Campbell startup plans to help financial professionals manage their clients’ debt liability
Last year, consumer debt in the United States grew to record levels, passing $8 trillion according to the Federal Reserve Board.
One valley company sees a multibillion dollar opportunity as consumers may be unaware of cost and tax benefits on some debt, and increasingly rely on financial advisers for help.
FinancialCircuit Inc., a Campbell-based financial software company, says it has a tool that could help financial professionals help their clients manage their debt liability.
“Typically the financial industry is focused on helping clients with their assets. But everyone understands that actual net worth is your assets minus your liabilities,” says Adrian Nazari, CEO of FinancialCircuit.
He says his company’s new software product, called MoneyFind, which sells for a $70 monthly subscription, will help clients of banks, insurance companies and accountants cut costs in paying back loans.
MoneyFind can help save money by automatically auditing current loans to see if they are getting the best interest rates and tax breaks. It works by taking advantage of eased federal regulations that allow secure, encrypted sharing of financial data to scour 250 lenders to find the best rates for each loan to be refinanced.
FinancialCircuit, which was founded in 1999, has a hard task ahead of it to convince banks to compare loan costs to their competition rather than go it alone with their own software.
“Currently, we don’t put competitor pricing on our Web site,” says Bruce Cornelius, a senior vice president at Countrywide Financial Corp., which has Bay Area branches.
FinancialCircuit’s Nazari says traditionally many consumers do not shop around for the best rates on car loans and certified public accountants have had a hard time explaining to clients why smaller loans should be refinanced.
“We’re very strong in the CPA industry. We found in 1999 that many CPAs want to get into the financial planning business; they want more than just to do your taxes,” Nazari says.
One of those CPA firms is Vavrinek, Trine, Day & Co. LLP (VTD), which bills itself as the 77th-largest accounting firm in the United States.
“We get our biggest face-to-face contact with our clients during tax season and a number of them saw MoneyFind on our Web site and commented on it. There are similar products out there, but this is by far the easiest to use,” says VTD senior partner Don Driftmier from his San Bernadino office.
VTD says it has had MoneyFind on its Web site since November for customers to use if they wish.
“For our regular tax clients in the era of refinancing loans, it takes all of two seconds to figure out what your payment would be with a new loan. If you decide you want to do it, you can go all the way to filling out an application online,” Driftmier says.
“There are a lot of things people can use the Internet for and this is probably one of the more practical ones.”