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321Financial and 321 Loans – Contract Review and Disapointing Radio Silence

By on December 10, 2015

Information has been pouring in about companies in Florida and specifically about companies associated with Jeremy Marcus. People are using my tipster (send in your tips here) form to send information in.

Recently I wrote about a company named Omni Management Partners and as part of that agreement was an agreement for the credit repair company, Breeze Financial Solutions. The loan agreement sent in to me for 321Loans also contains a Breeze Financial Solutions agreement as part of it.

But what struck me on first glance is that while the consumer agreement says, “This Loan Agreement (“Agreement”) governs your Loan with 321Loans (the “Loan”),” the State of Florida says 321Loans is not an actively licensed lender.

Screen Shot 2015-12-01 at 2.38.03 PM

It’s odd quirky things like that which lead me to look a little deeper.

The State says 321Loans, Inc. withdrew their application for a consumer finance company license on May 21, 2015. The State also directed me to Florida Statute 516 which says, “A person must not engage in the business of making consumer finance loans unless she or he is authorized to do so under this chapter or other statutes and unless the person first obtains a license from the office.” – Source

Under the same statute, a consumer finance loan is defined as “a loan of money, credit, goods, or choses in action, including, except as otherwise specifically indicated, provision of a line of credit, in an amount or to a value of $25,000 or less for which the lender charges, contracts for, collects, or receives interest at a rate greater than 18 percent per annum.” – Source

The State did not specifically answer if the 321Loans labeled as “special purpose” were or were not covered by the statute when specifically asked. I was unclear if a “special purpose loan” is a loan or not a loan. On face value, since it is called a loan, you would think it would be, but that’s a decision only a lawyer or court can make.

But according to an alleged page from the Helping America Group sales manual the 321Financial loans are “disbursed directly to the Lender Approved Vendors” so it seems that it sounds like a loan since something of value is disbursed. And there is the issue of the consumer taking out a loan to pay for credit repair services. Wow, I bet someone with knowledge about the Credit Repair Organizations Act would love to weigh in on that.

Just a portion of the substantial amount of information I've received from concerned consumers.

Just a portion of the substantial amount of information I’ve received from concerned consumers.

According to Florida public records, 321Financial is an assumed named for 321Loans, Inc. 321Financial says they are located at 1410 SW 3rd St. Pompano Beach, Florida 33069 which is also the address listed for Berges Law Group. – Source

But records for 321 Financial says the real name of the company is 321Loans, Inc. at 1451 W. CYPRESS CREEK RD, SUITE 207, FORT LAUDERDALE, FL 33309 which happens to be the address also listed for the Otto Berges company, Consumer Protection Counsel that was sued. – Source

The person who signed the fictitious name application for 321Loans, Inc. was a Jeremy Marcus.

321Financial advertises they make bad credit loans to people with credit scores as low as 400. – Source

The full page advertisement on 321BadCreditLoans.com.

The full page advertisement on 321BadCreditLoans.com.

The alleged 321Loans agreement is 40 pages long. At least it was shorter than the 60 page Omni Management Partners agreement that was ridiculous.

The loan agreement says the loan disbursement will be used in the following ways.

Your Loan is a Special Purpose Service Loan. This means that the Loan is offered for a specific purpose and that we determine the manner in which we disburse your Loan proceeds. We disburse your Loan proceeds as follows: 1) We make one or more payments on your behalf to pay for fees charged by third party companies; or 2) we make one or more payments on your behalf to pay your creditors in the event that third party vendors and you jointly enter into a settlement or repayment agreement, contingent upon approval by you and the third party vendor(s). Disbursements are made in Monthly Installments, as set forth in the Truth In Lending Disclosure included in this document. Once your Loan is paid in full, a third party company may require that you continue its program, subsequent to the completion of payments of your Loan. Once the Loan has been fully disbursed, it is Borrower’s discretion whether he or she desires to continue the programs and/or memberships offered by third party companies. You are responsible for paying the program and/or membership fees of the third party companies within five (5) days of the Final Payment Date/Full Disbursement Date, should you decide to continue program and/or membership with the third party companies. Your Loan is offered via 321Loans, a Florida not for profit corporation dedicated to providing financial education and tools to individuals and families to maintain a healthy financial future. You can obtain a Loan from us for financing to pay for the fees of the third party companies, however we may require written underwriting approval for some companies before we offer you a Loan.

So unlike the claims in the advertisement or on the 321Financial website, which may lead a person to think they will get a loan they can use as they see fit, the loan will actually be used to pay fees for some other company or service. That is, at least as explained in the loan agreement.

READ  Helping America Group / 321 Loans - Consumer Complaint - April 25, 2016

But while the company is sending out a loan agreement the homepage of the website leads with this description of what they are offering:

What We Do

321Financial offers financial advice to people with all types of credit scores, from the worst to the best. We want to help you get out of debt and return to a life of financial freedom. We offer low interest special purpose financing for those who qualify.

We are dedicated to a vision that delivers this nation and its citizens out of negative deficits. We want to empower you to learn how to stop losing money through poor investments, high interest loans and erratic money management. Our goal is to provide high quality realistic special purpose financial education and financing for individuals and families through every stage of life. 321Financial is committed to teaching individuals as well as families how to make the best financial decisions to lay the foundation for a secure, prosperous future. 321Financial specializes in low interest rate special purpose financing.

I’ll admit, I don’t get it. How are people getting empowered or financially educated through bad credit loans? And what’s with the mention of settlement agreement with creditors?

According to public records, the website for 321Financial.com is hosted on a server with the following domain names:

321badcreditloans.com
321financial.com
321loans.org
bergeslawgroup.com
debtconsolidationnow.com
debtdismissal.com
jeremymarcusdebt.com
jeremymarcusfinance.com
jeremymarcusflorida.com
paralegalsupportgroup.com
unitedfinancialsupport.org

As part of the agreement I have in hand, not only is the consumer agreeing to some sort of loan they don’t get the proceeds for, but also about $2,000 of Breeze Financial Solutions credit repair services. Or as Breeze Financial calls them:

SERVICES – Breeze’s services include an analysis and consultation of your credit report, credit score recommendations appropriate to your needs, and preparation for the dispute process. Breeze will verify accuracy of your information; prepare correspondence for all three (3) credit reporting agencies to challenge and attempt to remove inaccurate, incomplete, misrepresented, unverified, erroneous and/or out of date information pursuant to the Fair Credit Reporting Act; analyze credit bureau responses and findings; prepare correspondence to respond to credit bureau findings; inform you of updates to your account; and take all other necessary steps to ensure the best possible results.

I did reach out to Howard Dvorkin, CPA and CEO of Debt.com for his impression on the loan for services. He said, “The old adage “If something is too good to be true – it usually is” has been around for decades because it’s the truth. It looks like this company is promising to help people get out of debt while putting them deeper into debt.

To those who are struggling with debt, I beg you: don’t sign anything until you receive a free debt analysis with a reputable credit counseling agency. Then review all the advice you get, check with the Better Business Bureau and other review services. If someone says you need to sign up NOW, walk away NOW.”

A spokesperson for the American Fair Credit Council said, “This raises several significant concerns. Firstly, no company helping negotiate, alleviate (or dismiss) consumer debt can guarantee results. Secondly, consumers need to be extremely wary of any debt relief company that charges upfront fees. At a minimum it is a bad practice, and it is likely also a violation of Federal Trade Commission rules. The old adage, if it sounds too good to be true, it probably is, seems quite fitting here.”

READ  Why is Berges Law Group Checking Client's Criminal History for Credit Repair?

A Bit More

Readers will never understand how frustrating it is for me to frequently reach out to companies for their side of the story or a clarification, but to get no response back in return. And sadly that’s what has happened here.

A day ago I sent the email below to Jeremy Marcus, Craig Smith, Yisbet Segrea, and an alleged 321Loans Team Manager. I did not receive any response from anyone.

Hi All,

First off, thank you so much Jeremy for contacting me 5 days ago. I replied but did not get a response so I’m emailing y’all so I can get this article on 321Loans out the door.

If you have a designated media contact person for all the companies, let me know. I hate to bulk email but I’m just trying to get a response.

I’m looking for a quote to respond to the State of Florida who says 321Financial/321Loans withdrew the consumer loan license in May of 2015.

I’m curious if that was because y’all did not feel the special purpose loan was covered under Statute 516 or there was some other reason?

If you can please send me a quote for the article, I would really like for readers to hear your voice and statement about that.

Here is the section of the pending article I’m looking for a response about.


The State says 321Loans, Inc. withdrew their application for a consumer finance company license on May 21, 2015. The State also directed me to Florida Statute 516 which says, “A person must not engage in the business of making consumer finance loans unless she or he is authorized to do so under this chapter or other statutes and unless the person first obtains a license from the office.” – Source

Under the same statute, a consumer finance loan is defined as “a loan of money, credit, goods, or choses in action, including, except as otherwise specifically indicated, provision of a line of credit, in an amount or to a value of $25,000 or less for which the lender charges, contracts for, collects, or receives interest at a rate greater than 18 percent per annum.” – Source

The State did not specifically answer if the 321Loans labeled as “special purpose” were or were not covered by the statute when specifically asked. I was unclear if a “special purpose loan” is a loan or not a loan. On face value, since it is called a loan, you would think it would be, but that’s a decision only a lawyer or court can make.

If you have any additional information to share, please respond and I’m happy to include what I can.

Oh, one more question. If the 321Loan is disbursed to Breeze Financial as it says in the loan agreement, is your position that the disbursement of the loan to Breeze does not constitute a consumer liability and thus does not wander into the Credit Repair Organizations Act?

I have a couple of quotes already from industry leaders on the 321Loan agreement so I’m just waiting for a response from someone there and then I can publish. Please send back your response for inclusion by noon ET on Thursday.

Steve

P.S. If someone wants to also take a look at https://getoutofdebt.org/96562/omni-management-partners-client-agreement-review-leaves-wondering and provide a response to that article as well, I’d love to include a quote on exactly how you assume the liability for a debt you are not a party to.

There was absolutely no response received from any of the four people.

So based on the lack of a response, the only prudent advice I can give someone who is considering using any of the companies is to do your own homework.

  1. The Ultimate Consumer Guide to Checking Out a Debt Relief Company Before You Sign On the Line
  2. 10 Must Do Steps to Find the Best Credit Counseling or Debt Settlement Company for You
  3. How to Check Out a Business or Company to Avoid Getting Scammed or Ripped Off

And that’s where it stands. It’s a conundrum wrapped in a mystery at this point, for me.

If anyone has any information to share, Please send in your tips here.


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About Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

5 Comments

  1. angrycustomer

    January 16, 2017 at 4:22 pm

    321 financial/helping america group is reporting customers “loans” to transunion as NGP ENTERPRISES LLC. its a fraudulent loan so im not sure how to get it off of my report. Ill research that next.

  2. Joe Keyes

    January 16, 2016 at 4:28 pm

    Hi, Steve:

    I like this article as I am dealing with this Company and its third party vendors right now. The funny thing is: On the very day that I made a loan agreement with them is the very day that they withdrew their license to issue loans. Doesn’t that make the loan agreement illegal? Then, they supposedly assigned my agreement to NGP Enterprises: doesn’t that seem strange?

    • Steve Rhode

      January 18, 2016 at 2:29 pm

      You would need to raise those questions with them or your state Attorney Generals’ office.

  3. Alex Ander

    December 10, 2015 at 5:11 pm

    This is the company I sent you a facebook message about the other day. They’re the ones that sent me the “debt consolidation” solicitation. Do you or anyone know how they could legally get my exact revolving credit balance without triggering the FCRA and thus having their name show up on the consumer-side view of my credit file and having to print the FCRA disclosures required by section 615(d)?

    • Blen Butterson

      December 17, 2015 at 12:12 am

      A lot of times they will partner with a shady mortgage or auto lending company and do the credit check that way. Or, they may buy data from a credit aggregator who is violating FCRA by selling “leads” without a “permissible purpose”. I’d check your credit report for any inquiries from companies you don’t recognize, but it may take some detective work to see how they are linked to this company.

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