We have a Home Depot credit card we utilize extensively. When you own a marina and RV park there are no lack of things that need fixing and replacing. So we regularly take advantage of the 6mo and 12mo no interest promos. Of course, not paying interest requires you stay on top of it and make sure they are paid off. Usually, I stay a couple of months ahead of the due dates, writing a check for new purchases made and allocating a portion to the promotional balances. Now like most people, times are tight and I had a promo balance expiring in January. So I wrote my check and was a bit shocked when I received my statement saying I had been charged interest. Called HD (citibank) and had a long phone call with them. I was a bit suprised at what they told me so I decided to open a case with the Consumer Financial Protection Bureau.
Follow me below the tangled electric cord for the whole story.
Here is what I submitted:
Home Depot Credit Card. I always pay current balance off and put money toward the promotional balances. We use these promotions as a way to finance repairs/maintenance at our business so I've been playing this game for quite awhile. So I was quite suprised when I opened the bill today and see that I'm being assessed $6.79 in interest. After a long hold which involved a supervisor getting involved to figure it out. I was told the following: If the promotional balance due date is within 60 days, they apply payments as follows: In the 1st 30 days (of the 60) The payment satisifies the minimum payment and the rest is applied to the promotional balance. In the 2nd 30 days (of the 60) All of the payment goes to promotional balances. So this application method made current purchases into revolving balance accruing interest. I do not think this is fair and nowhere do I recall seeing that spelled out. At the moment, the customer rep tells me that I have a current revolving balance of 664.98 and she can't even adequately explain where it is coming from. So I will fix this by sending a check for 1300.00 to more than cover this balance and purchases and apply something to the next promotional balance which is due 7/1/2012. I think they need to make it clearer about this 60 day window thing. And frankly, I do not recall this happening before and we've been playing this game for a long time. I've got an entire years worth of statements in front of me. I would be more than willing to copy and send to you if need be.
Category: Billing statement
Make it clear on the stmt how payments will be applied. Your minimum payment due is $ Your current purchases are $ Any payments made will apply to promotional balance expiring xx/xx/xx prior to being applied to minimum payment and purchases.
I have removed personal info from the response..... and bolded the statute she mentions. Maybe somebody knows more about it.
Explanation of closure
Office of the President Home Depot Credit Services P.O. Box 9058 Gray, TN 37615 January 25, 2012
Dear Ms. xxxxxx: I am in receipt of your complaint forwarded to us by the Consumer Financial Protection Bureau. As a representative of Citibank’s Executive Office, I was given the opportunity to review and respond to your concerns regarding the billing of your Home Depot account. As reflected on your December 5, 2011 billing statement the New Balance of your account on that date was $3,854.94. Of this amount, $3,494.64 was the total of the Plan Balances for your promotional purchases and $360.30 was the total of your revolving credit purchases. As stated on this statement, the payment amount needed to avoid interest charges was $637.22. This amount represents the Plan Balance ($276.92) of the promotional purchase ending on January 1, 2012 and your revolving credit balance ($360.30). Our records indicate that your account was opened in July 2002 and we appreciate the manner in which you have handled your account. During each billing period, payments received are first applied to the minimum payment due for the account and then applied to promotional purchases ending within the current billing period and within the next one to two billing periods. This is consistent with recent revisions to Regulation Z that were part of the Credit CARD Act of 2009. While your payment was applied in this matter, the reason your account was billed an interest charge is because your payment in the amount of $550.00 was not large enough to cover both the revolving balance ($360.30) and the Plan Balance ($276.92) of the promotional purchase ending in the current period. As a gesture of goodwill, we have credited your account $6.79 for the billed interest charges. We received your payment in the amount of $1,300.00 on January 20, 2012. As of today’s date your account balance is $3,055.00 all of which is for promotional purchases. Please note on the first page of your billing statements a statement message provides you with the payment information needed to avoid interest charges. Thank you for bringing this matter to our attention and the opportunity to reply. Sincerely, xxxxxx,xxxxx Executive Response Unit
First, I am grateful they are crediting the interest. Second, it was a total of nine days till I got a response. So the moral of the story I suppose, is government can work for the people! And, if you play the promotional game, be aware of how the banksters apply your payments.
Updated to remove my surname from the response letter. Wasn't too concerned about the community here but didn't think about the fact it might get facebooked and tweeted. thanks Allison!