Consumer complaint received 2023-06-12
Company: BANK OF AMERICA, NATIONAL ASSOCIATION
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Fees or interest
Sub-issue: Charged too much interest

Complaint:
We have been Bank of America customers since XXXX. We are XXXX XXXX living permanently in XXXX, however we also own a vacation property in XXXX, California that we spend the winters at. In XXXX XXXX  XXXX we met with a Credit Specialist at the Branch in XXXX  XXXX, California. We were wanting to arrange a line of credit or small personal loan as we were replacing the HVAC unit in the home and required approximately {$8000.00}. During our meeting with XXXX XXXX the credit XXXX, he advised that Bank of America does not offer XXXX XXXX XXXX or small personal loans. He did mention that their XXXX card had a promotion attached to it for qualified Clients. He proceeded to check our account and found that we did qualify for the promotion that gave us 0 % interest for 18 months. I asked him how it worked and he advised us that the amount is taken as a direct deposit advance and would show separately on our statement. While purchases would show as purchases. 
I asked how the payments would work as this was our operating account thru which we ran our everyday purchases. XXXX told us that as long as we continued to payoff the monthly purchases it would be fine and anything above that would be applied to the direct deposit advance if we wanted to start reducing the balance of it. XXXX also let us now that there was a 3 % transaction fee that would be collected at the time we took the advance. We thank him for the info and said we wanted to discuss it overnight. After thinking about it and feeling comfortable that we were given the correct and accurate information by XXXX, we went back the next day to put the arrangements in play. During this meeting again I went over the matter of paying off the monthly purchase charges ( which is supported by our account history of being the practice on this card since inception ) so as to avoid any interest charges. XXXX assured me that as along as I paid the purchases on the card during the statement cycle I would be fine. We went ahead with the direct deposit advance signing the paperwork and being given copies of it along with the disclosure statements. I have to admit that I didn't look very closely at the statements only to find the amount of purchases charged for the next couple of months as we were very busy and I had a level of Trust with the Bank of America. In XXXX I actually had some time to sit down and review the statements and was shocked and dismayed to see that interest was being charged on the account at a rate of 24.99 %. I called XXXX right away and explained my plight to him, he just said I couldn't paid off the right amount, he recommended I call the XXXX XXXX and speak to them as he didn't have the full access to our account that they did and they could help sort out the issue. I called them a couple of times and was left on hold for a significant period and then I hung up tried again and the same thing happened. We then were preparing to begin the trip home to XXXX and I left it until we got there and resettled. In XXXX I contacted XXXX again saying I was still having trouble and couldn't understand why this was happening when I was paying off the purchases as required. Again he passed the me back onto XXXX. I called and finally got to speak to a Representative by the name of XXXX, she took the time to listen to my dilema and brought my account up so she could see what was going on. XXXX went thru how the XXXX worked in details and explained clearly why we were being charged interest. It seems that payments to the account are applied as follows, the statement minimum payment amount is applied to the LOWEST interest rate portion and the remainder of the payment it them applied to the higher interest rate portion. So in effect if I made a payment of {$1700.00} to cover purchases made during the month but a minimum payment amount of {$150.00} was required that minimum pay't of {$150.00} was taken off the {$1700.00}. leaving me short of clearing my balance by that amount and therefore interest of 24.99 % would be charged on the full amount from the date of transaction. XXXX also explained that as the direct deposit amount remained outstanding This was not explained to me at all when we spoke with the Branch Specialist, why would we agree to doing this and paying that exorbitant rate of interest if we were made aware of how it was going to work. XXXX even stated to me that when they offer this product to their Clients they recommend that they use an alternate Vise card for everyday expenses while the Direct deposit amount remains outstanding so not to incur huge interest costs, even offering to qualify the client for another card if they don't have one available. 
The fact of the matter is, the product was not explained properly or in appropriate detail during our Branch meetings or calls and it is most likely that the Specialist recommending this product was financially compensated for selling us a product that did not in fact meet our needs. Given we are snowbirds owning outright our permanent home in XXXX and our Winter home in XXXX, with sufficient income to enjoy same along with an excellent credit history, why would we knowingly accept a product that we would be paying 24.99 % annually. When it was our understanding the only cost would be the 3 % transaction fee. It is for the foregoing reasons we are of the opinion the the Bank of America has not acted in good faith or with good Business Practices in regards to the operation of their VISA accounts.

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