Credit Card Late Fees

Since the time credit cards entered the lives of people, many cardholders tend to spend more than they expect or can afford to spend. Consequently, in most cases, people end up with paying less than what they have spent throughout the months or worse, do not pay the bills at all. Non-payments of the credit card bills on time incur late fees. Late fees have been an issue with the cardholders for a long time. They do not even realize how much they have spent. At times, they are left with no resource also to pay the bills later. This situation may even cause more late fees resulting in a dent of the credit scores.

What is a credit card late fee?

A late fee is an additional fee charged by the credit card companies, according to their company guidelines, for a non-payment of the credit card bills or paying less than what is due on the credit card statement. Payment due dates are marked in the credit card statements/ bills. Being aware of your monthly due dates, at your own interest, is very crucial which in return may help you save some money.

At present, some credit issuers charge late fees as high as $40.00. This may be as per their company rules. Besides, the Fair Credit Billing Act (FCBA) allows the credit card issuers to formulate their own credit card policy, in accordance with FCBA guidelines. Therefore, it is not the time to be sluggish with your card bills.

How do late fees affect you?

When you are unable to make your credit card payments by the specified due dates, you will be charged with a late fee. Assessment of late fees will be marked by your issuers, which, in result, will harm your credit score negatively. If you plan to get a new loan or decide to possess a new credit card, either your application may be turned down on grounds of your low credit scores or you will get a card with higher interest charges because of your late fee history. Hence, make sure you do not default any payment on your credit card bills and pay the required amount by the due date.

How can you avoid Late Fees?

The best way to avoid a late is to pay the bills on time. If you opt to snail-mail your payments, you should send the payments way before your due date. Remember, you may not be sure of any postal delay of your payment processing. Therefore, it will be judicious to send the payments at least 10 days in advance. Make at least the minimum payment by the due date. You will not be charged with a late fee. In case you have an issue to pay your bills by the specified due date, ask your bank to change the due date. Just remember, you are liable to clear your current monthly bill by the current due date and then your new due date will be effective. You may also set an Automatic Payment Deduction Plan with your issuers. Most major issuers accept online payments through Auto-Deduct plan. Just make sure you keep sufficient funds in your bank accounts, otherwise you will be levied with a non-sufficient fund fee as well along with a late fee. Pay-by-phone is also available with some credit card issuers. You need to have a checking account or a savings account for this. Some issuers charge a phone fee. Always ask them before you pay. While calling to make a payment on phone, you need to provide the customer care executives with your checking account number and the routing number, which appear at the bottom of your check. Get the payment confirmation number after the payment is posted. You can also post-date your payments through the phone payments.

Finally, if you are charged with a late fee, you can ask your issuer to get the fee waived, provided you maintain your account in a satisfactory manner during a 12-month period. Most of the issuers will waive the fee as a courtesy because of your good payment history. Hence, enjoy your credit and do not be late. Make due payments on time and relax. This will also help gain more credit in future. All the best.