjoy all of the immediate short-term gratification that debt can give. It can be powerful feeling from a powerful stimulant. The key is getting back into God’s financial will for your life. It is only there that you can start your road back to freedom.

So is debt a sin?

Money was written about more than anything else in the Bible. God knew that we needed instruction on dealing with money. He knew that it would get in the way. Debt is a powerful tool of commerce. If used correctly, it can be a good prudent strategy in how we handle His money.

The key is using debt the right way. If you are going to borrow money, know how you are going to pay it back. Know without a doubt you are not making a commitment that will not in any way get in the way of your relationship with Christ. If you have debt, commit to a game plan to where you can get out of it. Make the two objectives freedom from everything and dependence on Him.

The Bible does not specifically say that debt is a sin. There are many things in the bible that are not specifically mentioned as a sin. It is letting those things get out of control and get in the way of your relationship with Christ that becomes the problem.

That is the problem with debt. It can happen in an instant if we are not guarding our wallets and our hearts.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: America, Bible, Bob Brooks, Debt, debt collections, Deceptive Money, Prudent Money, sin

You can go back and say that things in the stock markets are always uncertain. There are always the unexpected problems that appear that create the greatest risks. The stock market hates uncertainty. Unfortunately, we could be in a historic time of uncertainty that lasts a very long time.

I interviewed Mike Larson yesterday on my program. He is the Senior Real Estate Analyst on Money and Markets. For more information, his website is www.moneyandmarkets.com.

Many of the tougher questions about where the real estate and credit crisis leads were met with the response that it is so hard to tell because no one really knows the extent of the risk. Thus, we can paint all types of scenarios going forward. The bottom line is that debt is the problem and we are a country that is in trouble with debt. It has a reckoning day and doesn’t just go “poof” in the night.

I would encourage you to listen to the podcast interview with Mike. This really gives you an idea of what we are up against as a body of investors.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: Bob Brooks, credit crisis, Deceptive Money, Mike Larson, Prudent Money, real estate, risks, stock markets, uncertainty

It seems like very two weeks the Government is coming out with some type of bail-out plan for the American consumer. Last week, it was the stimulus plan announced by the Government. Weeks before, it was Project Hope. Today, it is Project Lifeline.

Here is what all of these plans have in common:

1) They are nothing more than sketchy announcements where the details are to be worked out into the future. Unfortunately, that never seems to happen.
2) They are never as advertised. For instance, the Government announced that they will make it easier for people with Jumbo Loans to get refinanced. Unfortunately, if you look at the fine print, very few will benefit.
3) They are nothing more than political sound bites. Hillary Clinton announced today that President Bush is finally doing what she said to do all along. With all due respect, Senator Clinton, I wouldn’t put my name behind the so-called solution that President Bush is suggesting.
4) They are all band-aid approaches that only time will fix. These plans just prolong the pain.

So what is the solution? I think that the Government needs to get out of the way and let this credit crunch fix itself. That could have some consequences. However, those consequences will not go away. We either face them today or face them tomorrow.

Congress needs to write strong mortgage rules and regulations that will prevent fraud from occurring again. Unfortunately, the way they would like to enforce the mortgage industry is a real soft approach. They need to get tough with that industry.

The train has left the station and the problems are very real. Unfortunately, all of the political sound bites in the world are not going to correct this problem (that the Government allowed to happen in the first place).

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: Bob Brooks, credit crunch, Deceptive Money, Government Bail-out plan, Hilary Clinton, President Bush, Project Hope, Project Lifeline, Prudent Money, Stimulus Plan

“This just in – The government has been saddled with 1000’s of foreclosed homes and they want to get rid of them. They do not want to be in the business of owning real estate. Now, in this special offer, you can get a list of the homes in your area. We will send you these special lists so that you can buy your home at an incredible value. Now listen to this special instruction. If your name starts with the letters A through N, please call today. If your name starts with the letters M through Z, do not call today. We will not take your call. You can call tomorrow.” – Advertisement heard on the radio

So, I called. Unfortunately, I was calling on the wrong day. I asked the lady why she was taking my information when I wasn’t suppose to be calling. She said that they just say that to control phone call activity. You have to be kidding me.

In the script that she read, she stated that this list contains homes that will be sold for less than $ 1,000. They will even pay your first month’s mortgage payment if you buy from their list. In addition, they will send you all of these special offers. Of course, there is a free trial offer.

If someone could buy a house for under $ 1,000, do you think that they would tell anyone their secret?

Why do I point out something as ridiculous as this marketing message?

I point it out because this company would not be marketing this scam if they weren’t making plenty money. People are falling for this marketing message.

Please don’t keep these businesses in business by falling for their scam. If it sounds too good to be true or even to the extent of being ridiculous, then it probably is too good to be true and it is very ridiculous.

Even if they had a legit service, would you want to do business with anyone who uses sleight of hand marketing?
Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.

Tags: Bob Brooks, business, Deceptive Money, foreclosed homes, Government, marketing, martgage payment, Prudent Money, real estate, Scam