• Report: #239929
Complaint Review:


  • Submitted: Tue, March 20, 2007
  • Updated: Wed, March 21, 2007

  • Reported By:PLANTATION Florida


*Author of original report: Thanks for your explanation

*Consumer Suggestion: Learn more about simple interest

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I acquired a refi loan with this company in 12/05, Since then I have been laid off, and my husband retired from the Army, and with this retirement came a lot of adjustments including taking over four months to find a job that would pay for our bills. Even through all this I was able to make partial or full payments. As of right now I am current. My prepayment penalty expired and I am looking into refinancing my loan, but to my surprise when I called to find out information about my account balance they told me that I had accrued over $14,000 on deferred interest. When I asked how this had happened and why, they told me because of the time I had been late in the past and because if I don't pay the loan on the 30th instead of the 2nd, I will incurred on these charges. I also find out that my credit score has been damage because they report you late if you don't pay on the due date.

During the times that I went to the local branch to discuss with them my options when I had problems back at the beginning of 12/05 and again the middle of 2006 a lady by the name of Tara told me that as long as I made my payment within the grace period I would have no problem. I now find out that they start charging compound interest on my payments as soon as I miss a day. Is this legal? I thought you have up to 10-15 days to make your payment and that point then you will be charge a 5% fee one time. These people are not following this rule.

I checked my contract and states that I have 10 days and then they will charge the 5%, there's no mention of any deferred interest. I called and asked for a copy of the payments on the account and they are amount they charge for deferred interest has not consistency, and they are not applying any money I send to the principal. If I pay by the 30th then they apply to the principal, if I pay by the 1st then they apply every single dollar I send to the interest. Is this legal???? Please help!!! I need to know what are my rights and if this people are in their right to still my money this way!!!!

I will appreciate any advice you can provide for me. I have read some of the report on this website and I am totally shock. Please if anyone would like to contact me my email: (((ROR REDACTED E-MAIL ADDRESS FOR SECURITY PURPOSES))), we need to stop this, and politicians need to think about the people that put them in office!!!! Not the companies that pay their way!!! I also already file a complaint with Attorney General in FL, not sure if that is of any help waiting for their response.

PS: for those of you that read this reports and think that people are just using the system to get away with their payments, I am here to tell you THAT'S NOT ME!!! I am a hard working individual and so is my husband, he served in the military for 20 years and when he came out he was not able to find employment ( a decent one that is), it took him a long time to get one that will pay enough. There might be people out there that might abuse the system, but there is a lot of other people that encounter situations that pushes them to try to survive, and some are not able to make it. I was laid off three months 03/2004 after I bought my house, my husband was force to retirement right before the war on Iraq 03/2005 it was retirement or Iraq he had already serve 20 yrs,and could not stay any longer. I tried to make as much of my payments as I could since I was the only one employed for a while. Ever since that laid off we have not been able to catch up, so please spare me!!! I think these companies take advantage of the people in need then the first opportunity they have they turn around and rip them off.


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This report was posted on Ripoff Report on 03/20/2007 05:25 PM and is a permanent record located here: http://www.ripoffreport.com/reports/household-financial-center-hfc/chesapeake-virginia-23320/household-financie-center-hfc-beneficial-ripoff-deferred-interest-no-grace-periods-cre-239929. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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#1 Author of original report

Thanks for your explanation

AUTHOR: Enid - (U.S.A.)

I really appreciate your explanation to what it sound what I have with HFC. My frustration and anger is that they NEVER EXPLAINED THIS TO ME WHEN I MADE THE LOAN, and this to me violates several laws. There has to be a way to litigate this!! If anyone knows please let me know. I am currently looking into getting out of this loan, but honestly I am scare to death to go anywhere else afraid to end up with the same problem over again. It is pretty scary when you do a loan and think you know all the terms and something happens and they have this "ah, by the way, we are doing this to you aptitud" NOT FAIR PRACTICES!!!!! and it seems to me that the consumer is at the mercy of these people!!! Welcome to America!!!! I am a citizen by the way, but really the goverment needs to step in and do something to stop these companies from reaping people's hard earn money!!!!
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#2 Consumer Suggestion

Learn more about simple interest

AUTHOR: Nikki - (U.S.A.)

I believe HFC does simple interest loans and it sounds like that is what you have. Go online to learn more about them, but I think this is how they work (someone please correct me if I'm wrong).

You do not have a grace period. If you are 1 day late, 1 day worth of interest is added to the principal balance of the loan. If you pay say $1500 monthly towards interest, 1 day late = $50 in late fees. Then that $50 gets tacked onto the principal balance of the loan, and interest over 30 years (or however many years you have left) is added. This really adds up.

So, if you are 10 days late every month, that 10 days worth of interest ($500) is added to the principal balance and you are then paying interest on the interest added. Since you are only about 1.5 years into the loan, the amount going towards your principal balance probably isn't even enough to cover the "late interest" added, so you are actually going "upside down" in your home.

On the flip side, if you have a simple interest loan and are paying even a few days early every month, those few days of interest are being taken off the principal balance. The key to simple interest loans is to pay a few days early, every month, on the same day.

Hopefully I got that right. I'm not an expert at it, but I have a simple interest loan with HFC and have been trying to learn about them.
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