On Aug. 1, 2013, $864.74 was added to my loan, and I was told to me when I call that it was due to no proof of insurance being listed under Advancial. My insurance sent me verification that this had been sent to them months prior. I was refunded on the 9th of August, but in the amount of $541.16.
On Aug. 8, 2013, I receive a letter in the mail stating that I am due $1092.48, and that my loan has a monthly payment of $785.22. The terms of my loan are $414/mo. for 72 months. This letter continues onward with a "formal demand upon you to pay the sum of $1877.70 on or before 5:00 p.m. on 8/18/13." First I am not due $1092.48, as my account can verify. Second, for me to be due $1877.70 by 8/18/2013, I would be required to pay $785.22, which is not a stipulation of my loan contract. In between this all, I have received phone calls stating that I owe in these amounts which are both incorrect.
In summary: Complaint 1: $864.74 added to my loan, only $541.16 reimbursed
Complaint 2: There are apparent errors on their part, that has me listed as paying $785.22/mo instead of the $414/mo original listed. This is a loan of 11.21% interest, they are getting more than their lions share. If I must, I will go elsewhere, and for lower interest, since I am able to credit-wise.
Correct errors on your end, and quit with the phone calls and "formal demands" for that which I do not owe.
Business' Initial Response
We are in receipt of the complaint submitted by M *******. There were two points of concern indicated. Please accept the following paraphrase of the complaints and our associated information related to these concerns.
Complaint # 1 - $864.74 was added to my loan, only $541.16 reimbursed.
As of this date a full refund including interest and late fees has been applied to Ms. *******'s loan. The refund was posted in two separate transactions. The amount added to the loan represented premium for collateral protection insurance (CPI). The amount was posted to the loan on 08/01/13. Credit union procedure is to mail three letters to the member requesting proper insurance information prior to any CPI premium being added. A fourth letter with the CPI policy is then mailed. In this case, proof of insurance was provided but Ms. ******* was not listed as an owner of the policy or as a named driver. The policy was in another person's name who is not a party to the loan. In addition, the credit union requires a deductible of $1,000.00 or less. The deductible on the initial proof of coverage provided was $2,000.00. Subsequent proof of coverage was received with deductibles of $1,000.00. The credit union made an exception to policy by allowing the coverage to be carried in a non-borrowers name. Hence the two separate refund postings. To reiterate, a full refund plus interest and late fees has been applied to the loan.
Complaint #2 - There are apparent errors on their part that has me listed as paying $785.22/mo instead of the $414/mo originally listed.
When CPI is added to a loan, the member's monthly payment is increased to offset the additional premium added. In tandem with the CPI refund, the loan payment has been adjusted back to the original contracted amount.
Consumer's desired resolution - Correct errors on your end, and quit with the phone calls and "formal demands for which I do not owe.
As stated above, a full refund has been applied to the loan and the monthly payment amount has been adjusted based on the subsequent insurance documentation received. The CPI premium and increased payment amount were triggered by the insufficient original proof of coverage documentation and associated data the credit union received from the member's insurance carrier. There were no errors on the part of the credit union in this matter.
It is the credit union's standard policy to send letters to members that are past due on their loan. The amounts shown on the letter included the addition of the CPI. However, the status of the due date at the time of the letter was not related to the CPI. There are notes on the account from our Asset Management Department concerning contact with Ms. ******* dating back to January 2013.