HSBC Watch News Release :: Late Fees and interest called due

Fri Aug 27, 2004 11:08 am

I was on a 6 month interest free payment plan with Household Retail Services for a purchase from Best Buy. I had no problems the first 3 months.

Then one day I received a bill with a late charge! Don't companies usually try to contact you if they have not received payment? Come to find out they did not receive the payment that I sent in the mail. So I asked to have the late charge waived and they said they would if I paid the paid the past due bill and the current bill which I agreed to but I had to do it THAT DAY and that there was going to be a $15 charge. I said I did not want to pay the $15 charge to pay by phone, so they said I could make payment at bestbuy.com, so I did.

Come to find out, that didn't go through either. I did not get a bill for the next month and then they did finally sent me a letter, now with two late charge fees. At that point I was speaking with collection department and I said that I wanted to just pay off they loan because I am tired of dealing with them. I paid the amout that I owed without the late fees.

THEN, I get another bill for the next month with late fees, and lo-and-behold, I'm over my financing time period so now they are charging me the interest for the 6 months!

I had my suspicions that I was being ripped off because I have never had this type of problem - companies not receiving my checks and companies not mailing me a bill.

I could believe when I found that this is not an uncommon practice for Household Retail Services. And when I was arguing with them on the phone, saying that they were trying to rip me off, they acting like they had never heard that before. I will end up having to pay them $100 more than what I actually owe. What can I do?

Fri Aug 27, 2004 11:23 am

CB in Minnesota wrote:

I was on a 6 month interest free payment plan with Household Retail Services for a purchase from Best Buy. I had no problems the first 3 months.

I had my suspicions that I was being ripped off because I have never had this type of problem - companies not receiving my checks and companies not mailing me a bill.

I could believe when I found that this is not an uncommon practice for Household Retail Services. And when I was arguing with them on the phone, saying that they were trying to rip me off, they acting like they had never heard that before. I will end up having to pay them $100 more than what I actually owe. What can I do?

Not mailing you a bill is a violation of Regulation Z. Even with a change of address, the creditor is required to mail a bill to the last address on record.

Companies must apply your payment in a timely manner. Again, we reference Regulation Z. Household knows that many customers are surprised to learn that they cannot make a payment at the store where merchandise was purchased. Therefore, they also know that a delay of two days in processing online or telephone payments will result in more profits for Household due to a late fee. Compound that with the fact that statements are received by the consumer very late in the billing cycle.

This is a receipe for disaster for the consumer and high profits for Best Buy and Household. That's the bottom line, and a point that we here at Household Watch have been making for years.

In Shea vs Household facts came to light that payments were intentionally applied one day late, resulting in late fees and overlimit fees, and the practice was ongoing for almost 10 years.

In your case please remember that Best Buy was the enabler and Best Buy received a portion of the excess that you paid, i.e., late fees and interest. Best Buy received that money as "ongoing compensation" from Household.

Use your own Visa card, and never accept the "dual application" MasterCard from Best Buy - Household, under any circumstances, for the exact reasons stated herein.

Fri Dec 31, 2004 5:11 pm

CB, they did the same thing to me. I do think it is their way of ensuring they get to collect interest on their same-as-cash deals. When I talk to their "Collections Counsellors", they have an almost identical script, and act shocked that I believe they could be wrong. I originally charged $2900--not because I had to, but because it builds my credit and costs me nothing. Except with HSBC, who ENSURED I would be late and put the burden of proof on me--which they know is impossible for the consumer to prove. They now say I owe close to $3500 with the addition of fees and penalties. They weren't sending me statements. I'm great at paying bills as soon as they come in, and have never before paid interest. The problem is, their bill didn't come in and I assumed I'd paid it off. They have no responsibility to us, the consumer. I wish I COULD prove it ws their purposeful negligence, and force each smug customer service person and "Collection Counsellor" to give me a verbal and written apology for treating me as though I'm a bum and a liar.

Fri Dec 31, 2004 5:46 pm

CB, they did the same thing to me. I do think it is their way of ensuring they get to collect interest on their same-as-cash deals. When I talk to their "Collections Counsellors", they have an almost identical script, and act shocked that I believe they could be wrong. I originally charged $2900--not because I had to, but because it builds my credit and costs me nothing. Except with HSBC, who ENSURED I would be late and put the burden of proof on me--which they know is impossible for the consumer to prove. They now say I owe close to $3500 with the addition of fees and penalties. They weren't sending me statements. I'm great at paying bills as soon as they come in, and have never before paid interest. The problem is, their bill didn't come in and I assumed I'd paid it off. They have no responsibility to us, the consumer. I wish I COULD prove it ws their purposeful negligence, and force each smug customer service person and "Collection Counsellor" to give me a verbal and written apology for treating me as though I'm a bum and a liar.

Mon Jan 10, 2005 7:41 pm

I bought a digital camera from best buy before thanksgiving on a no interest plan since I did not have the cash available at the time I applied for the best buy credit card. After New years I went back to best buy and since I have not recieved my first astatement I wanted to pay the Bill They told me that I could not pay it in the store. that I either cvould pay it online or directly to HRS. So I called HRS and after an hour being on hold my cell phone battery died. I call customer service the next day and explainde that I never recieved the first bill. They told me thay had sent it out and I should have had ample time to pay it (mind you it was only a 20 dollar payment) I asked them If they could waive the 22 dollar late fee and they said NO. I asked to speak to the manager and got the same reply I notified her of the fact that I never recieved the first statement and that the due amount was only 20 dollars. i also told her hat nobody in their right mind would want to ruin their credit over 20 dollars she again told me too bad. I checked my online statement that day to find that my new due balance was 57 dollars after the interest and lete fees are applied. What is the best thing to do in this cituation?

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