Consumer complaint received 2025-11-18 00:00:00
Product: Credit card — Store credit card
Issue: Fees or interest — Unexpected increase in interest rate
Company: Bread Financial Holdings, Inc.
State: NY

Complaint narrative:
I am filing a complaint against Comenity Capital Bank regarding deceptive deferred-interest financing, improper retroactive interest charges, and violations of the Truth in Lending Act ( TILA ) and Regulation Z arising from my Zales credit card account ( Account ending XXXX ). 

On XX/XX/XXXX, I made a purchase at Zales, and the sales associate enrolled me in an 18-Month Deferred Interest Payment Required promotional credit plan offered through Comenity Capital Bank . At the point of sale, the associate described the plan as no interest as long as I made the required payments. At no time did the associate verbally disclose that : Minimum payments would not satisfy the promotional payoff requirement ; The full promotional balance had to be paid by XX/XX/XXXX ; Interest would be accruing from the date of purchase at an APR exceeding 31 % and would be retroactively added in full if the promotional balance was not paid off in time ; Failure to pay in full would cause substantial finance charges to be added all at once ; The plan was a deferred interest loan, not a true 0 % APR promotion.

Throughout the promotional period, every statement reflected {$0.00} in interest, which created the reasonable belief that I was in compliance with the terms of the promotion. My account was also placed on automatic monthly payments by Comenity, reinforcing the impression that I was meeting all requirements. 

Then, immediately after the promotional expiration on XX/XX/XXXX, Comenity unexpectedly added more than {$1700.00} in retroactive Interest Charge on Purchases, representing interest accrued from the entire 18-month period. Following this, Comenity continued to charge more than {$90.00} per month in additional interest at an APR over 31 %, causing my XXXX  year-to-date interest charges to exceed {$2200.00} as reflected in the XX/XX/XXXX statement. 

This is unfair, deceptive, and predatory, and Comenitys practices violate both TILA and Regulation Z, specifically : Failure to provide clear and conspicuous disclosure of the deferred-interest terms, as required under 12 C.F.R. 1026.16 and 1026.24 ; Misrepresentation and omission of material terms by the merchant at the point of sale ; Confusing or misleading statements during the promotional period, including repeated display of {$0.00} interest and no warning that minimum payments were insufficient ; Improper retroactive imposition of interest contrary to the consumers reasonable understanding of the promotional plan ; Failure to properly disclose the consequences of promotional expiration and the amount of accrued interest ; Failure to adequately warn the consumer before imposing a massive retroactive interest charge ; Potential violation of the Fair Credit Billing Act, as the sudden interest assessment is a billing error not properly explained or supported by documentation. 

My account statements never clearly disclosed that minimum payments would not satisfy the promotional terms, and the sudden imposition of thousands of dollars in interest was entirely unexpected and financially harmful.

Company response to consumer: Closed with explanation