Consumer complaint received 2023-09-26
Product: Payday loan, title loan, personal loan, or advance loan — Personal line of credit
Issue: Charged fees or interest you didn't expect — 
Company: SoLo Funds Inc. (GA)

I took a loan from Solo Funds on XX/XX/XXXX for {$450.00} with a payback date of XX/XX/XXXX. Solo operates based on a social credit scoring system where if you consistently receive and pay back loans in a timely manner your credit worthiness score will go up and your loan limit amount increases. Solo purports to have thousands users both funding and taking loans in a marketplace where lenders can choose among borrowers with different worthiness scores also being incentivized by lender tips an amount on top of the principle amount borrowed given to lenders and can be adjusted based on what can only be your level of desperation to be funded. My score was high as I always repaid loans in a timely manner and had a high borrowing limit. Unfortunately I had to leave my restaurant leaving me with XXXX a month less in income to meet rent, bills and other obligations. Unfortunately I missed my scheduled repayment and defaulted on this loan a I was receiving emails frequently from Solo threatening that my account would go into collections and I would be charged a synapse processing fee, also a late fee. At a point I received what I thought was a final email from Solo in XXXX saying that if payment was not made the account would go into collections and potentially reflect negatively on my credit. At this point with no money to pay Solo I was relieved that attempts at collecting this debt would stop and if moved into collections I can claim hardship, try to restructure and work out a payment plan to settle the debt. Solo doesnt transparently advertise the average interest rates on loans received by users because ultimately they are quite high and comparable to a traditional payday loan business. The lender tip which Solo claims goes to lenders, is on top of a mandatory tip to Solo for I guess arranging the loan. At some point in my time using this app Solo introduced a wallet feature where funds requested would divert to an in-app wallet that would allow you to cash out to your account which would previously be accomplished by a check card credit from Solo direct to your checking account. In order to cash out from solo wallet there is a processing fee, which didnt exists when I started using the app on top of Solos mandatory tip and the lender tip. I am of the opinion that Solo is ultimately behind funding these loans in the marketplace where users with higher credit worthiness are likely to be funded with lower proposed lender tips and users with higher credit worthiness are likely to be funded with lower lender tips. Once all the fees come together on top of your borrowed principle you realize the functionality of the app is just a psychological massage that gets you to accept and justify agreeing to high fees. I would not be surprised if many of the lending accounts associated with Solo are not real and accounts controlled by Solo purporting as end user marketplace lenders. Beyond this my primary complaint is that when I received a check deposit from my parents to cover my monthly expenses for XXXX dollars I checked my account to notice that Solo had check card drafted the loan repayment in full on top of fees from my account leaving me with XXXX dollars. An account that had not been settled to do hardship had now been drafted from my account in full because my balance exceeding a certain amount and Solo being predatory is using APIs to query users checking account balances for opportune times at repayment attempts. Even while receiving correspondence that my account was going into collections Solo was still authorized to draft my account for a repayment on top of late fees on top of already exorbitant interest masked as tips. This feels very predatory- not being able to afford repayment is not the same as no money ever being in your checking account people have essential obligations and bills that must be met regardless of their standing with outstanding loans or lines of credit. If credit card companies could draft peoples checking on file for past due debts many people would not pay their bills and feed their kids. Luckily I am young I am a student with supportive parents and good friends and most of my obligations are met but I can imagine for a parent or someone with obligations beyond themselves that this could be very well devastating and leave folks in a very desperate state. The emails I received suggested that I open the app go in and make repayment not that multiple attempts at repayment would continue informed by queries on your checking balance. Whether or not these actions are allowed in the terms of service agreement are beyond me but it feels predatory and opportunistic. You do not draft 90 % of someones checking balance for missing a scheduled loan repayment after threatened that the account is in collections. I know this has probably happened to others who might not have the time to make a formal complaint but I do and my aims are not selfish.