Balloon Finance Charge

ComplaintsBanksHSBC INSURANCE SERVICES /BEST BUY CREDIT CARD

Complaint

0
David Stadig
Country: United States
I had purchased a computer on an 18 or 24 month no interest deal. be that as it may, I've been making my payments online. The payments (their minimum payments) were always due on the 22nd. Well. I made my last payment on the 22nd and lo and behold, I get an email from these people stating that I owe them $288 in finance charges which are now subject to 26.99% interest. On their online payment site it did not mention this at all. This is deceptive to say the least. I called them and the first guy, who is in India, would take off my payment of $81.23. His supervisor, also in India, would cut it in half. I told them they shouldn't be charging me at all as my payment was on time. I got the same BS story from both of them that my 3 months prior statement said my promo end date was the 16th. I told them that there ws no mention of this on the payment site, which there wasn't and isn't. This company IS the worst and their actually better than they used to be. I have every intent of complaining to my state regulatory authority.
AVOID this company at all costs and I'm DONE with BestBuy, and any company that uses HSBC as the financing arm.

Comments

  • 0
    Jamie Wollman
    I have the same issue with HSBC/Best Buy. There is no indication on the on-line payment site as to when the balloon is due and it is NOT the same date as the regular payment due dates. My end date was a week after my regular payment date and I did not notice this until 4 days after that balloon date. Consequently, HSBC is now seeking $3900 in interest charges for a payoff that was 4 days late. This is a complete scam. I sent a written protest and HSBC responded with a denial of my request. (I tried talking to the service reps in India and that was a waste of time). I am filing a complaint with the new Consumer Financial Protection Agency and will file a lawsuit.
  • 0
    tj
    This is a pretty common practice with "no interest" "deals".  

    Although no interest is charged if you pay the whole amount within the "no interest" period, it is still accrued, and all accrued interest becomes due if for any reason you fail to pay off the whole balance in time.  

    They made the sale since you figured it wouldn't cost you any interest, maybe even selling the product to you at a price over what a competitor might offer, yet they know a lot of people taking this offer will get suckered, and they can even give them a little push in that direction.  The longer the "interest free" period, the more they make when you miss the payoff payment.

    They make a lot of money through this tactic, as most people just trust that their statements will remind them when the final payment is due.  By the time they find out, it is too late.


    It is generally best not to use store cards at all.  Their interest rates are too high anyway (typically 24%, compared to (10% to 15% on normal bank cards), since they assume customers using them can't get better rates elsewhere.

    You do not want your bank handling payments to be in bed with any merchant you might choose to pay, in case you have any problems.  In particular, you do not want your bank and the merchant to have interests at direct odds to your own, and to have an incentive to set you up.
  • 0
    KDS
    Best Buy suckered me. I bought appliances and a home theater on a 3 year same as cash promotion. They told me it would be faxed to the finance company and approved prior to delivering the appliances. I have made payments monthly and decided to pay off the balance early. After I paid off the balance I got a statement from HSBC stating that I owed the interest on the purchase. Apparently  Best Buy duped me into thinking it was a done deal. Come to find out it was only an 18 month same as cash deal and my loan payoff was one day after the expiration of the 18 month time period. Basically I made the purchase based on the promotional financing. Now Best Buy tells me it is my problem with HSBC. I went to Best Buy because of the promotion and for no other reason and got screwed. Best Buy is having problems and now I see why. I will never purchase another product from Best Buy and I have been a loyal customer for over 15 years. I will also never use any promotional financing from any retailer.  I would love to see a class action lawsuit against Best Buy and HSBC. Good buy Best Buy!
  • 0
    Rob
    Hello,

    I have encountered the same problem with best buy. Yes it was my fault with not reading and asking 1500 questions before signing my name on the dotted line. In Sept. 2008 I purchased a TV, entertainment stand, and home theater system for roughly $1700 on my 3 yr interest free Card for best buy... Long story short I couldn't make my payment in full at the end of the 3 yr mark and had roughly $600 left on it. It is when I received a Bill in the mail 3 yrs later when I realized what happened. I was charged with 3 yrs back interest on that purchase which was at 25% (outrageous!) ... I  have been paying on this bill as much as I can but am getting no where because I am paying interest on top of interest.... My balance is under $3900 for the 1st time in a yr even while paying $300/month on this bill... What I'm wondering is if there is any way to just settle my remaining balance and stop paying interest on my interest. I realize this is my fault but there has to be a way to stop this from continuing to happen. I've tried talking to both best buy and HSBC and now Capital One and they all give me the same run around about it being a set APR and blah blah blah. Because my credit score  is low, I cant get approved for enough for a  balance to transfer to another credit card with interest free for 18 months. Which then atleast if I am making $300/month payments and with taxes coming back id b able to pay this all off.... Anyone with any advice please respond. I'm to the point of just saying screw it and not paying it off anymore and just letting it go to the debt collector so I can have a set rate with them. I know it will hurt my credit but that can be built back up over time unlike my money that I'm just throwing away...

    Thank You for your help in advance,
    Rob
  • 0
    Karrie
    I think there should be a class action suit as well...they apply most of the payment to your purchases that have already had the deferred interest charged on the account and then if you have another deferred interest purchase that is still deferred, they pay the smallest amount of your payment towards the deferred interest that you never even signed up for!! When you call to have them take it off, they cant take the 18 mo no financing as its in the "terms and conditions." But yet you get new terms and conditons every other month because some other credit company takes over (chase habc capital one back to hsbc). And then you get charged interest on top of the interest? How insane! They will probably end up going out of business...and no one your calling is from the United States which is even more frustrating!

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