Consumer complaint received 2019-12-02
Company: Flagstar Bank, N.A.
State: OH
Product: Payday loan, title loan, or personal loan
Sub-product: Installment loan
Issue: Problem when making payments

Complaint:
On XX/XX/XXXX made a principle only payment of {$690.00}. This same loan was to automatically withdrawal the standard monthly payment on XX/XX/XXXX from my checking account. The payment from XXXX was credited as a normal payment and no payment was withdrawn from my checking. I contacted the branch where I made the payment on XX/XX/XXXX and they said they misapplied it and would correct it to a principle payment and that I then needed to call the loan center to have the normal payment that was never withdrawn applied to the loan. On XX/XX/XXXX, my girlfriend called the 800 # for the loan center, as I requested she be added as a contact to get full information and be able to deal with concerns on this loan because of my work schedule. She was treated poorly by the rep answering, told that her permission was no longer valid. She asked if the rep would contact me for permission to speak with her. The rep told my girlfriend that the rep doesnt initiate the call, my girlfriend would need to do a 3-way call. My girlfriend called and put the three of us on the line together. The rep did not verify who I was, just asked if she had permission to speak to my girlfriend. I said yes and the rep said I could gang up. If the permission on file was not valid as the rep stated, then the bank should contact me at the contact information they have on file, not require my girlfriend to initiate a 3-way call, as she could have called anyone. At the very least the rep should have required some kind of verifying information from me to prove who I was. This seemed to be done as more of a hassle than for my security, since I feel even less secure with my finances information at that bank after this instance. After additional poor treatment from the rep, my girlfriend asked for a supervisor and spoke to XXXX. He said he could do nothing to correct the payments, could direct her to no one who could. His only solution was he would date the most recent payment as a principle only payment, but then the loan would be a month past due, causing a late mark on the credit bureau. As this has never been late and never should be late with direct withdrawal payments, my girlfriend said that was an unacceptable solution and when she asked for his supervisor, he told her to wait, then put her back into the original call que to start the process again from the very beginning. After this hassle and round of going nowhere, we then contacted a member of management from the branch network on XX/XX/XXXX and was told it would be corrected. XXXX, XXXX and XXXX payments did not withdraw full payment amounts due to misapplied principle only payments either, but due to the time elapsed, I only asked that XXXX be corrected and dated to the date it should have withdrawn. Checked with the manager again on XX/XX/XXXX and was told he thought it was corrected and it would be escalated to the regional manager on XX/XX/XXXX. After no response, contacted another branch manager on XX/XX/XXXX to assist. During this delay, the money continues to sit in my account to be applied for the proper dates. I sent another principle only payment for XXXX and once again, the full XXXX payment did not withdrawal because the additional payment mailed was not applied as principle only. I have asked that this be corrected and the payment be withdrawn as it should be every month. This loan was taken out with XXXX XXXX XXXX  and I had no issues making additional principle payments and my normal monthly payment would withdraw from my checking. I signed an agreement for those withdraws to consistently withdraw every month. The Electronic Fund Transfer Act says Ill be notified of a variance in withdrawal amounts, which Im not, and there shouldnt be a variance. Im now told ( On XX/XX/XXXX ) I can only make principle only payments during a small window of the XX/XX/XXXX-XX/XX/XXXXof the month because of the system utilized by Flagstar Bank who assumed the loan in a divestiture XX/XX/XXXX. The loan has not been correct since that time, when a ticket was opened for a payment never being withdrawn. It was escalated but never followed up on. As of now, I have more than two payments sitting in my checking that the bank has not withdrawn to apply to the loan and I pay interest on the loan based on this higher amount every day. The bank is basically collecting interest that they do not deserve because they have a system that is not capable of doing what the initial bank was capable of and in accordance to my signed contracts. As of today, XX/XX/XXXX, I have not been able to get these funds dated for the dates they should have been applied or even withdrawn from my checking. Nor am I getting any follow up from the bank. The closest branch is over an hour a way from where I live and I should not have to make repeated trips to the branch. I can not even get online access to my loan without going to a branch for setup, so I have to wait for monthly statements to be mailed to see how any payments are getting applied and find the errors. Until it is all corrected, I can not get an accurate payoff amount so I can close out this loan, which is also causing me to pay additional interest for all the wait time in getting this corrected. I asked for the payoff with correcting the payments on XX/XX/XXXX when I contacted the second member of management. This is an unfair practice, to drag out correcting misapplied payments causing delays in getting an accurate payoff and collecting additional interest with every day of delay.

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