Consumer complaint received 2017-07-27
Company: WELLS FARGO & COMPANY
State: NY
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 am filing a complaint regarding Wells Fargo ( WF ) and XXXX XXXX XXXX ( XXXX ). Both lenders appear to engage in unethical practices regarding the handling of student loan refinance. They seem to do in an attempt to collect additional interest from the borrower. I refinanced my WF student loan with XXXX ( at the time managed by XXXX but has since changed to XXXX XXXX ). I applied for the loan with XXXX in the XX/XX/XXXX timeframe, and the loan was finally " dispersed '' by XXXX on XX/XX/XXXX. The payoff was not processed by WF until XX/XX/XXXX. Below, please find my grievance with supporting narrative regarding the manner in which both lenders have engaged business with me : WF and XXXX have procedures that require the borrower to pay duplicative interest. XXXX begins charging interest on a loan based on the date of dispursement. This date of dispersement ( i.e., the date the check is purportedly written and sent ) can not be verified by the borrower. However, the borrower is required to pay interest to XXXX beginning on that date. The date the monies are actually received by WF in the mail is also not able to be verified by the borrower, and the borrower must continue to pay interest to WF for as long as it takes for WF to process the payoff after receiving in the mail. The borrower is completely blinded to the process, and this allows lenders to take excessive time to process payments in order to collect on additional interest. Narrative : I observed via my online account, that XXXX began charging me interest based on the dispersement date of XX/XX/XXXX. At the end of XX/XX/XXXX, still no payment had been received by WF ( confirmed by WF online account management and WF representative via phone ). I spoke with XXXX representative on the phone, who stated it might take a up to week for WF to receive the check due to the fact that it had to be MAILED to WF. I was shocked to learn that banks are still sending PAPER CHECKS to one another, which takes significantly longer than electronic transfers. Neither XXXX nor WF have any difficulty receiving real-time electronic payments from consumers such as myself, but apparently can not do the same between themselves. I emailed XX/XX/XXXX requesting explanation as to why they begin charging me interest on the date the check was WRITTEN ( XX/XX/XXXX ) instead of the date it is " cashed '' by the other bank, given that there is an obvious time lag due to their method of MAILING a check and allowing the receiving bank to process the payment at their leisure. The exact response I got was : " Please allow 10 business days for the previous lender to receive the payment for payoff. '' Of course, during this time ( duration of 16 days ) BOTH lenders were charging me interest on essentially the same loan. I expressed to a XX/XX/XXXX customer service representative via telephone that I felt it was unfair to charge me interest based on the date of dispersement, which resulted in me paying 16 more days of interest at a cost of somewhere around $ 15-25 per day, all the while paying interest daily to WF as well ( amount not calculated here ). I expressed the same to WF, whose customer service resorted to obfuscation and meaningless scripted responses. No one could explain to me the exact interest charges or why it took so long to process the payoff check that was supposedly mailed on XX/XX/XXXX ( I, of course, have NO way of verifying this date that XXXX asserts they mailed the check, nor can I verify the date of receipt at WF ). I called both banks multiple times, each time the customer service representatives would assure me that they would look into it and promised to call me back. I did not receive follow up calls as promised. I did, at least, receive a printed payoff summary from WF in the mail after a particularly exasperating and lengthy discussion with a WF supervisor who I informed that I would be filing a complaint. I find it highly suspicious that my payoff payment processed at WF on the SAME day that my usual WF monthly payment is processed ( the XXXX of every month ). It is almost as if WF waited to process the payment in order to be able to collect on the full month 's interest. *An ancillary matter is that WF immediately terminated online access to my accounts when the loan was paid off. Consequently, I could no longer track or verify any of my account information, and was forced to rely solely on whatever the WF representative told me on the phone. Disturbingly, the information regarding account balances, etc. that was given to me by the representatives would change over the course of even just one discussion. When asked about the obvious inconsistencies, the representative was unable to give a satisfactory answer and then would put me on hold long periods of time. I even spoke with a supervisor, but she continued to give me the same lines. They could offer no explanation as to why WF shuts off access to borrower accounts when they are paid off. Of note, I paid off a different, individual, WF student loan at an earlier date, and I continued to have access to information regarding that loan until the time of this payoff. It is unknown to me why I was allowed to have continued access to that loan account, but not the others. Lastly, because the payoff did not process at WF until XX/XX/XXXX, I still had to pay the usual monthly payment to WF ( which was scheduled for XX/XX/XXXX ). My first XXXX payment was due XX/XX/XXXX. So, I ended up paying BOTH lenders for the same loan within the same month. In effect, this DOUBLED the amount that I would ordinarily expect to pay in one month. Fortunately, I was able to manage to make both payments. Nonetheless, I find it exceedingly irritating that I refinanced my loan under the pretext of saving money, and ended up having to make double payments in one month and pay double interest. In conclusion, despite having been a borrower who has never missed a payment or paid late, I was subjected to excessive interest payments and financial hardship due to the potentially duplicitous practices of the lenders.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation