Consumer complaint received 2023-02-16
Company: WELLS FARGO & COMPANY
State: NC
Product: Credit card or prepaid card
Sub-product: Store credit card
Issue: Fees or interest
Sub-issue: Unexpected increase in interest rate

Complaint:
I am filing a complaint against Wells Fargo Bank for deceptive business practices and usury fees due to misapplied payments and lack of disclosure regarding promotional terms associated with promotional periods for purchases. On XX/XX/XXXX, I made a purchase at XXXX XXXX and financed this purchase through Wells Fargo Bank. I purchased a dining room table with four chairs, as well as a sofa. Due to the table being less than {$500.00}, the promotional period terms were 0 % interest if paid in full within six months. The sofa 's terms were 0 % interest if paid in full within 24 months. In total, the two items were {$4100.00}. My current balance is {$2900.00}. To date, I have made payments totaling {$1100.00}, making monthly payments on time and in excess of the minimum payment due. I recently began receiving notices from Wells Fargo informing that one of my promotional periods was ending and would be assessed an interest rate of 28.99 % from the date of purchase if I did not pay the item in full. 
On XX/XX/XXXX, I made a phone call to Wells Fargo Customer Service to inquire about this notice. I spoke with XXXX, who informed me that the promotional period for the dining room table was ending, and confirmed that I would owe the balance in full by XX/XX/XXXX or would be assessed the 28.99 % interest rate from date of purchase. She also informed that the balance due for the table by XX/XX/XXXX is {$490.00}. I discussed with her that I have paid more than the cost of the table and more than my minimum payment each month, so should not have a balance on this promotional term. XXXX stated that the payments get split between the promotional periods, and that if I wanted to have my payments applied to the shorter promotional period first, then I would need to specify that on my payment. I asked how a consumer would know to do this if this is not disclosed on the monthly statement and she could not answer. I stated to XXXX that I would like my payments to be reversed and then applied to the table first, paying off the table balance, and then apply the remainder to the sofa. XXXX put me on a brief hold and then told me that they can not reverse payments because my account would be sent to collections because it would appear as though I did not make my minimum payment. I was then transferred to another rep, XXXX. I restated my concerns to XXXX and again requested that my payments be reversed and applied to the shorter promotional period so that the table would be paid for, preventing the assessment of the 28.99 % interest charge from date of purchase. XXXX informed me they could not reverse payments. I asked XXXX how a consumer would know that payments were not being applied correctly, in order to remedy the situation before being assessed the high interest rate. XXXX told me that the breakdown was contained in the monthly statement. I informed XXXX that there was no such information contained in the monthly statement. I directed her attention to page XXXX of the monthly statement, which only indicates promotional terms for each purchase and the balance, but does not indicate how payments are applied so that the consumer knows to request the payments be applied in a different manner. XXXX then looked on page XXXX of the statement and acknowledged that it does not contain a breakdown of how payments are applied. Prior to hanging up on this call, I summarized my understanding of our discussion before I moved forward with filing a complaint. I summarized that payments can not be reversed and that Wells Fargo has indicated they do not have the ability to remedy this situation without me going outside of this agency. XXXX confirmed this information to be true. I then stated my awareness that Wells Fargo has been fined in the past for misapplying payments and incorrectly assessing interest, and that I will move forward with filing a complaint with the XXXX XXXX  The phone call was then terminated. Essentially, Wells Fargo misapplied payments and did not disclose this during the time of purchase or on monthly statements, resulting in an assessment of a 28.99 % interest rate.

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 monetary relief