Consumer complaint received 2022-04-15
Company: SYNCHRONY FINANCIAL
State: GA
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Problem when making payments
Sub-issue: Problem during payment process

Complaint:
CareCredit card ; a feature of the card is promotional purchases, which defer a high rate of interest ( 26 % + ) for a set amount of time ( example : 12 months ), and if the amount is paid in full before the promo period expires, the interest is waived ( leaving you having paid 0 % interest ). 

Prior to XX/XX/2022, if you made the minimum payment for the month, it would be applied to the soonest-expiring promotional balance on your account. So, for example, if you had promo balances expiring in XX/XX/2022, XX/XX/2022, and XX/XX/2022, a payment you made would be applied in full to the XX/XX/2022 promo balance. If the payment was bigger than the total amount of the XX/XX/2022 balance, the remainder would then be applied to the XX/XX/2022 promo balance, and so on. 

In XX/XX/2022 CareCredit made some sort of change to, instead of applying your payment to the soonest-expiring promo balance, " skip one '' and apply it to the next promo balance after. But they didn't tell anyone that they were doing this. Their representatives say " they can not tell you why '' their system is doing this. 

So in the example, your payments would all go to the XX/XX/2022 promo balance, and as a consequence you would " fail '' to pay off the XX/XX/2022 promo balance. As a result of that, the 26 % + interest on that XX/XX/2022 balance that had been accumulating **since its original purchase date** would be added to your account balance, as a non-promotional amount that in turn begins capitalizing more interest atop it at that same 26 % +. 

This change in payment application is not disclosed to the debtor at all. Further, this change is not visible to the customer unless they are cross-checking every payment to try to figure out how CareCredit applied it. 

This has been done with to 3 payments in a row that I have made since XX/XX/2022. I have had my account for years and can speak authoritatively to the fact that this is new behavior. 

When talking to CareCredit on the phone, including manager escalation, they have alternately said that : ( a ) the only way to ensure that your payment is made to the soonest-expiring promo balance is to phone in after making the payment in order to have it reallocated from wherever they applied it to, or ( b ) that how payments are applied is complex and unpredictable. 
( a ) may be true as of XX/XX/2022, but ( b ) is absolutely false -- again, I have had my account for many years, and I am well-versed in how application of credit card payments works and why -- not a novice here. Until XX/XX/2022, payments were always applied -- in full -- to the soonest-expiring promotional balance. 

Phone representatives do not take this seriously and either shrug off the issue or give you the runaround, offering only, when pressed, that they will reallocate a payment you just made to the soonest-expiring promo balance, but you have to call in to ask them to do so. 

This is a pretty clear racket to trap debtors into " failing '' to pay off their promo balances before they expire, at which time it will be the " debtor 's fault '' that they " now owe '' the accumulated interest due to the " failure. ''

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation