| Ask Dr. Don
Today Dr. Don discusses loan payment
calculations and where to complain about bank service.
Calculating a loan payment
Dear Dr. Don,
I was given an interest rate of 15 percent on a home equity loan
with a monthly payment of $356. I plugged the numbers into Bankrate's
Loan Payment Calculator and I come up with a different monthly
payment. The particulars of the loan are: $25,000 loan over 15 years
at 15 percent. The calculator came back with a payment of $349.90.
How should I resolve this? Is the Bankrate calculator correct?
It doesn't sound like much but an extra $6.10 per month is $1,098
over the life of the loan. That $1,098 received over the next 15
years is worth $440 today. Who wants to give that up to the bank?
Yes, the Bankrate calculator is correct. I also ran it on a financial
calculator and duplicated the Bankrate number.
If you've got the particulars right, then either
there's something else included in the monthly payment, other than
principal and interest, or the lender is using a nonstandard method
of calculating the interest due on the loan payment. Look to your
loan agreement to find out if you're paying some type of insurance,
service or origination fee that is being financed over the life
of the loan or ask your lender why the payments don't match.
With Truth-in-Lending laws, it's unlikely that
the lender incorporated an insurance, service or origination fee
that you didn't sign off on when you closed your loan. If you find
out that you're paying for something that you feel was glossed over
in the loan process, then ask the lender to correct the problem.
If the lender is a bank and can't explain to
your satisfaction why the payment differs from the loan calculators
then you should contact the Customer
Assistance Specialists at the Office
of the Comptroller of the Currency and ask them to help you
work with the bank to solve the problem.
Where to complain about a bank
Dear Dr. Don,
I recently asked my Virginia based bank to send me a check for interest
earned in my account over the past year. The bank took 10 days to
process my request before mailing the check -- after they had told
me it would be mailed the day after my request. I complained and
they told me it was just one of those things. Then, and only then,
they mentioned they could have wired the funds to my local bank.
(Useless information to me at this point.) I wrote to them requesting
they speed up this process and asked for assurance it would not
happen again. It is a federally chartered bank. If I wish to write
a letter of compliant, to whom do I write? Is there a bank department
in Virginia? Or is there a complaint department within the Federal
You got lousy service, and it no doubt inconvenienced you in your
plans to use that money, but do you really need to make a federal
case out of it? A wire transfer isn't always the answer. Wire transfers
are for when it absolutely, positively has to be there today. Banks
typically charge between $25 and $50 for that service. Most savers
will wait for the check because the wire fee really eats in to the
yield on their savings. Still, it would have been nice if the client
service rep had let you know that was an option.
Not dissuaded from lodging a complaint? Then
the best place to start is with the Customer
Assistant Specialists at the Office
of the Comptroller of the Currency. The Office of the Comptroller
of the Currency (OCC) charters, regulates, and supervises national
banks to ensure a safe, sound and competitive banking system that
supports the citizens, communities and economy of the United States,
according to the OCC Mission Statement.
The State of Virginia has a Bureau
of Financial Institutions as part of the Virginia
State Corporation Commission. Their purview is more over state
chartered financial institutions than federally chartered national
banks, but they may be able to help you with your complaint.
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of such content, advice or the answers provided to you. Our content, advice
and answers are intended only to assist you with your financial decisions. However,
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--Posted: Sept. 29, 2000