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Financial Institutions Will Not Help Consumers With Credit!

Guest post by: Jewels Diver

Article Overview: This summer, after losing a significant source of supplemental income, backing out of a lease-to-purchase deal on a condo, and being in limbo regarding employment; I went into lock-down mode, and explored all possible ways to stay within my budget, protect my credit score, and prevent accumulating any new debt. This particular story is not even about the cumbersome fact that I, like many others, am completely "underwater" on my auto loan~this is about me trying to do the RIGHT thing in this Credit-Dependent Financial System we are living in, and getting nothing but sour grapes from a particular Financial Institution in Arizona.

Financial Institutions Will Not Help Consumers With Credit!

Be warned; the following story just may get you fired up as well, and a Consumer Financial Revolution may transpire.

This particular story is not even about the cumbersome fact that I, like many others, am completely "underwater" on my auto loan~this is about me trying to do the RIGHT thing in this Credit-Dependent Financial System we are living in, and getting nothing but sour grapes from a particular Financial Institution in Arizona. Looking at my credit history over the past 5 years, and considering I had absolutely NO Financial Education in school or otherwise, I am proud to say "I get" the system now, have learned from and overcome credit blemishes from the past, and have overall done a good job of staying afloat.

FINANCIAL EMERGENCY

This summer, after losing a significant source of supplemental income, backing out of a lease-to-purchase deal on a condo, and being in limbo regarding employment; I went into lock-down mode, and explored all possible ways to stay within my budget, protect my credit score, and prevent accumulating any new debt. Realizing the "whole country" was in the same boat, I went to thecredit union that holds my auto loan, and asked for any programs that could help me make it thru this phase of financial instability. At that time, my credit score was in the hi 700's, and I had a virtually spotless payment history with them since the loan origination 2 years ago.

As it turns out, they were offering a "Loan Re-Structure Program" which would give me 12 months of lower payments 'without penalty.' At the end of that 12 months, I was to either make a balloon payment of all funds not paid during that time period, or apply for financing at no-doubt a higher interest rate. Either way, I was glad and relieved to have at least 12 months breathing room to stabilize my income and make lower payments. Sounds good so far, right?

A couple weeks after I turned in my Restructure Application, I was informed I was approved! I was required to visit the branch to provide proof of current registration and insurance on the vehicle, sign the paperwork, and my lower monthly payments would be effective the following month.



BLOW #1

I visited the branch for that appointment in mid-July, documents ready, pen in hand to sign. My registration and insurance were current and valid, although about to expire at the end of the month. I was interviewing for jobs in Colorado and Arizona, and was not sure where I was going to end up working and living. I knowingly planned and admittedly procrastinated to the last minute getting the registration and insurance current, but did so as a piece of a well-thought out game plan to overcome the financial and professional challenges I was facing. I did not want to renew everything in Colorado if I was going to be living in Arizona, and certainly did not have the extra cash to switch everything over had I chosen the "wrong" state. Even though I had shown no sign of "risky" behavior in the past, and the registration and insurance I provided WAS current, the credit union decided at the last minute that very day they were NOT going to approve my Loan Restructure. I could only get approval when I was able to provide proof of updated registration and insurance. I consider that Blow # 1. I had just finished writing out my budget for the next 3 months with the assumed lower monthly car payment. My terrible mistake in thinking it was a "done deal," but nonetheless I was disappointed to see the "details" get in the way.

What I did not realize then and what I have since learned is that I had 30 days to "complete my application" and provide that information, or the application would be thrown out, my regular payment amount would be expected, and I would have to re-apply at a later date. What I also did not realize was their "30 days" began a couple weeks ago when I turned in my original application! I had gone 2-3 weeks doing nothing, thinking I was approved and ready to go, only to find out more was required of me. And meanwhile, I was still frustrated in the job search, with no clear direction as to my next move for employment.



BLOW # 2

By the time I did fax in my current registration and insurance 2 weeks later, it was too late. I was told the 30 days had expired, the information on the application was no longer valid, I would have to make my regular payment~the one I told them I could not afford, and was the reason WHY I applied for restructure~and they told me I would have to re-apply after 3 consecutive payments, but there is no guarantee I would get approved again. When I emphasized to them my situation, that I would only be able to afford the lower monthly payment amount (the original one we agreed upon at the beginning of the process, and I was ready to sign for), it made no difference. To them, the 30 days had expired, there was nothing they could do~not even take into consideration my virtually spotless payment history, the fact that I was already approved, my hi credit score, or recent employment and financial struggle. They informed me if I chose to make the lower monthly payment, it would be considered a "partial" payment and it would mean a negative report to my credit. This was Blow # 2. So, after all; my attempt to save and protect my credit score in fact turned out to be an outright attack.

I went from being at the head of the class, to being in detention in the corner~and it showed blatantly through the attitude, demeanor, and mood of those "working with me" at the credit union. I used to get smiles and friendly voices over the phone...those quickly turned to irritability, lack of patience, and definite lack of understanding and willingness to help. I kept thinking; "Wait, I was the one who tried to be proactive here, remember guys?" I was the one trying to protect my credit, who was frighteningly aware that I was in a phase of limbo, but attempted to protect what I DID have left-a great credit score and the ability to live on a tight budget.



BLOW #3

Now, a few months later; my income is barely stable but far from secure, I have made 3 "partial" on-time payments to my auto loan, and see my credit score has literally plummeted 100+ points. I went from having a score that was borderline Excellent to Weak. This is Blow #3. My precious commodity has been turned to a weapon against me. The very thing I was trying to protect is now damaged more than ever. All for one credit union's unwillingness to show some consideration, and failure to see the person and/or understand the story behind the financial identity on paper.

I am absolutely disgusted, infuriated, and in disbelief. I have just been "yelled at" by yet another 'Loan Specialist' at the credit union that holds my auto loan. Funny thing is, she was assigned to me after I complained about the displeasing level of customer service I received with the original Loan Specialist assigned to my account. It seems the whole staff has a bitter chip on their shoulder, and has generally become disconnected with people, their stories, their struggles, and their efforts to do their best to make ends meet.

Today I paid nearly $500 for the 'past due' amount and hope to stop the bleeding to my credit score. My regular payment for December is still due which means another $260 to them this month.

I realize there are necessary regulations and structures in place for the processing of such Loan Restructure programs. I also understand it is a service the Financial Institution is providing, and not necessarily a requirement for them to offer programs such as these. Still; I wasn't trying to take advantage of the system. I was trying to be honest about what I could afford given my income and other financial responsibilities. In my mind, I was one of the good guys. But ask the folks at the credit union~I would bet they might say different.

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Article Tags: balloon payment, breathing room, couple weeks, credit blemishes, credit score, do the right thing, financial education, financial emergency, financial instability, financial institution, financial revolution, good job, limbo, loan origination, no doubt, payment history, restructure, sour grapes, structure program, supplemental income
Referred by: http://jaykubassek.com



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