Consumer complaint received 2023-01-28
Company: SYNCHRONY FINANCIAL
State: WA
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Other features, terms, or problems
Sub-issue: Other problem

Complaint:
I currently have a Synchrony Care Credit Mastercard. I utilize this a lot to pay for my dogs veterinarian bills and since my charges are pretty high, I take advantage of the 6 months no interest promotions. I am having an issue with how my payments are being allocated to my balance. I have a mix of charges at the XXXX interest rate, as well as the standard rate. When I received my statement for XXXX, I noticed that XXXX large payments I made, XXXX for {$700.00} and XXXX for {$1500.00} did not get applied to promotional balances that expire on XX/XX/23. I reviewed my statement for how payments are applied, and there was no mention of that specifically, but it did say I could call to have my payment allocation changed. So, on XX/XX/23 I call and the representative was very nice and said he would take care of adjusting the allocation and that it may take up to 72 hours. No mention that they actually would not be able to help me with that. On XX/XX/23, I received a letter from Synchrony stating that due to federal regulation they can not adjust my allocation unless it is in the last two billing cycles before expiration ( my payments would have been the third one prior to expiration ). Having worked in compliance and audit for financial institutions, I thought that this did not sound quite right to me. I pulled up 12 CFR Part 1026.53, Allocation of Payments, to see exactly what the regulation says. While it does mention the two billing cycle exception, it is also acceptable to change the allocation at consumer request. I understand the regulation does not require the issuer to honor this exception, but in not honoring it, there is a high probability that I will be paying more interest in the end since my payments will never be applied to my promotional balances ( depending on my purchases under the standard rate ) and I will end up paying the accrued interest. This just screams UDAAP violation to me.

I understand the intention of this regulation is for the higher interest balances to be paid off first, which I support, but in the situation of the XXXX interest promotions, I should get to choose how I want my payments applied. In fact, I assumed this was standard, as I am able to go online to my XXXX XXXX Credit Card and specify which promotional balance I would like the excess of my minimum payment to go to. 

My other issue is, in reading the payment disclosures on my statement and in my cardholder agreement, no where ( that I can find ) does it state how payments are applied to promotional balances. Even the phone rep I talked to did not explain the policy to me. Had I known about the exception for the XXXX billing cycles prior, I would have saved my XXXX larger payments in XXXX for XXXX when the exception would be in effect.

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