Consumer complaint received 2017-12-15
Company: Bread Financial Holdings, Inc.
State: FL
Product: Credit card or prepaid card
Sub-product: Store credit card
Issue: Advertising and marketing, including promotional offers
Sub-issue: Confusing or misleading advertising about the credit card

Complaint:
I have an XXXX credit card, operated by XXXX. The card occasionally offers promotional interest-free options. I have taken part in three promotional offers. The problem is the allocation of my payments. I have contacted customer service on a minimum of 4 occasions since XXXX to get some idea of how my payments are allocated, but was never able to get an answer. 

The problem is that one of the promotional balances had to be paid in full this month, and three promos do not have to be paid in full for several more months ( end of XXXX and midXXXX ). Each month a different amount is chosen for each of the promotional balances, and I have no idea how that is calculated. Because they will not advise how they are allocating payments ( and because I 'm suffering a financial hardship ), the promotional balance that needed to be paid this month did not get paid in full. I 'm unsure at this time just how much interest I will be penalized with. 

- The balance started out as {$300.00} on XXXX/XXXX/XXXX, and had to be paid in full by XXXX/XXXX/XXXX to avoid accrued interest. 
- In XXXX, no part of my payment was allocated to the new balance. ( Not surprising. ) - In XXXX, {$16.00} of my {$96.00} minimum payment was allocated to the balance. 
- In XXXX, {$15.00} of my {$96.00} payment was allocated to the balance ( however, I did not notice that my minimum payment had increased to {$100.00} - totally my fault ). I contacted them, and they removed the late fee. This is also when I started asking for an explanation of how allocations are calculated. 
- In XXXX, I returned a couple of the items - making the overall balance {$250.00} instead of the original {$300.00}. That month, it looks like {$73.00} of my {$350.00} payment ( {$77.00} min ) went to that balance ( on this statement I also guess that some part of my payment went towards a non-promotional balance incurred in XXXX ). I still have n't fully determined exactly how all the figures on that statement fit together. I asked again for an explanation of how payments are allocated, and again got a response that provided no helpful information ( See the quoted response later in this statement. ) - In XXXX, {$41.00} of my {$110.00} payment ( {$72.00} min ) went to the XXXX promo balance. 
- In XXXX, {$44.00} of my {$110.00} payment ( {$66.00} min ) went to the XXXX promo balance. 
- In XXXX, the statement is more confusing than usual, but it looks like maybe only {$5.00} of my {$66.00} minimum payment went to the XXXX promo balance. It does n't look like they have assessed the accrued interest yet, but there are always things on their statements that I ca n't figure out. 

I 've been trying to get direction from them since XXXX so I could have avoided the interest penalty, but they were never able to tell me how they allocate funds. One response ( in XXXX ) included the following verbiage : " First, your payment gets applied to all unpaid fees that may be a part of your overall balance, and your scheduled payment. Then we apply the additional amount you paid to any balance being assessed interest. We credit the balance with the highest APR first, followed by promotional plan balances with the oldest end date. However, if you have a promotional plan ending within the next 2 billing cycles accruing interest, we will apply any amount paid above your minimum due to that plan first. '' - I understand that they would pay fees first, and that could certainly be accurate. 
- Then it looks like the rep then says that after those fees are paid that the payment gets applied to my " scheduled payment. '' I ca n't understand what that means. 
- All of my promos are subject to the same interest rate, so the next statement is not applicable in my case. 
- I 'm unsure what is meant by " oldest end date, '' but some portion of all of my payments went to 4 of my promos each month regardless of end date. 
- Lastly, the rep says that if I have a promotional plan accruing interest ending in the next 2 billing cycles that any amount above my minimum payment will go there first, but fails to advise that little or none of the minimum payment will go toward that balance. 

I ca n't figure out how anyone without a degree in advanced accounting could figure this out and abide. I guess the only way would have been to pay all of them in full this month ; but that defeats the purpose of my taking the promotion in the first place. I feel like there should be clear and advertised methods for determining payment allocation.

Company response to consumer: Closed with explanation