Consumer complaint received 2022-12-23
Product: Vehicle loan or lease — Loan
Issue: Managing the loan or lease — Problem with fees charged
Company: FIRST INTERSTATE BANCSYSTEM, INC. (SD)

First Interstate Bank ( " Lender '' ) approved the loan and disbursed the funds after viewing all application info and insurance cards, which were required to be submitted. 

A few months later, Lender sent letters via unregistered mail advising that updates needed to be made to the insurance deductible ( lowered from {$2000.00} to {$1000.00} ). 

Those letters were not received as our mail was on hold and we were out of town. No additional use of our contact information was made - Lender has both an email address and TWO phone numbers at which we can be reached. 

Instead of trying to actually reach us, or even trying to confirm in any way that we had received the letters, Lender very quietly added {$10000.00} to our loan on XX/XX/22. No notice was sent of this whatsoever. 

A month later, when one of our credit reporting systems picked up that our balance on the loan has INCREASED, we were very surprised to see that the XXXX $ XXXX had been added to our balance. 

We called the Lender and learned that this is an " insurance premium '' for insurance with the {$1000.00} deductible covering the life of the loan- but we have 67 out of 72 months left and we have already updated the deductible. 

We have now discovered that the payee for the insurance that we are paying $ XXXX for is the Lender, that they are charging us interest on the insurance premium they are charging almost 6 years in advance, and that THE LENDER EARNS A COMMISSION ON THE INSURANCE POLICY they scammed us into. 

I believe this is the definition of a racket. 

Furthermore, since the loan term did not change and the balance has increased, our loan payment has increased but we were never given notice of this, not even when we were on the phone with the lender discussing this very topic. Lende withheld material information that would certainly lead to us making an insufficient payment next month, leading to more fees and additional credit score impact. 

This is a very shady practice and I'm sure it makes First Interstate Bank a lot of money at the expense of well-menaing people everywhere who, like us, always pay their bills and choose to do the right thing whenever there is awareness. 

We've already updated our insurance. Lender has still not updated our payment amount so we don't even know how much to pay. Lender does not allow autopay or to may larger than usual payments without jumping through many hoops including waiting on hold on the phone for long periods of time. 

We now see that we have a loan with a shady scammer lender and will be refinancing as soon as possible, but our credit score has already been impacted by this and we face significant financial impact as a result of the additional > $ XXXX dollars added to our loan that we didn't budget for. 

First Interstate Bank is predatory and failed to inform us when they had the means- the intention was always to charge us this scam fee and earn their extra commission and interest. They had our phone numbers and email address. This is known because they used that contat information to confirm our identities when we called in to find out what was going on with this fee!