I had a nervous breakdown a few years back, lost everything, home, job, marriage. I owed citifinancial. I had disability insurance. It didn't pay off my debt because citifinancial had reduced my payments to help me out.

I finally got to a point I could make small payments $165.00 a month. Over the course of two months I called them three times (no I don't know whom I spoke with, I didn't write it down {Huge mistake, }). I was told each time, that the balance was what I owed. I asked if there were any other charges. They said no.

The first month I made my payment over the Internet and my balance dropped $165.00. I made my third payment and got my statement in the mail the same day. Imagine my surprise to learn my balance was the same as the month before, the payment had been put on interest. I got on the Internet and learned that my entire payment I'd just made went on interest.

I quit paying after calling to find out that I was "stupid" (there words not mine) for not getting this in writing and knowing all banks charge interest. I was also told that my interest was 165.00 a month.

Yesterday I tried to get what I thought was a misunderstanding taken care of. I spoke to a Brian Johnson. On top of the two interest payments they've already taken, there charging me $489.00 plus the $50.00 they sucked out of me yesterday for defered interest. There also charging interest daily, I now have a payment of 175.00 a month and they can't tell me what the rate of interest is that I'm being charged, just that it's less than 29%.

My advice if you've hit hard times in the past and owe them money, don't try to make it right buy calling and setting up payment arrangements, unless you'd like to pay an additional 869.00 on $2800.00

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6 Updates & Rebuttals

Sea

Clarendon,
Pennsylvania,
United States of America

Magically appering

#2Author of original report

Thu, October 14, 2010

Sorry for the attitude, and taking my frustration out on you when you're just trying to help. I don't understand there paperwork. Starting 06-10-2004 the disability insurance kicked in. Every disability payment 100% of the payment was taken off the balance. I started paying again 03-03-2010. I asked what the payoff was and was told it was the balance because all the intrest had been calculated. I still don't know why this happened, guess the whole things just making me a little nuts, but thanks for trying to help.

Dave

USA

Just a learning tool

#3Consumer Comment

Thu, October 14, 2010

Sure perhaps I do sound like those you talked to on the phone but that's the way loans and interest work. I didn't intend to sound like I was defending the lender but was giving information on how interest is calculated on loans so you or anyone else can calculate interest for themselves.

If you and Citifinancial agreed to a loan modification changing it to zero percent interest then I suggest you find all of your documentation to prove to them that they are charging you interest when they should not be.

If they are charging you interest and shouldn't be then I would demand they credit your account the amount they took for "interest" or at the least provide you with a refund check.

Having said all that I'd bet when you read your agreement/contract somewhere in the paragraphs you'll find something about interest charges no matter what the guy on the phone told you.

Sea

Clarendon,
Pennsylvania,
United States of America

Magically appearing

#4Author of original report

Wed, October 13, 2010

You sound like the people I spoke to on the phone. There really is no need to know what your formula is for calculating intrest when I was told there were no charges beyond the principle. Intrest is a charge beyond the principal. No charges= No intrest, pretty simple formula,= 0. My monthly paperwork does not list an amount for intrest. My payment just started showing up under the intrest row of my statement. Nothing had been entered there in four years- nice try, wanna go again?

Dave

USA

Loans and Interest

#5Consumer Comment

Thu, October 07, 2010

In just about every loan the payment made is applied in the following way:

Interest, fees, and then principal.

as for daily interest this is not a rip off what happens is your yearly interest rate is divided into a daily interest rate so if paying off a loan early you will only pay interest for the amount of time the loan is actually open. This is why when asking for a loan pay off a 10 day payoff is generally given to allow mail time for the final payment to be received.

to calculate daily interest on your loan use the following formula

principal X Interest % / 360

2800 X .2652 / 360 = 2.06 per day in interest ($61.88 interest for the first 30 days)

for the following month if using a $175.00 payment (2800-113.12=2686.88)

2686.88 X .2652 / 360 = 1.98 interest per day. so if I were to ask for a 10 day pay off the pay off amount would be 2706.68. If they were to get my payment in 5 days they would owe a refund of $9.90

Now if a reduced payment is not enough to fully cover the interest or fees the remaining balance is added to the outstanding balance of the loan which interest is charged to.

To reduce the amount of interest you will pay send a little extra every month or if possible instead of making 1 monthly payment split the payment and make it bi weekly.

Sea

Clarendon,
Pennsylvania,
United States of America

citifinancial Magically appearing deffered intrest Hermitage,PA

#6Author of original report

Wed, October 06, 2010

found out intrest is 26.52%, .90 cents a day. Also I will be charged intrest every day until loan is paid off.

Bman

Philadelphia,
Pennsylvania,
United States of America

Please File A Report....

#7Consumer Comment

Fri, September 24, 2010

This kind of banking scam needs to stop. Have you seen how many people are being scammed and money extorted from them by the corporations that we had once been able to trust? There is a new regulatory agency being created so the more reports about the abuses and USURY would support the anger that most people have towards banks. We get them out of trouble and look what they are doing to us. Sure they need to make a profit, yet they also need to provide a decent service to their customers. I would suggest writing this complaint into a report and sending it to this agency:

http://www.ftc.gov/reports/index.htm

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