Consumer complaint received 2024-03-20
Product: Student loan — Private student loan
Issue: Dealing with your lender or servicer — Trouble with how payments are being handled
Company: TRANSWORLD SYSTEMS INC (VA)

Let 's go one problem per complaint to make it easier on UAS. 

I want to start by saying how I did not appreciate your last response. You made me feel that I was illiterate and not worthy of the degrees I have obtained. Both of my degrees are centered around math. Not to mention the fact that my mom is a compliance analyst for her financial institution and even she is appalled by what she sees. FYI, I have read my agreement and the back of my statements numerous times, which is why I have filed numerous complaints. I do my research as thoroughly as UAS allows me. I only ask a few questions so I can understand what you're trying to pull over on me.

First things first. You have repeatedly told me where in my agreement I can find the following statement : " All payments will be credited first to any other charges other than principal and FINANCE CHARGES, then to FINANCE CHARGES, and finally to the outstanding principal balance of my account. '' However, I do not think UAS fully understands what this means. My mom, who works in compliance at her financial institution, specifically told me that this statement from my agreement should be applied to every payment. Even the amortization schedule you uploaded shows that each payment first goes to interest and what is left of the payment goes towards the principal. This will lower my principal, lowering my interest and most likely have me paying the loan off within XXXX months. Even the back of my statement says : 1. Payments, including underpayments and overpayments, are applied first to any outstanding fees and/or late charges, then to any unpaid accrued interest, and then to the unpaid principal balance, and 2. Overpayments : Unless you notify us otherwise, in the event you pay more than the monthly amount due ( make an overpayment ), your payment ( s ) will be applied as Curtailment based on the credit terms. After looking at the FAQs on your website, Under the curtailment method, if you make any payment more than the monthly amount due ( overpayment ), amounts which exceed the monthly amount due will be applied to the most recent open statement period and will be allocated to reduce the outstanding principal balance if consistent with applicable regulations, promissory note, or loan agreements. Of my 5 payments, 4 of them are overpayments. My co-borrower and I specifically did this to see how UAS would handle it. 

Based on my agreement and the back of my statements, my payments should be applied as follows : Billing cycle : XX/XX/XXXX XX/XX/XXXX Payment XX/XX/XXXX {$1800.00} ( over ) interest {$1400.00} = {$350.00} applied to principal Billing cycle : XX/XX/XXXX XX/XX/XXXX Payment XX/XX/XXXX {$1800.00} ( over ) interest {$1400.00} = {$390.00} applied to principal Billing cycle : XX/XX/XXXX XX/XX/XXXX Payment XX/XX/XXXX {$1800.00} ( over ) interest {$1400.00} = {$340.00} applied to principal Billing cycle : XX/XX/XXXX XX/XX/XXXX Payment XX/XX/XXXX {$1800.00} ( min ) interest {$1400.00} = {$330.00} applied to principal Billing cycle : XX/XX/XXXX XX/XX/XXXX Payment XX/XX/XXXX {$1800.00} ( over ) interest {$1300.00} = {$430.00} applied to principal Assuming the minimum payment of {$1800.00} and APR do not change, at month XXXX I will still owe {$110000.00} in principal and I will still have a balance of {$35000.00}. My agreement with my lender, XXXX XXXX XXXX XXXX, with UAS as the servicer ends in 277 months ( est. 23 years ) ; I should not owe you anything if you are applying the payments correctly. 

This is common practice. Every loan I have, both private and federal, has EACH payment being applied to interest and principal. Even my agreement, the back of my statements, and the amortization schedule you sent me says/shows EACH payment will be applied to both interest and principal. I DO NOT understand why it is so hard for UAS to apply my payments correctly. And I have proof that I am not the only XXXX whose payments are not being applied correctly.