A CareCredit lawsuit typically centers on one of two things: how the card’s deferred-interest promotions work, or the interest rate itself. Synchrony Bank, which issues the card, has faced a federal enforcement action that returned up to $34.1 million to consumers, a binding agreement with the New York Attorney General, and a 2024 class action alleging its 32.99% APR violates state usury laws. That class action was ordered into individual arbitration in early 2026.
Why CareCredit Keeps Getting Sued
CareCredit is a healthcare credit card accepted at medical, dental, veterinary, and wellness providers. Its signature feature, and the source of most litigation, is a “no interest if paid in full” promotion available for six, 12, 18, or 24 months on purchases of $200 or more.
The mechanic differs from a standard zero-percent introductory offer in a way most cardholders miss. On a typical zero-percent card, if you still owe money when the promo ends, interest applies only to the remaining balance going forward. On CareCredit, interest accrues silently across the entire promotional period. If any balance remains when the window closes, every dollar of that back-dated interest hits the account at once, calculated from the original purchase date.1NerdWallet. CareCredit Credit Card As of May 2024, the standard APR on new accounts is 32.99%, with a penalty rate of up to 39.99%.2CareCredit. Frequently Asked Questions
Between 2018 and 2020, consumers paid roughly $1 billion in deferred interest on healthcare credit card charges. A CFPB report found that 65% of medical credit card applications are signed inside a provider’s office, often while the patient is under stress and the provider is being paid upfront to promote the card.3Consumer Financial Protection Bureau. Medical Credit Cards and Financing Plans
The 2013 CFPB Enforcement Action
In December 2013, the Consumer Financial Protection Bureau ordered GE Capital Retail Bank, which then issued CareCredit, to refund up to $34.1 million to more than 1.2 million consumers. The agency called the enrollment practices deceptive.4Consumer Financial Protection Bureau. GE Capital Retail Bank and CareCredit Enforcement Action
The CFPB found that starting in January 2009, consumers were signed up at medical and dental offices without adequate explanation of the deferred-interest structure. Many believed they were getting a genuinely interest-free plan.5Consumer Financial Protection Bureau. Prepared Remarks of CFPB Director Richard Cordray on the CareCredit Enforcement Action
The consent order required CareCredit to call applicants within three days of signup to explain the terms, route transactions over $1,000 through a direct enrollment with a CareCredit representative, provide enhanced training to healthcare office staff, and issue warnings before promotional periods expired.5Consumer Financial Protection Bureau. Prepared Remarks of CFPB Director Richard Cordray on the CareCredit Enforcement Action The order has since been terminated.4Consumer Financial Protection Bureau. GE Capital Retail Bank and CareCredit Enforcement Action
The 2013 New York Attorney General Agreement
Six months earlier, in June 2013, the New York Attorney General concluded a parallel investigation with an Assurance of Discontinuance, a binding agreement to change practices without admitting or denying the findings.6Fierce Healthcare. CareCredit Settlement Promises Greater Consumer Protections, Transparency
The Attorney General found that CareCredit’s marketing materials were “lacking in significant respects,” that providers were charging large upfront fees for services not yet rendered, and that many consumers believed they had signed up for an in-house payment plan rather than a credit card.7New York Attorney General. Assurance of Discontinuance No. 12-103
The agreement imposed several changes. CareCredit was barred from paying rebates or other compensation to providers for generating card business. Consumers who applied inside a provider’s office got a three-day cooling-off period, with a $1,000 cap on same-day charges. Providers were prohibited from charging for services not yet completed unless the work was finished within 30 days. And New York consumers who had disputed charges between January 2008 and six months after the agreement’s effective date could appeal previously denied disputes, with successful claimants receiving reimbursement plus nine percent annual interest. CareCredit paid $125,000 toward the investigation’s costs and agreed to appoint a compliance officer.7New York Attorney General. Assurance of Discontinuance No. 12-103
S.G. v. Synchrony Bank: The 2024 Usury Class Action
The most recent major case is S.G. v. Synchrony Bank, Case No. 24-CV-5788, filed on August 19, 2024, in the U.S. District Court for the Eastern District of New York by the firm Pollock Cohen.8PACER Monitor. SG v. Synchrony Bank9Pollock Cohen. Consumer Files Class Action Against Synchrony Bank Over Medical Loans
The named plaintiff opened a CareCredit account in 2021 to pay about $2,000 for emergency veterinary care for his cat. According to the complaint, at CareCredit’s 32.99% interest rate, minimum payments would take 14 years to clear the debt and cost a total of $7,752.10The American Prospect. Predatory Lenders in the Operating Room
What the Lawsuit Alleged
The complaint alleged that CareCredit’s rate violates the usury laws of New York, Connecticut, and the District of Columbia. Under the applicable New York law, the maximum permitted rate for loans under $250,000 is 16%, less than half of CareCredit’s APR.11ClassAction.org. Synchrony Bank Facing Class Action Over Allegedly Illegal Interest Rates on CareCredit Accounts The suit also alleged unfair and deceptive business practices and breach of the covenant of good faith and fair dealing.12U.S. Courts. S.G. v. Synchrony Bank, 24-CV-5788
The proposed class covered all CareCredit accountholders nationwide who signed up through the CareCredit website and were charged interest above 16% per year during the statutory period. The amount in controversy was alleged to exceed $5 million.13ClassAction.org. S.G. v. Synchrony Bank Complaint
Sent to Individual Arbitration
Synchrony moved to compel individual arbitration under the arbitration clause and class-action waiver in the CareCredit cardholder agreement. That agreement sends most disputes to individual arbitration and bars class participation in court or in arbitration.14CareCredit. Your Terms
On January 27, 2026, Magistrate Judge Steven I. Locke recommended that the motion be granted, finding the arbitration agreement valid and enforceable as a “clickwrap” agreement and holding that whether the interest rates are actually usurious is a question for the arbitrator, not the court.15CaseMine. S.G. v. Synchrony Bank, 24-CV-5788 The plaintiff filed no objections. On March 25, 2026, District Judge Gary R. Brown adopted the recommendation in full, compelled arbitration, and stayed the case.8PACER Monitor. SG v. Synchrony Bank
The California Cross-Complaint
A separate case is moving in California. After Synchrony sued a consumer identified as “Venus” to collect $5,045.81 on a CareCredit debt, she filed a cross-complaint alleging that a dental office opened a $14,000 CareCredit line in her name without her knowledge or consent while she was incapacitated during a dental procedure, and that the office failed to bill her existing insurance. She is seeking two public injunctions: one against the dental provider, to stop it from applying for financial products on behalf of patients during treatment, and one against Synchrony, to stop it from marketing these products through California dental offices.10The American Prospect. Predatory Lenders in the Operating Room As of the most recent reporting, Synchrony had not responded to the cross-complaint.
The Arbitration Clause and the 45-Day Opt-Out
Because the cardholder agreement’s arbitration clause has now knocked the largest recent class action out of court, it matters for anyone considering the card. New cardholders have 45 days after opening an account to opt out of the arbitration provision by mailing written notice to Synchrony.16Synchrony Bank. CareCredit Credit Card Account Agreement Miss that window and any future dispute, including a claim that the interest rate is unlawful, will be handled individually before an arbitrator rather than through a court or a class action.