Credit card -- Fees or interest -- Complaint #9994775
USAA Accused of Violating Credit Card Act with Interest Rate Payment Practices
Complaint Overview
Complaint ID: 9994775
Company: United Services Automobile Association
Product: Credit card
Sub-Product: General-purpose credit card or charge card
Issue: Fees or interest
Sub-Issue: Charged too much interest
State: Maryland
ZIP Code: XXXXX
Date Received: 2024-08-31T12:00:00-05:00
Date Sent to Company: 2024-08-31T12:00:00-05:00
Company Response: Closed with explanation
Timely Response: Yes
Consumer Disputed: N/A
Submitted Via: Web
Risk Assessment
Risk Level: high
The consumer alleges USAA is not adhering to the Credit Card Act's payment allocation rules, potentially leading to excessive interest charges and violating consumer protection laws.
Consumer Sentiment: negative
Topics: Credit card fees, Interest rates, Credit Card Act
AI Analysis
CFPB complaint 9994775 was filed against UNITED SERVICES AUTOMOBILE ASSOCIATION regarding Credit card (General-purpose credit card or charge card), specifically about "Fees or interest". A consumer disputes USAA's practice of applying payments in a way that allegedly violates the Credit Card Act by not prioritizing higher interest rate balances. The complaint was received on August 31, 2024 from Maryland. The company responded with "Closed with explanation".
Consumer Narrative
XXXX XX/XX/XXXX : I contacted USAA to dispute their practice of burying a higher interest rate balance beneath a lower interest rate balance on my credit card in violation of the Credit Card Act of XXXX. USAA claims that because the balance was a cash advance, that they are not beholden to the rule of allowing consumers to pay off higher interest rate balances. USAA also opened a complaint for me XXXX.
What You Should Do -- Consumer Action Plan
Consumers should carefully review their credit card statements and payment allocation policies, especially for cash advances, and understand their rights under the Credit Card Act.
Legal Context & Consumer Protection Laws
The Credit Card Act of 2009 (CARD Act) aims to protect consumers by regulating credit card practices, including how payments are applied to balances with different interest rates.
Regulatory Insight
Regulators will likely examine whether USAA's payment allocation method for cash advances complies with the spirit and letter of the CARD Act, particularly regarding fair interest rate application.
Resolution Likelihood
likely
State-Specific Consumer Protections
Maryland law may offer additional consumer protections, but the primary dispute centers on federal credit card regulations.
Industry Comparison
Credit card companies generally must adhere to the CARD Act's payment allocation rules, though specific exceptions for certain transaction types like cash advances may exist and are subject to scrutiny.
Related Issues
Frequently Asked Questions
What is CFPB complaint 9994775 about?
CFPB complaint 9994775 involves Credit card (General-purpose credit card or charge card). The consumer reported an issue with "Fees or interest", specifically "Charged too much interest". This complaint was filed against UNITED SERVICES AUTOMOBILE ASSOCIATION on August 31, 2024.
Which company is complaint 9994775 filed against?
Complaint 9994775 was filed against UNITED SERVICES AUTOMOBILE ASSOCIATION. You can view all complaints against this company on their profile page at /company/united-services-automobile-association.
What was the company's response to complaint 9994775?
UNITED SERVICES AUTOMOBILE ASSOCIATION responded with "Closed with explanation". The response was marked as timely by the CFPB.
When was complaint 9994775 filed?
Complaint 9994775 was received by the CFPB on August 31, 2024. It was sent to UNITED SERVICES AUTOMOBILE ASSOCIATION on August 31, 2024.
What state was complaint 9994775 filed from?
Complaint 9994775 was filed from Maryland. You can view all complaints from this state at /state/MD.
Was the consumer satisfied with the resolution of complaint 9994775?
Dispute information is not available for complaint 9994775.
What product category is complaint 9994775 about?
Complaint 9994775 is categorized under "Credit card", specifically "General-purpose credit card or charge card". This is one of the product categories tracked by the CFPB.
How was complaint 9994775 submitted?
Complaint 9994775 was submitted via Web. The CFPB accepts complaints through web, phone, mail, email, fax, and referral channels.
What are the consumer's legal options for complaint 9994775?
The Credit Card Act of 2009 (CARD Act) aims to protect consumers by regulating credit card practices, including how payments are applied to balances with different interest rates. This relates to a Credit card complaint against UNITED SERVICES AUTOMOBILE ASSOCIATION involving "Fees or interest".
How likely is complaint 9994775 to be resolved?
Resolution likelihood: likely. The company's current response is "Closed with explanation". The company did respond in a timely manner, which is a positive indicator.
What does the risk level mean for complaint 9994775?
This complaint is rated as high risk. The consumer alleges USAA is not adhering to the Credit Card Act's payment allocation rules, potentially leading to excessive interest charges and violating consumer protection laws.
What regulatory actions apply to complaint 9994775?
Regulators will likely examine whether USAA's payment allocation method for cash advances complies with the spirit and letter of the CARD Act, particularly regarding fair interest rate application. The CFPB tracks complaints like this one to identify patterns of misconduct across the Credit card industry.
What should the consumer do about complaint 9994775?
Consumers should carefully review their credit card statements and payment allocation policies, especially for cash advances, and understand their rights under the Credit Card Act.
Are there state-specific protections for complaint 9994775?
Maryland law may offer additional consumer protections, but the primary dispute centers on federal credit card regulations. This complaint was filed from Maryland.
How does complaint 9994775 compare to industry norms?
Credit card companies generally must adhere to the CARD Act's payment allocation rules, though specific exceptions for certain transaction types like cash advances may exist and are subject to scrutiny.
Does the Credit Card Act of 2009 mandate specific payment allocation rules for cash advances, or are there exceptions that allow creditors to apply payments differently?
The CARD Act generally requires payments above the minimum to be applied to balances with the highest interest rates first. However, specific rules and potential exceptions for certain transaction types like cash advances are complex and may be subject to interpretation and regulatory guidance.
Disclaimer
This analysis is AI-generated and does not constitute legal advice.