If a debtor specifies the debt to which a payment is to be applied and the creditor accepts the money, the creditor is bound to apply the money as specified; therefore, if a debtor specifies that a payment is to be made for a current purchase, the creditor may not apply the payment to an older balance.

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This is known as the "earmarking doctrine" and is recognized in most jurisdictions. It ensures that the debtor's payment is applied as intended and prevents the creditor from manipulating the payment allocation to their advantage.

If a Debtor Specifies the Debt to Which a Payment