Consumer complaint received 2017-09-08
Company: WELLS FARGO & COMPANY
State: NJ
Product: Mortgage
Sub-product: Home equity loan or line of credit (HELOC)
Issue: Trouble during payment process

Complaint:
On or about XX/XX/XXXX I opened a Home Equity Line of Credit with Wachovia Bank which was subsequently taken over by Wells Fargo Bank. The HELOC was originally for {$250000.00} and later reduced to about {$180000.00} when I refinanced my original first mortgage.
The Line of Credit was an interest only loan and every month without fail I paid the interest that I was billed for. To my knowledge I WAS NEVER LATE ON A PAYMENT and was never charged a late fee. The monthly bills indicated that the balance shown was the entire balance including any unpaid interest ( which I assumed was only for the previous month. ) Please see the highlighted section of the attached typical bill. Please note the beginning and ending balances appear but NO ITEMIZED EXPLANATION as to how those figures are derived. lt was always my assumption therefore that when I paid the amount due on time I would billed for the same amount of interest the following month provided the rate did not change in which case the amount was either lower or higher.
I recently sold the home used for collateral and therefore asked for a " payoff '' amount. I was given the amount and now verbally told that it included " unpaid interest of {$2100.00}. '' I immediately asked for a detailed explanation since I was totally shocked at this revelation. The written answer I received, ( attached ) is totally unintelligible. The banker at the local bank where the loan originated could not explain the letter to me. Basically it merely is an accounting of how unpaid interest accrues but since I paid the total interest owed each month it makes no sense to me. It appears that the bank sometimes applied my payments to interest and sometimes THEY DID NOT, creating unpaid interest carrying over to the following month. The following month 's payment made on time and for the full amount billed was perhaps partially applied to interest but sometimes not at all creating even additional unpaid interest fees. AGAIN THERE WAS NEVER A DETAILED EXPLANATION PROVIDED. As an example please refer to the attached list of payments for XX/XX/XXXX It shows a Finance Charge of {$550.00}, a regular payment of {$800.00} and {$0.00} paid to interest. Further, refer to XX/XX/XXXX and XX/XX/XXXX Although I made regular payments they show none applied to interest My issue, REGARDLESS OF HOW THE BANK CALCULATES THE INTEREST, is that while allegedly unpaid interest was accruing I WAS NEVER INFORMED AND NEVER GIVEN AN OPPORTUNITY TO PAY. In my opinion this is an intentional hidden way for the bank to increase revenue without fully and honestly informing its customer. It is outrageous that a, till now, reputable bank can run up fees for a customer without his knowledge and get away with it. This has to be illegal! It appears to me that the millions of dollars in fines they have been assessed has merely served as a licensing fee to continue stealing from their customers.

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