Are there any requirements for crediting payments on a closed-end credit? I am not seeing anything. I know 1026.10 addresses payment crediting for Open-end credit (ex: must be applied on date received), but we are having issues with our system crediting a payment correctly if the customer pays a day or two before the new month. Accounting wants to apply the payment as of the first of the month.
Our note reads, “Each monthly payment will be applied as of its schedled due date and will be applied to interest before principal.” Do you see any issue in applying payment as of (example 6/1 if payment is received on 5/28)–when it clearly is just the next month’s payments, as opposed to additional principal.
Thank you, Robin. Yes. I was aware of those changes. We have recently switched processing methods and were unsure how much manual involvement would be required to make this scenario work. I was trying to buy time until January to insure it was working properly. We confirmed last week that the system can handle these payments/subsequnet billing correctly.