Consumer complaint received 2019-04-11
Company: DISCOVER BANK
State: WY
Product: Student loan
Sub-product: Private student loan
Issue: Dealing with your lender or servicer
Sub-issue: Trouble with how payments are being handled

Complaint:
I received a letter in early XX/XX/XXXXfrom Discover saying they had recalculated my loan terms. Before this letter, on loan ending in XXXX, I had 118 months of payments left, and the monthly payment amount was {$140.00}. With no prompting or reason whatsoever, Discover changed my repayment term on this loan to 22 months, increasing my monthly payment to {$650.00}. Additionally, Discover increased my interest rates on all of my loans ( from 4.5 % on two of them to 4.75 % and from 4.0 % on the other two to 4.25 % ). I have never been a single day late on a payment and did not request that any changes be made to my account. This letter came out of nowhere. I called Discover on XX/XX/XXXX, and was placed on hold for a total of about 25 minutes while the agent claimed she was trying to figure out what happened. Ultimately, she said she would call me back. She called back later and left a voicemail which I returned immediately, only to be unable to reach the original agent. I was again placed on hold for a total of about 20-25 minutes, and the agent ultimately told me the problem had to be sent to " another department '' and said she would call me back XX/XX/XXXX at around XXXX MST. She never called me back. 

I also sent a message through my secure messaging center with Discover, only to receive a non-response which basically cut and pasted what was written in the letter which increased my monthly payment on loan XXXX from {$140.00} per month to {$650.00} per month, and increased all of my interest rates. My master promissory note ties my interest rates to the prime rate, and the prime rate has not changed since XX/XX/XXXX. After the XX/XX/XXXX rate change, Discover promptly increased my interest rates on my accounts, so the XX/XX/XXXX rate change was already reflected in my account when they again increased my interest rates in XX/XX/XXXX. I asked Discover why my interest rates were changed and they claimed it was because of a change in the prime index rate effective XX/XX/XXXX. There was no change in the index rate in XX/XX/XXXX. Their statement that the prime rate increased was a flat lie. 

Additionally, last summer, I accidentally made two payments instead of one, and asked for a refund of one payment. Discover misallocated the payment they did not reverse, and it took 3 months for Discover to fix the problem -- and they never reverted my interest rates to the original rate. I believe they did not apply as much as they should have to principal over that time frame, collected too much in interest, and increased my interest rates in violation of the master promissory note. 

My account has always been kept in good standing, and I did not request or otherwise do anything that should have prompted a change in my repayment term or an increase in the interest rates on my loans. I believe Discover has engaged in fraudulent activity on my account in an attempt to collect more money than is due in interest charges, and to collect far more than is presently due by accelerating the repayment term in violation of the master promissory note.

Company response to consumer: Closed with non-monetary relief