In May I received a notice in my mail from Capital One Auto Finance that I had been "Pre-approved" for refinancing on my 1999 Mazda Miata (they new what make, model and year my car was), which would be for "Significantly lower monthly payments" and a 3 month grace period before the first payment was due.
My current monthly payments were $382/mo. I am on a very tight budget and thought this could really help me out. With interest rates falling this seemed perfectly logical to me, so I completed the form and returned it. I also checked what the current pay-off on my current loan was which I was told by the current lender was $12,915.
I received, about 2 weeks later, a contract in the mail and a statement, mailed separately, but arriving on the same day. The contract stated my monthly payments were $408/mo and the statement said my first payment was due on June 15th, just a few days from receiving these documents.
I called Capital One and asked why neither promise was kept - the lower monthly payments and the 3 month grace period. The woman I talked with said they could give me the 3 month grace period but my payments would then be $411/mo. Since, if I did not agree to this, I would have to come with an unexpected payment within days, I had little choice but to agree. But at least I had 3 months to plan my budget for the larger than expected monthly payment, and thought I might trade the car in anyway.
During those months I went to a Mazda dealer to do just that, trade in my Mazda. They would not do the deal because they said they checked the pay-off on the car with Capital One and they were told it was $15,852 which was more than the value of the car. So I figured I was stuck with the car with $411/mo payments.
My statement came for the amount due after the 3 month grace period and it was for $426. I paid it and started my campaign with Capital One to get this thing straightened out. I have made approximately 4 -5 calls to them per week since the beginning August, sometimes resulting in a dead end, sometimes with promises of returned calls.
No one has ever returned any of my calls. One "supervisor" told me my statements were incorrect and I should pay the amount that was stated on the contract I signed. I received a second statement with an amount due of $429. My third statement had an amount due of $ 437 - this is now more than $50 per month than the monthly payment on my previous loan.
I took the "supervisors" advice and paid the amount on the signed contract, including a copy of the contract with the payment. I received a notice that my car would be repossessed unless I came up with the difference in a few days.
I filed a complaint with the Better Business Bureau, and received notice back from them that Capital One was not responding to their inquiries and I should give them another 60 days. I don't know what to do. I need my car to get to and from work. I am on a very tight budget, with a lot of my monthly expense, much of it going towards Capital One credit cards. This increased auto payment has thrown my budget into a downward spiral.
This can not be legal, and if it is it certainly isn't ethical, and if by some stretch it is ethical it definitely is not fair. It seems designed to prey on those who can least afford this type of situation. Capital One has all of an individual's financial information including their income and monthly expenses, so they certainly could know that by this practice they driving individuals into repossession of their cars.
My pay-off on my car was $12,900, and I have no reason to believe my previous lender would be dishonest about that. So I believe that is what Capital One paid for that loan. I have paid $1263 so far making their cost for that car $11,637. Current Blue Book is right around $13,000. So if they do repossess and resell they make a nice little profit and leave me financially devastated.
I think bringing this issue some daylight will help, but if you have any other suggestions I certainly would appreciate hearing them. I am sure there are many out there experiencing the same thing, especially since the reps at Capital One have a prepared script for each of these issues. One rep told me, in a slip of the tongue during a heated discussion, that "unfortunately we are not going to keep our initial promises", "there is nothing you can do to change this" and "many of their customers are confused and can not understand why they have higher monthly payments".
Capital Auto Finance, I believe is relatively new, so I figure other are about at the same place I am in the process. Getting your car repossessed is embarrassing and I suspect many individuals have decided to bite the bullet and live with it.
I told the rep there is always something you can do to change things.
James
Austin, Texas
U.S.A.
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