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Before we begin with my complaint...

HEY LENDING CLUB and the rest of you financial criminals...

There is a NEW Sheriff in Town and regardless of your political party, President Obama has a new Financial Enforcement Agency that actually chases the Financial Bad Guys and has every banker's heartbeat racing..

The CFPB also known as Consumer Financial Protection Bureau

http://www.consumerfinance.gov/complaint/

https://en.wikipedia.org/wiki/Consumer_Financial_Protection_Bureau

Don't let this seemingly nice sounding government agency title fool you.

Bankers fear the CFPB more than the IRS, FBI and SEC combined because since their inception they have been given wider sweeping authority without many of the constraints of the other agencies.

They go in, kick *** and take names the way early FBI Federal Agent Eliot Ness set out to stop Al Capone.

Go Get Em Boys (and Girls;)!!

I wonder who will play CFPB Director Richard Cordray's Character in the Hollywood Movie? Sebastian Stan (Captain America)?

Christian Bale?

Daniel Craig?

OK... NOW BACK TO OUR REGULARLY SCHEDULED PROGRAM...

In mid-January 2016 I applied for a $16,000 with average 725 Credit Score and offered 12% interest rate after I completed the online Pre-Approved webpage application, they send me loan documents within a few hours stating Original Loan Amount $16,000 approved for a Loan Term of 36 months at an Interest Rate 19.48%.

THEY CLEARLY STATE IN WRITING "NO PREPAYMENT PENALTIES"

"Does Lending Club charge a prepayment fee or penalty?

No, you can partially or fully prepay your loan at any time with absolutely no prepayment penalty or fee. Prepaying your loan will eliminate future interest payments.

Any additional payment will be applied towards a reduction in the principal of your loan, so it will allow you to repay your loan early (and thus reduce the total amount of interest you'll pay), but won't reduce your monthly payments. A full prepayment of principal will pay off your loan and bring an end to your monthly payments."

EXPLAIN HOW $14,991 owed becomes $15,210 to pay off then LendingClub?! Sounds like a lie to me!

Or in legal terms...False Advertising, "Bait and Switch", Detrimental Reliance and Breach of Contract, Predatory Banking, probably another 100 tort, civil and criminal US and State laws.

READ THIS CLOSELY...IT SOUNDS LIKE PREPAYMENT PENALTY DRESSED UP AS A 1% Service Fee:

"WHAT HAPPENS IF A LOAN IS REPAID EARLY?

Borrowers may prepay their loans at any time, in whole or in part, without penalty. If a borrower makes a prepayment during the first 12 months after loan issuance, then you will receive your pro rata share of the payment less the 1% servicing fee, charged as a percentage of the monthly contractual payment amount only, regardless of the borrower’s prepayment amount.

For example, if the contractual monthly payment amount for a Note is $300 and a prepayment payment of $4,000 is received for that Note, an investor would only be charged a servicing fee of $3 (1% of $300).

If a borrower makes a prepayment after the first 12 months after loan issuance, then you will receive your pro rata share of the payment less the 1% servicing fee, charged as a percentage of the total prepayment amount received."

That should have been my first RED FLAG.

But since it was February 1st they had just completed the mini-deposit and withdrawal of $0.78 to verify my bank account and I had already provided them with all of their required documents, pay stubs, etc., etc. I figured I was a day or two from being funded and would go ahead since I only needed the loan as a bridge loan for a few months until a project funding came through.

First, the loan took almost 2 weeks to complete and be funded...not the quickie loan service they lead you to believe they are.

Second, the APR (Annual Percentage Rate interest of the loan) was a WHOPPING 23.25% APR NOT THE OFFERED Interest Rate 19.48%

EVIDENTLY IN THE PREDATORY BANKING WORLD THIS "Bait and Switch" is common...though shouldn't be legal

3.5% more when the math is done really doesn't resemble the initial offer, does it?

Loan was paid into my account February 2nd 2016 minus an $800 Loan Fee

(REMEMBER: THIS ISN'T A MORTGAGE!? BUT AN UNSECURED LOAN, WHICH BY THE WAY, COULD HAVE BEEN DONE BY GETTING A 0% for 12 month credit card with $0 annual fee.)

Monthly payments of $590 for 36 months

So $16,000-$800+$15,200 paid weeks later.

MONEY CLEARED MY BANK ACCOUNT ON FEB 3rd 2016

FIRST PAYMENT OF $590 DUE AND WITHDRAWN FROM MY BANK ACCOUNT VIA DIRECT DEBIT FEBRUARY 26th ONLY 23 DAYS AFTER RECEIVING FUNDING OF $15200...NOT THE $16000!?

Which for most people would mean they are using their loan money to make their first payment!

AND $800 in the hole since they've already deducted their "Loan Origination Fee" from their already over-inflated interest rates.

So now I am $1,390.00 out of pocket only 3 weeks into receipt of money from LendingClub.

May 2016, 2 months later I decided to pay off this loan and the below indicates all of my transactions from beginning to end with LendingClub. maybe one of you are related to an Assistant US Attorney General to translate how the legality exists.

Now for the REAL "Smoke and Mirrors" money disappearing act:

Upon checking online and via phone I was instructed my remaining balance was $14,991.84

However, when I called them to arrange the actual payment transfer, since you CANNOT do it like everything else online... I was told payoff amount was actually $15,210.88

$208.04 MORE THAN I ACTUALLY OWED and $10.88 more than I received from LendingClub AFTER I PAID 3x $590.39 ($1,771.17) + $800 Loan Fee + $208.04

TOTALLING $2,779.21 PAID from February 26 - April 23, 2016 (PAYOFF AMOUNT WITHDRAWN FROM BANK) 83 Days from receiving money from LendingClub or in other words:

I PAID:

$2,779.21 for 83 days not $1,605.86 (3x$590.36)

$1,021.77 per month for 2.72 months

($2,779.21 ÷ 2.72 months = $1,021.77 PER MONTH!

NOT $590.36 a Month...but $431.41 PER MONTH MORE $1,021.77

-or-

42.22% INTEREST ON TOP OF THE 23.25% APR ALREADY IN THE LOAN

$2,779.21 = $33.49 PER DAY!!! x 83 days NOT the

$19.34 per day for 83 days on an ALREADY OVER-INFLATED LOAN!

When I called them on it, because they will not respond to you "IN WRITING" via email (that would put them too legally at risk of admitting any potential legal liability...but the math speaks for itself)

05/31/2016 DIRECTDEP LENDING CLUB DIRECTDEP REFUND $0.01

05/23/2016 DIRECTDEBIT LENDING CLUB DIRECTDEBIT -$15,210.88

04/26/2016 DIRECTDEBIT LENDING CLUB DIRECTDEBIT -$590.39

03/28/2016 DIRECTDEBIT LENDING CLUB DIRECTDEBIT -$590.39

02/26/2016 DIRECTDEBIT LENDING CLUB DIRECTDEBIT -$590.39

02/02/2016 DIRECTDEP LENDING CLUB DIRECTDEP $15,200.00

02/01/2016 DIRECTDEBIT LENDING CLUB DIRECTDEBIT -$0.78

02/01/2016 DIRECTDEP LENDING CLUB DIRECTDEP $0.78

So whenever you need to borrow money, go to your Credit Union, your 401(k), even your regular bank... but tell LendingClub NO THANK YOU because they are crooks! Even their CEO is in just a little bit of hot water. They are NO BETTER THAN "PAYDAY Loan" companies...and people with low credit scores should never be charged "Loan Shark" rates let alone good credit scores of 720+ that banks offer the best rates to.

"A Wolf by any other name is still a Wolf"

LendingClub are the bottom feeders of the financial world.

DomSamui wrote the review because of pricing issue at Lending Club and attached a photo. Reviewer claimed that he or she wants Lending Club to read this review and look into the issue (if any).

The author asks this business to immediately contact him/ her to briefly discuss his/ her negative experience with the company.

We collected other reviews about products and/or services offered by Lending Club and lending club loan for you to read. This information may help you with your purchase decision.

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Anonymous
#1524768

You must be wildly mistaken. They would never charge that much interest with that kind of credit score.

I know, I've had two loans with them in the last couple of years, starting at the beginning of 2016. I paid them both off early and....online, so I think you are mistaken.

Anonymous
to Terry #1524828

Those are the facts and besides high interest even with a good credit score, there are many online lenders, banks and credit unions that won't charge you an upfront lending or loan origination fee, content with a competitive interest rate.Lending Club at that time didn't and have had some regulatory issues since that complaint

Anonymous
#1501936

I guess you didn't read the loan documents before getting the loan , it shows origination fees .

Anonymous
#1477287

Thank you so much for this information. I get so many “pre approved “ apps in the mail. I just throw them in the trash.

Anonymous
#1416869

The math seems to all work out to me. You borrowed $16,000; $800 of which was an origination fee.

If you wanted to have $16,000 cash after all the fees and loan costs; you should’ve either borrowed $16,800, or come up with the $800 origination fee out of pocket.

Anyhow, after the first 3 payments; you will have paid this much towards the principal balance:

$1,008 = 331 + 336 + 341

(Find using amortization calculator with 19.48% interest rate, 36mo loan term, and a loan amount of $16,000) The rest of that $569 each month goes toward interest.

This actually makes total sense, because when you subtract $16,000 -$1008, you get $14,992....the stated remaining balance! Which by the way; the “remaining balance” IS NOT the same thing as the “payoff amount” (Much like “interest-rate” IS NOT the same thing as “APR”) - The “pay off amount” will include the remaining balance PLUS all of the combined interest (and sometimes unpaid fees also) that has accrued between the date of your most recent monthly payment and the date of your final pay off.

For simplicity’s sake, let’s assume that monthly loan payments are made exactly 30 days apart.

You made your 3rd monthly payment on the 26th....the pay off was made on the 23rd of the following month - so not quite a full 30 days later - you were 3 days early. So, instead of a full 30 days of accruing interest in between, there was only 27 days. Now, according to that same amortization calculator; you will have paid exactly $243 toward interest with your 4th monthly payment....so we need to calculate a ‘pro-rated’ interest charge for 27 days worth of interest. To do this, we divide the total of the 4th month interest ($243) divided by 30 days = $8.10 interest per day (during the 4th month specifically).

So 27 days’ worth of interest would be.... $8.10 x 27 days = $218.70 So, while your remaining balance was $14,992, there were 27 days worth of Unpaid Interest Charges leading up to your payoff. Therefore, in order to pay off the debt completely, you need to pay the remaining balance, plus cover an additional $219 (rounded) in interest. So, the total pay off is....

$14,992 + $219 = $15,211 And what do you know? That is the EXACT SAME amount those scam artists pulled out of thin air! Except they didn’t. They were using sound lending calculations and were not trying to charge you a dime extra.

That is not to say this was a good loan; it certainly was not a good loan at all. And yes, other financial options would’ve been much more beneficial for you. But you were the one that agreed to the terms without understanding them. Let this be a lesson to you and everyone else out there; if you do not understand certain aspects of your loan, or you think you are being charged more than you should be; ask for clarification!

Once you completely 100% understand everything, only then can you truly consider all available options clearly and weigh the pros and cons. I would suggest, if you are able; that you rescind this complaint immediately, with an apologetic explanation. Because these people were not trying to scam you at all. You were simply asking for a very unusual loan, and they gave you some equally unusual terms.

They probably didn’t understand why you would want to take on a loan like this one, but their job is not to advise you financially...their job is simply to give you what you were asking for, and they make a living to do so. Furthermore, the CFPB is nothing new. And we certainly don’t have Barack Obama to thank for it. The CFPB is a government organization that was established as a result of the Dodd-Frank Act of 2009 - this is right about when the housing bubble burst as a result of predatory lending tactics levied against individuals who signed very important financially binding documents (namely new mortgages and mortgage refinances) without fully understanding the terms of the loans themselves, much like you did.

At the end of the day, it is not a financial lender’s responsibility to protect consumers from making a potentially harmful financial decision; but the federal government stepped in anyway and enacted rules and tight regulations to which the lending industry must adhere. The purpose of which is meant to protect consumers from their own financial short-sightedness and naivety. The CFPB would have no problem whatsoever with this loan that was written for you.

The CFPB’s job is mostly to prevent lending institutions from allowing consumers to borrow money when they may have unsatisfactory qualifications (based on strict, universal CFPB-defined guidelines) and/or have less than ample means to pay back those loans. Lenders of yesteryear would write mortgages and refinances for people whom they knew could likely not afford to pay them back over the long term; figuring that they (the lenders) could just repossess the defaulting borrower’s home if needed, and stood to make quite a hefty profit either way with such a booming housing market securing those “predatory” loans.

Anonymous
to Tyler S #1427139

The way I read my terms, Lending Club has a network of lenders, they match you up with. What you borrow, lender also "lends" the origination fee, thus your actual request is full amount, minus origination fee.

So, $5,600 for me was approved, I got $5,200 and change, after that, knowing I am responsible for whole $5,600, and full understanding why. It was up front, told so, and I'm ok with that.

They proved legit to me. Wasn't nothing hidden, and surely not as wild of terms and interest as like one main financial.

Anonymous
Carlisle, Pennsylvania, United States #1319606

Its called interest......... LOL....

pay the money, learn your lesson...

19% interest, oh no 23+ apr... good luck.

Anonymous
to Big Ronald #1524830

Or....find a better lender that doesn't charge you ridiculous interest and fees above what they originally offered you until you complete your application with high 700's low 800's credit scores then lower the amount, increase the rate and surprise you with a loan fee deducted from the loan amount.All was NOT listed in the original offer only after you took the credit/scorevreport inquiry ding.Sorry, there are other more honest lenders out there.

Anonymous
Arnold, Maryland, United States #1218407

Please take a basic money course and learn about loan origination fees as well as interest and accrued interest. Credit cards make more money off the fees charges to merchants than interest, so they don't charge loan origination fees typically ( or annual fees in credit card terms).

The first couple months payments are going to reduce principal minimally as it is an amortized loan. At 23% the first 3 payments would pay off appr. 650 in principal, and have about $1000 in interest. The difference between your principal and payoff amount is the accrued interest.

The interest charge is almost 310 a month the first couple months so if you tried to payoff more than halfway between due dates the accrued interest would be around $200. Nothing wrong was done, just an uneducated consumer not understanding basic loan mechanics.

Anonymous
Pittsburgh, Pennsylvania, United States #1211326

If your credit score was so great then why did you go there in the first place?

Anonymous
Carson City, Nevada, United States #1191194

So I've applied, now i want to back out, but i cannot find any where to cancel.

Anonymous
to Anonymous #1427141

Just don't finalize acceptance, then not obligated.

Anonymous
Metuchen, New Jersey, United States #1180620

Wow!!! Your very detailed review was an eye opener for me for sure.

Thank you!

I was really thinking hard about accepting the loan offer that was sent to me, but I am going to look elsewhere now. Thanks again.

Anonymous
Richmond, Virginia, United States #1177640

Thanks for your detailed review. I was considering a loan with them, but not now!

LendingClub
Anaheim, California, United States #1176790

Hello. Lending Club strives to provide the very best service to all of our customers.

We’re sorry we didn’t meet your expectations and appreciate your feedback.

We’ll use your feedback to improve our service, and hope that we can regain your confidence in the future.

Please let us know if you have any additional questions or concerns. You can reach us at support@lendingclub.com.

Anonymous
to LendingClub Bronx, New York, United States #1200635

LC these form letter replies are insulting to say the least.

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