Consumer complaint received 2025-09-10 00:00:00
Product: Vehicle loan or lease — Loan
Issue: Struggling to pay your loan — Denied request to lower payments
Company: NAVY FEDERAL CREDIT UNION
State: TX

Complaint narrative:
Dear CFPB, I am writing to formally file a complaint regarding the treatment I have received from Navy Federal Credit Union concerning late payments, hardship assistance, and account management, which I believe constitutes negligence and discrimination. 

Since becoming a member in XXXX, I have faced significant hardship due to a medical condition that temporarily prevented me from working. Despite being eligible for hardship programs, Navy Federal repeatedly denied my requests for assistance, specifically for skip-a-payment options. Each time I contacted the bank, I was misinformed about my eligibility. Initially, I was told I would be eligible for a skip-a-payment in XX/XX/XXXX, then advised to wait until XX/XX/XXXX, and finally told I could not qualify because I was not earning income at the timedespite the fact that financial hardship itself should qualify as a valid reason.

This inconsistent communication and denial caused my accounts to be closed and resulted in over 18 late payments reported on my credit report. I believe Navy Federals handling of my situation was negligent, especially given that hardship due to financial inability should be recognized as a valid reason for deferments or skip payments. The banks actions seem discriminatory, and there are publicly known allegations and ongoing lawsuits against Navy Federal for discriminatory practices, including denying loans to African-Americans.

Furthermore, Navy Federal offered to refinance my auto loan in XX/XX/XXXX, but I was led to believe it was a standard refinance. It turned out to be a collateral refinance, which prevents me from refinancing with another institution. Since purchasing the vehicle in XX/XX/XXXX, it has always been reported as a loan rather than an auto loan, which is inaccurate. They also never requested documentation to verify my hardship, and I believe if they had, my vehicle would not have been reprocessed under these terms. 

Despite being a member for over two years, I was only offered a single skip-a-payment option in XXXX, which I successfully used. I also understand that Navy Federal offers an automatic deferment once a year, yet I was required to undergo an assessment to XXXX unnecessary process compared to other federal credit unions I have dealt with. Additionally, Navy Federal claims to work with outside nonprofit organizations, yet none were offered or suggested to me when I was denied assistance. Mind you whenever I begin to fall behind and ask for a skip-a-payment I always set a payment arraignmets with the collections dept. on when they can expect the remainder of my auto loan payment. 

The ability to skip payments was crucial for me, especially in XXXX, as it would have provided me with the financial relief needed to manage my health and expenses. The repeated denial and poor communication have caused significant damage to my credit standing, with accounts closed and late payments reported unfairly. 

Navy Federal reports my payments as late if made three days after the due date, despite offering a 10-day grace period for auto loans. This misreporting unfairly damages my credit score. * The 10-day grace period allows me extra time to make a payment after the due date ( for example, if my payment is due on the XXXX, do I have until the XXXX of the next month to pay without penalty? ). 

* The grace period applies only to late fees or is it also related to when my payment is reported to credit bureaus. 
* The grace period is guaranteed or contractual, as NFCU has not included any language regarding this in their loan contracts. This lack of clarity could lead to late payments being reported or fees being charged prematurely, which could harm consumers. 

My concern is that without explicit, written disclosure of the specifics of the grace period, customers like myself are left uncertain about their payment obligations, which could inadvertently lead to late payments or damage to credit reports.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation