Patent ID: 8620786

Claim:
A computer-implemented method of prioritized processing of payments from a payor, the prioritized processing performed by at least one computer processor, the method comprising: establishing a plurality of payment source options, the payment source options including multiple types of source accounts; facilitating communication over a network between the payor and a payee or payment administrator; establishing over the network through communication between a mobile device and the at least one computer processor, priority rules for prioritizing the payment source options for payment of a bill from the payee, wherein each of said types of source accounts is selectable as a primary payment source having a first priority and a secondary payment source having a second priority to be usable for future payments from the payor; selecting, through communication with the at least one computer processor, charge distribution rules for distributing a payment across at least two of the prioritized plurality of payment source options according to the priority rules, wherein at least one of the charge distribution rules requires distributing the payment across multiple payment source options even when the primary payment source has sufficient funds to satisfy a payment due and the charge distribution rules provide (a) a lock-out date or window on which no transaction can be submitted against at least one specified payment source, or (b) a minimum payment date or window on which a transaction exceeding a calculated amount that depletes funds in the at least one specified payment source beyond a predetermined balance is not to be submitted against the at least one specified payment source; storing the established priority rules and charge distribution rules in a database for payment of at least one recurring bill to the payee; identifying the payment due for the payee; submitting, by the payee or payment administrator, a transaction against the prioritized plurality of payment sources; and processing the transaction, using the at least one computer processor, against the prioritized plurality of payment sources in the order of their priority, as set forth by priority rules and the charge distribution rules stored in the database for the recurring bill from the payee and accessible to the at least one computer processor, until one of said payment source options satisfies the payment due, wherein the transition from one payment source to another is automatically executed by the at least one computer processor accessing the database and executing payment in accordance with the priority rules and charge distribution rules; thereby providing a waterfall payment process enabling a payment due from a payor to be satisfied for a payee using a plurality of prioritized payment sources.