We have an ongoing (7 months) situation in which our loan payments are mishandled by Mazda Capital Services c/o Chase. We have a car loan to which we wish to apply extra payment each month to the principal - as our loan agreement states we can do, without penalty. Toward that end, each month we pay extra and check the box on the payment form indicating that we wish to apply the overage to the principal of the loan. Each month, the extra is misapplied, going instead toward prepayment for the next month's bill. Each month we call and bring this mistake to their attention. We have had the situation elevated to higher supervisorial levels at Chase, and it has been investigated. We have the letters from Chase to us detailing their mistakes. We have been given verbal assurances many times that this would be no thappen again. Our most recent statement, received today, again reflects that the extra we paid last month, checking the box to apply to principal, was instead applied as a prepayment of this month's bill. I am now taking the precaution of photocopying each statement before I send it, documenting that I have checked the principal reduction box. I quote from the back of our statement:
"Principal reduction checkbox: When you send a payment along with the attached payment coupon to the address on the coupon in the envelope we provide, the "Total Payment Due" displayed on the coupon will be applied according to your contract with us. If you send more than the "Total Payment Due" on your coupon and check the "Principal Reduction" checkbox on your coupon, the extra money will be applied directly to your principal balance and you'll be due for your usual monthly payment the following month. If you send more than the "Total Payment Due" and you do NOT check the "Principal Reduction" checkbox on your coupon, the extra money will prepay your payment (s) and reduce the amount (s) due on your next statement (s). Even when you prepay your payments, interest continues to accrue daily on the remaining balance."
So, each month, in spite of the fact that I clearly check the box next to "Principal Reduction, " Chase has YET (in seven months of payments) to get it right. I have to call every month. Each person to whom I've spoken has given me a different excuse - some have lied outright ("oh, never mind what it says on your statement - your money was applied to the principal.") Here are some of the other things we've been told (some by people identifying themselves as supervisors):
"Did you put a check mark or an X? Make sure you put a check mark"
"Did you put a check mark or an X? Make sure you put an X"
"Did you completely fill in the checkbox? Make sure you don't do that."
"Did you completely fill in the checkbox? Try doing that."
And our personal favorite-
"If you want extra to be applied to your principal, you should send a separate check each month to a different address that I can give you."
This must be either the most gross incompetence or a deliberate attempt to prevent people from prepaying their loans according to their contracts. Certainly this must be happening to others. Most people don't check their statements carefully, nor do they tend to understand the financial principles involved. We do. I am requesting this be investigated. If this isn't a potential class action lawsuit I would be very surprised.
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