Consumer complaint received 2018-01-18
Company: FIRST REPUBLIC BANK
State: NY
Product: Student loan
Sub-product: Private student loan
Issue: Dealing with your lender or servicer
Sub-issue: Received bad information about your loan

Complaint:
On XXXX XXXX, XXXX, I was approved for the student loan refinance program at First Republic Bank, which offers a relatively low interest rate to borrowers looking to refinance federal student loans. The loan amount was approximately {$120000.00}. 

On XXXX XXXX, XXXX, I submitted electronically a payoff form instructing First Republic to  process a payment to XXXX, the servicer of my existing student loan. On XXXX XXXX, XXXX, this payment was processed via check, and I began accruing interest on the XXXX XXXX student loan with a first payment date of XXXX XXXX, XXXX. 

On XXXX XXXX, XXXX, XXXX business days later, I noticed that the payment to XXXX had not been reflected in my account. I find this concerning and called XXXX to inquire. XXXX informed me that the payment was mailed to an incorrect payoff address and, while XXXX received the check in its possession, it was returning the check to First Republic and would not process the payment. 

I immediately alerted First Republic of this issue and asked to get the issue resolved as soon as possible, in part because I was now accruing interest on both the XXXX student loan and the First Republic loan. I was assured by First Republic that they would " take care of me '' and would " make me whole '' by reimbursing me for the extra interest that I would now accrue. However, First Republic would not issue a new check to XXXX until the previous check was received by them. 

On XXXX XXXX, XXXX, after not hearing anything from First Republic, I followed up to inquire about the status of the check and learned that First Republic had not sent out a new check. To their credit, after I contacted them, a new check was issued the next day and sent to the correct payoff address. I nevertheless wondered how long I would have had to wait before the bank contacted me to issue a new check ( had I not contacted them ). I suppose it was n't of great concern to them now that I was accruing interest on the loan with them. 

After the new check had been mailed, I then asked First Republic to settle the " double interest '' that had accrued as a result of this hiccup. The double interest came out to approximately {$660.00}. After a somewhat contentious back and forth, including First Republic blaming me, the borrower, for providing them with an incorrect payoff address for XXXX - something I continue to dispute - First Republic finally agreed to give me a {$500.00} credit which they described as a " courtesy '' and a showing of " good faith. '' While I let them know this was appreciated, I again reminded First Republic of the assurances I had received from them that I would be made whole and reimbursed for the double interest that accrued. The bank 's only response was to cite certain boilerplate in the payoff form describing a certification as to the accuracy of the information provided - in other words, they were throwing the book at me and were not willing to reimburse the last {$160.00} or so. 

In summary, there are two points that I believe prospective consumers should be aware of when considering a student loan refinance with First Republic : 1. Be cautious of any assurances you receive from the bank. They may not necessarily make good on everything they promise, and it is probably best to get everything in writing to the extent possible.

2. Ensure that you provide them with precise, correct information, particularly with respect to the payoff information. While I would argue that the bank has a duty and is in the best position to ensure that loan payoff information is correct before issuing a check, the bank does not seem to agree and instead holds borrowers strictly liable for any mistakes. They also do not seem to do any diligence prior to issuing a check, even ones for over {$100000.00}.

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