If a debtor with multiple debts 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.

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This is known as the doctrine of appropriation of payments and is generally accepted in most legal systems. The creditor cannot apply the payment to a different debt unless the debtor gives express authorization or the debts are not clearly specified.

If a Debtor with Multiple Debts Specifies the Debt to Which