Rant about PenFed's poor customer service

[freedomatlast]

I bought some property last June. I didn't really need a mortgage, but because of PennFed's low rates, I applied. I had to close on the property in 45 days. I dealt with one incompetent service rep after another, each one wasting more time and claiming different requirements, forms, and letters were needed. One even asked me to write them a letter as to why I wanted a mortgage and why I bought the property which would be used as a primary residence. Finally I had enough. Got to talk to a manager high up in the organization, cancelled the application, and had them waive all cancellation fees. Just ended up paying cash. BTW, I had almost as much money in CDs with them than I was asking for in a mortgage, but it didn't seem to matter to them.

[REWahoo]

My daughter had a similar experience applying for a PenFed mortgage. I understand they outsource the mortgage application process to a third party provider. Sounds like they went with the low bidder.

[audreyh1]

Quote:

Originally Posted by FUEGO Oh, didn't realize you were on an ipad. I guess they don't have GPS?

iPads only have a GPS if they have a cell data chip.

DH had pretty good luck with the MotionX app on his iPhone5 and downloading maps and using them in Europe with no data connection.

[Nords]

Quote:

Originally Posted by FUEGO Oh, didn't realize you were on an ipad. I guess they don't have GPS? If you're interested in a cheap but pretty good cell phone, I'm on a Samsung Galaxy S3 (the S6 is out now, so I'm waaaay behind the times ). Sub-$100 for used on ebay and you can probably get refurbished ones for about $100. Mine is a sprint phone which doesn't use a SIM (so I can get free service on Freedompop), but I assume they have SIM varieties that can be used on T-Mobile. I didn't know if you were locked into the Apple ecosystem or if android was good enough. Battery life is pretty good on the S3 and we used it to navigate on foot around Belize City, Nassau, and some other areas (using google offline maps) and it was a huge upgrade to my old HTC something or other with crap battery.

Quote:

Originally Posted by audreyh1 iPads only have a GPS if they have a cell data chip. DH had pretty good luck with the MotionX app on his iPhone5 and downloading maps and using them in Europe with no data connection.

Thanks. I'm taking notes here.

My spouse is familiar with iOS and iPhones so, as tech support boy, I hesitate to introduce Android into our home. But I think Android does some things better, so I'll go with whatever T-Mobile offering and hardware/software we find.

[MooreBonds]

Quote:

Originally Posted by freedomatlast I bought some property last June. I didn't really need a mortgage, but because of PennFed's low rates, I applied. I had to close on the property in 45 days. I dealt with one incompetent service rep after another, each one wasting more time and claiming different requirements, forms, and letters were needed. One even asked me to write them a letter as to why I wanted a mortgage and why I bought the property which would be used as a primary residence. Finally I had enough. Got to talk to a manager high up in the organization, cancelled the application, and had them waive all cancellation fees. Just ended up paying cash. BTW, I had almost as much money in CDs with them than I was asking for in a mortgage, but it didn't seem to matter to them.

I had a similar frustration with PenFed's mortgage division - I had a 5/5 ARM mortgage with them, and was refinancing to their 1.99% 5 year Home Equity loan. The Loan to Value ratio on the 5/5 ARM was about 65%. The LTV on the Home Equity Loan would have been about 60%. At first they wanted to charge me $300 for a home appraisal.

I balked and pointed out how their application said that they do appraisals if LTV is 70% or more. I pointed out that using my county's real estate assessor's value yielded a LTV of 60%. PLUS - by switching to a 5 year Home Equity Loan as my loan, it is DECREASING PenFed's credit exposure to me, because I'm paying them much more principal, faster, on a 5 year amortization schedule, versus the remaining 28 years on my original 5/5 ARM. So between the two, there shouldn't really be any reason to have to bill me $300 for another appraisal - they had already done 2 appraisals in the previous 2 years (first was when I obtained my original 30-year fixed mortgage, then another one when I refinanced to the 5/5 ARM).

[Gumby]

Let me offer a counter-example. Three years ago, the young wife and I took advantage of the 5 year 1.99% PenFed home equity loan to finance out of the last of our mortgage with a local bank. We found the process to be very smooth and uncomplicated, and the representatives I spoke to on the phone were knowledgeable and helpful. They appraised the house (even though the LTV was less than 15%), but we didn't pay for it. Nor did we pay any other closing fees. IIRC, they keep track of them, but waive them after a certain period. We also have PenFed credit card and have not experienced any problems with it.

[ExFlyBoy5]

Quote:

Originally Posted by Gumby Let me offer a counter-example. Three years ago, the young wife and I took advantage of the 5 year 1.99% PenFed home equity loan to finance out of the last of our mortgage with a local bank. We found the process to be very smooth and uncomplicated, and the representatives I spoke to on the phone were knowledgeable and helpful. They appraised the house (even though the LTV was less than 15%), but we didn't pay for it. Nor did we pay any other closing fees. IIRC, they keep track of them, but waive them after a certain period. We also have PenFed credit card and have not experienced any problems with it.

That was my experience when I got a HELOC. The process was very easy and took no time at all. This was a couple of years ago though, so not sure if they had outsourced the processing then or not. I also assume since my LTV was about 25% with no first mortgage, I'm sure it was very easy to underwrite. No appraisal or closing costs unless account was closed within 2 years.

Sent from my mobile device so please excuse grammatical errors.

[FUEGO]

Quote:

Originally Posted by Gumby Let me offer a counter-example. Three years ago, the young wife and I took advantage of the 5 year 1.99% PenFed home equity loan to finance out of the last of our mortgage with a local bank. We found the process to be very smooth and uncomplicated, and the representatives I spoke to on the phone were knowledgeable and helpful. They appraised the house (even though the LTV was less than 15%), but we didn't pay for it. Nor did we pay any other closing fees.

+1

I'm on the same loan and have around 2 years left. No issues, and closing was very pain free (other than having to sign some form they forgot and mailing it back with a SASE they provided).

[MooreBonds]

Quote:

Originally Posted by Gumby Let me offer a counter-example. Three years ago, the young wife and I took advantage of the 5 year 1.99% PenFed home equity loan to finance out of the last of our mortgage with a local bank. We found the process to be very smooth and uncomplicated, and the representatives I spoke to on the phone were knowledgeable and helpful. They appraised the house (even though the LTV was less than 15%), but we didn't pay for it. Nor did we pay any other closing fees. IIRC, they keep track of them, but waive them after a certain period. We also have PenFed credit card and have not experienced any problems with it.

I'm certainly willing to go through a few hoops for some great benefits (lower costs) in return, as I realize that most customer service can be a hit-or-miss thing...so not trying to sound like I was THAT upset, as the frustration I encountered wasn't that frustrating or inconvenient.... Just can be frustrating sometimes dealing with some people who may sometimes not be knowledgeable even though they are supposed to know (with that, I'm referring mainly to my experience with Vanguard's "client transition division", or whatever the dept is called that helps heirs handle the accounts of a deceased Vanguard account holder).

[friar1610]

Quote:

Originally Posted by Gumby Let me offer a counter-example. Three years ago, the young wife and I took advantage of the 5 year 1.99% PenFed home equity loan to finance out of the last of our mortgage with a local bank. We found the process to be very smooth and uncomplicated, and the representatives I spoke to on the phone were knowledgeable and helpful. They appraised the house (even though the LTV was less than 15%), but we didn't pay for it. Nor did we pay any other closing fees. IIRC, they keep track of them, but waive them after a certain period. We also have PenFed credit card and have not experienced any problems with it.

Two years ago I wanted to get a HELOC on home A so I could purchase home B for cash even if home A hadn't sold yet. PenFed was a HELOC I was strongly considering, although I ended up going with another institution. When I was in the data collection phase trying to figure out which institution would lend me more money, have lower monthly payments, etc., I called PenFed several times to ask questions. They were very helpful and provided good information which helped me arrive at a decision.

I realize that is not the same as actually applying for the loan and perhaps if I had I would have a different opinion. But I was certainly pleased with the experience I had.

BTW, my decision not to go with them had to do with the fact that they did not offer "interest only" HELOCs whereas the other institution did. (As I mentioned, I was trying to keep the monthly payments as low as possible.

[Nords]

Followup:
After I started this rant, a couple of blogger buddies suggested that I should clean it up turn it into a post. One of them offered to run it on his site.

The newer post leaves out the details of the phone number update and the amount of the transfer, but it summarizes the rest of the transaction. We managed to sneak in a Pinterest-friendly image with the keyword "criminal".

Pentagon Federal Credit Union And Website Security Overseas - The Military Financial Planner

In four days I have another PenFed CD maturing. Hopefully I can move this money without a wire transfer... but just in case, I verified my Hawaii phone number and then set up my security code on their website. That part went fine.

[target2019]

My dealings with PENFED are pretty simple. Just have a small CD and credit card which I use for fuel, mainly.

I was late on my last payment, and I really can't come up with an explanation why. I think the payment dates are getting shorter. I called their CS number, and he was kinda confused, but eventually could understand the previous payment I made, and why I was confused.

Getting through their security minefield (I am in US) so I could talk with a CSR was disappointing. Their processes are flawed. I entered a security code at one point and it asked me for birth year. I entered all correctly, as I went on to the next prompt. I asked for balance, and it asked me for my security code and birth year again. Of course I flubbed the entry and had to talk with CS.

Good luck with your CDs.

[Nords]

More followup: PenFed's hypersecurity measures continue to ambush surprise me.

This is ludicrous. I feel as if I'm on random double-secret probation. I wouldn't mind these extra security precautions if I'd been notified of them when they were implemented, but I'm only learning about them when they pop up to tell me that I can't complete a transaction.

Frankly, they're dragging their feet and making it as difficult as possible for "my" money to leave their hands.

On 12 May, another $23K CD matured. (It didn't actually get to my PenFed share savings account until 13 May, but that's their rule.) I'm back home on Oahu, with my local phone number, and I wanted to do the usual transfer to my NFCU checking account. That ACH account link has been established for at least five years.

We've been home for almost a month, and I've logged on to my PenFed account at least a dozen time since then. But when I logged in yet again on 13 May to finally get this transfer started, the first thing I had to do was answer a security question and register my desktop computer. Maybe my IP address changed? Maybe my ISP did something? Maybe PenFed pops it up on every 13 logins? Anyway, my home PC is registered with PenFed's website. Again.

When I started the ACH transfer process, I knew I'd be limited to $5000. But sonofagun, when I clicked to confirm the transfer I was told to enter their security code from the text that they'd send me. In March I thought that was just a precaution for fund transfers from foreign countries, but maybe it applies to customers outside CONUS. My phone number in their records was correct, I clicked the "Get code" button, got the text, and did the transfer.

On 14 May I returned to do the next day's $5000 transfer. Here's the screen that tells you your limits:

Quote:

Step 1 of 3: Daily ACH Limit: $5,000.00 ACH Processed Today: $0.00 Max. Transfer Amt: $5,000.00

So I entered in the $5000 amount and got to the next step:

Quote:

Step 2 of 3 (titled "Review the transaction details and confirm your request by clicking SUBMIT)

I clicked, but instead of Step 3 I got a new window. I'll use the same text and color that PenFed uses. Because, you know, you might not be able to read it, let alone understand it, unless they're shouting at you in big red letters.

Quote:

YOUR REQUEST CANNOT BE PROCESSED. THERE IS A MAXIMUM LIMIT OF $5000.00 FOR AGGREGATE OUTBOUND ELECTRONIC (ACH) TRANSACTIONS IN A ROLLING 3 CALENDAR DAY PERIOD. OUR RECORDS INDICATE THAT THIS TRANSACTION EXCEEDS THAT LIMIT. PLEASE TRY YOUR TRANSACTION AGAIN LATER. (50538)

Yeah, I'd never heard of that limit before either. I've never had an e-mail or any other alert about it until I actually tried to touch my own money.

Just to be sure that I wasn't subject to some glitch from another limit, I tried doing a transfer on the 15th. Nope, same warning.

Fine, PenFed. I came back on this morning (the 16th, and day #3 since the last transfer) and put in the second $5000 transfer. That went through.

Since we're limited to one transfer every three days, I set up the rest of the $5K transfers and put them on their calendar in three-day increments. Ideally they'll do the ACH transfers on the 19th, 22nd, and 25th. (Even though the 25th is a federal holiday.) At least I could set them up all at once instead of logging in on each of those days.

But the process of transferring a $23K CD has now been stretched from its 12 May maturity to 25 May (plus a couple of ACH business days).

Security? Minimal cash reserves? They're not trying to upsell me a wire transfer fee, so that doesn't seem to be it.

I've had enough. Our final two CDs are maturing over the next 12 months. When they mature, I'm moving them to NFCU (or another high-yield credit union) and closing my PenFed account.

In retrospect, I'm really glad that I was never able to set up a PenFed conservator's account for my father. I have his CD ladders (at NFCU and USAA) set up to mature as his payments are due at his full-care facility, and these two-week delays in obtaining the funds would have been painful.

[brewer12345]

Um, Nords, maybe this is a stupid question, but:


Knowing you had a CD coming due, why didn't you log in ahead of time and opt to have them send you a check when the CD matured?

[audreyh1]

ACH transfer limits - from what I read these restrictions are on the PenFed initiated transfers.

I have been able to initiate much larger ACH transfers to PenFed from another institution. I hope I can handle the transfer out (pull) the same way after the CD matures.

[hellbender]

So many specific issues I don't know where to start. So I won't. In general though:

1. Slow/poor communications.
2. Loan processing delays
2. IT issues
3. Customer service personnel lying to me.

I currently have no checking and no outstanding loans with this outfit. As my CDs mature, I am moving the money out. Good riddance.

[Texas Proud]

Quote:

Originally Posted by audreyh1 ACH transfer limits - from what I read these restrictions are on the PenFed initiated transfers. I have been able to initiate much larger ACH transfers to PenFed from another institution. I hope I can handle the transfer out (pull) the same way after the CD matures.

Yes, this is a limit that is set up by PenFed.... also the three day period... nothing in the ACH system to restrict movement of cash...

Heck, I just moved $95K from Vanguard to my checking to help buy MIL a better condo... but my bank limited my wire transfers to $25K per day... charging a $40 fee for each

[target2019]

Quote:

Originally Posted by Nords We've been home for almost a month, and I've logged on to my PenFed account at least a dozen time since then. But when I logged in yet again on 13 May to finally get this transfer started, the first thing I had to do was answer a security question and register my desktop computer. Maybe my IP address changed? Maybe my ISP did something? Maybe PenFed pops it up on every 13 logins? Anyway, my home PC is registered with PenFed's website. Again.

Site security must change frequently to meet the evolving threats. Every time Firefox updates, for example, some financial sites challenge us in a different way. I think I'd be more miffed if I didn't see the site adapting.

[audreyh1]

Quote:

Originally Posted by Texas Proud Yes, this is a limit that is set up by PenFed.... also the three day period... nothing in the ACH system to restrict movement of cash... Heck, I just moved $95K from Vanguard to my checking to help buy MIL a better condo... but my bank limited my wire transfers to $25K per day... charging a $40 fee for each

You initiated the transfer from Vanguard, but your bank limited the size?

I've been able to transfer up to $100K to PenFed checking in one fell swoop, no fees, when initiated from my brokerage.

I was expecting that I could go the other way in big chunks. And from what I read PenFed doesn't place restrictions on transfers initiated from another institution because they aren't liable if it is later deemed fraud and has to be reversed.

[kaneohe]

Quote:

Originally Posted by brewer12345 Um, Nords, maybe this is a stupid question, but: Knowing you had a CD coming due, why didn't you log in ahead of time and opt to have them send you a check when the CD matured?

Or, if the proceeds could have been put in MMSA upon maturity, you could have written a check yourself........if a check would have useful. Then you wouldn't depend on anybody except yourself.