Consumer complaint received 2023-10-04
Company: Cottonwood Financial Ltd.
State: ID
Product: Payday loan, title loan, personal loan, or advance loan
Sub-product: Installment loan
Issue: Problem when making payments

Complaint:
In XXXX XXXX I received an email addressed to me directly stating " You have been pre-qualified to receive {$1900.00}. '' The amount quoted would have greatly benefitted my financial needs. Therefore, on XXXX XXXX XXXX I went into the Cash Store located aXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX and applied for the loan. However, the senior customer service representative XXXX informed that I only qualified for {$420.00}. I accepted the {$420.00} loan XXXX XXXX, with monthly payments of {$140.00}. I paid the Cash Store {$140.00} for XXXX and XXXX, but I was struggling to maintain payments since the cost of living has risen considerably higher. 

On XX/XX/2023, I requested to refinance the loan. XXXX informed that I could refinance the loan and the monthly payments would be the same. After refinancing with the Cash Store, I received {$120.00} from the refinance and a new loan XXXX  XXXX. But after signing the refinanced loan documents, XXXX told me my monthly payments are increased to {$150.00}, even though she previously mentioned the payments would stay the same. 

I have continued to pay the Cash Store monthly payments of {$150.00} since XX/XX/2023, even though the increase has caused me further difficulty in maintaining necessities of life in this economy. But in late XXXX or early XX/XX/2023, I called XXXX and asked her about the extremely high interest rates and why I am being charged XXXX percent APR, which was an increased from the original XXXX percent APR. XXXX 's explanation did not change or resolve the high interest charges, even though XXXX realized from my conversation that I was having financial difficulty. 

On XX/XX/2023, I called the Cash Store and asked how much the payoff balance would be for the loan. I was told the balance was {$270.00}, but would increase on XX/XX/, to {$270.00}. Although {$270.00} seems like a small amount of money, it is a lot when other bills, food, and personal items are required from my monthly funds. Several minutes after ending the phone conversation, I called again and asked if I would pay the balance of the loan in full would I be able to obtain a loan for a higher amount and lower interest rate. I was told no ; the loan amount and interest would stay the same. 

On XX/XX/2023, XXXX called as she usually does and asked me if I was ready to pay the monthly Cash Store payment. I told her I would call back. XXXX said the Cash Store will be open until XXXX XXXX. I didn't call back on XX/XX/XXXX. In my regular conversations with XXXX on the XXXX of each month, she would record the conversation and asked me to confirm authorization for the Cash Store to take money from my bank account. I would verbally authorize each payment. 

However, on XX/XX/2023, I called the financial institution that I bank with and inquired about the amount in my bank account. When I questioned the available amount, I was told the Cash Store had already taken payment from my account. I did not confirm authorization or given consent to the Cash Store to withdraw funds from my bank account. Although I have paid the Cash Store regularly each month, it has been a struggle, and I knew the funds in my bank account for the month of XXXX would not fulfill all my obligations appropriately without over drafting my account. This is the reason I called the Cash Store on XX/XX/XXXX, to find out if I could refinance the loan.

Company response to consumer: Closed with explanation