Under an open-end credit plan—such as a credit card account / home equity line of credit / personal lines of credit—Federal law does not govern the application of payments. Generally, banks apply payments to the portion of the balance with the lowest annual percentage rate (APR) until that balance is zero. Payments then are applied to the remaining balance. The Account Agreement discloses how the bank will handle the application of payments. You should have received a copy of this agreement when you opened the account.