Consumer complaint received 2022-03-16
Company: GreenSky, LLC
State: AK
Product: Payday loan, title loan, or personal loan
Sub-product: Personal line of credit
Issue: Charged fees or interest you didn't expect

Complaint:
I am being charged interest on the original amount of my loan, even though the balance has been declining for months. Here are the details : the company " XXXX by XXXX '' sells windows and uses " Green Sky LLC '' to provide interest-deferred loans that are interest-free if paid off by the end of a promotional period ( otherwise, in my case, it's a 24.99 % rate ). The promotional period for my loan through this process ( to purchase new windows for my home ) was 2 years. While monthly payments are recommended, none are required. For several months I didn't make any payments, but eventually I did. My original high balance was {$12000.00}, and the first month ( XX/XX/2021 ) it reached this balance my account was charged {$250.00} in deferred interest. Fast-forward to my XXXX statement : my unpaid balance is now down to {$11000.00}, and the deferred interest charge added is ... {$250.00}. Green Sky has been charging me that amount on every single statement, even as the unpaid balance has diminished. I called Green Sky customer service to point this out. I was told that that's just the deferred interest for my loan, and also that it wouldn't matter unless I went past my promotional time period and had not paid off the loan. The actual contract has 2 items that indicate charging interest on the original loan amount regardless of the unpaid balance amount is wrong. The first is this ( from a Q & A section ) : '' ... it is a good idea to make regular payments to minimize any deferred interest you might owe if the purchase balance is not paid in full before the end of the promotional period. '' The second is an element of the contract itself : " For value received, you agree to pay us : ( a ) so much as you may actually borrow from time to time by initiating transactions under the Loan Agreement, plus ( b ) periodic interest at an annual rate of 24.99 % on the unpaid Amount Financed outstanding '', and " We calculate the interest charge on your account by applying a monthly periodic rate to your outstanding principal balance on the first day of your first billing cycle and thereafter to your outstanding principal balance on the first day of each billing cycle. '' The operant wording indicates " unpaid balance '' or " outstanding principal balance '' is the amount interest is to be calculated on, and even the Q & A statement indicates a lower balance will result in lower interest owed. In Green Sky 's actual practice, you are charged interest on the original loan amount for the entire length of the loan, regardless of remaining balance. My balance of {$12000.00} was charged {$250.00}, and months later, my lower balance of {$11000.00} was charged the exact same amount of interest, {$250.00}. Directly complaining and explaining this to customer service resulted in no change or acknowledgement that anything was being done incorrectly, even though it's an obvious contract violation and morally ( and no doubt legally ) fraudulent.

Company response to consumer: Closed with explanation