Credit Card Payment Applications

[jmca]

What is the name of your state? AL

Wasn't there a recent class action law suit regarding how the credit card companies can apply your payments to your account? I used one of those credit card debit checks to pay a bill. It was added to my credit card that already had a balance, but with a locked-in interest rate, and nothing currently being owed. The debit check is interest free until 12/06. I wanted to pay the debit check off prior to 12/06, but when I sent in the payment, the credit card company applied it to the rest of the balance. When I called to ask them about this, they said there was nothing they could do - that that's how the payment is credited. Is this true? Please advise. Thanks.What is the name of your state?

 

[efflandt]

Read your cardholder agreement. They can apply payments anyway they want to, whatever they feel is to "their" advantage. So make sure any account is paid in full before using a teaser check, and stash the card somewhere you will not accidently use it until the teaser balance is paid off.

Usually they credit any payments to whatever has the lowest interest rate, but maybe they feel it is to their advantage to pay down the fixed rate, so you end up paying full interest on your remaining 0% balance when that expires.