If you don't make your monthly payment on time, your credit card issuer will charge a late fee. Here's how you can get credit card late fees waived.
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Oscar Wong
When used responsibly, credit cards come with numerous benefits for borrowers. You'll receive additional protection against credit card fraud, and some cards come with cash back rewards. But if you miss a payment, you'll get hit with a late fee (although some credit cards don't charge late fees).
If you get stuck with a credit card late fee, Louis J. Schoeman, Director and Financial Expert at Forex Suggest, recommends trying to get it waived as soon as possible. He says that most credit card companies are surprisingly understanding. "In most cases, they will waive it if it's your first time," he explains.
Your credit card company issues a late fee if you can't make the minimum monthly payment by the due date. The exact fee depends on the card issuer, but most charge a flat fee.
A late fee will show up on your credit card statement the following month. The late fee increases your total balance, and you'll have to pay interest on that fee. Some credit card companies do offer grace periods, which is a timeframe within which the payment can be delayed without a late fee.
According to the Consumer Financial Protection Bureau, the average late fee is $26 per late payment. Late fees account for 99% of penalty fees and more than half of all consumer fees.
It's important to get in the habit of paying your bills on time because late payments can negatively impact you. "How late fees can affect you really depends on your circumstances and the agreement you have in place," says Schoeman.
If your payment is only one or two days late, you'll receive a late fee. Some credit card companies have tiered late fees, which means the fee is based on your balance. For instance, the first late fee could be $20, but subsequent late fees could increase.
If your payment is more than 30 days late, your credit card issuer will report the late payment to the major credit bureaus. Schoeman says your overall credit profile will determine how much it affects your credit score.
And if your payment is more than 60 days late, your credit card company may issue a penalty APR. For instance, if your regular APR is 18.24%, you could receive a penalty APR of 29.99%.
Schoeman says that one thing many people don't realize is that late payments can thwart any promotions you've received with the card. "This is especially important if you've acquired an interest-free credit card because one late payment can nullify that interest-free period."
Things happen, and even the most responsible borrower may occasionally make their credit card payment late. But depending on the circumstances, some credit card issuers will waive late fees. If you accidentally paid your credit card late and got hit with a late fee, here are some steps you can take.
If you've missed your payment, the first step you should take is to pay your bill immediately. Leaving your credit card bill unpaid for too long can damage your credit and cause more significant financial problems down the road. Plus, your issuer will be more willing to work with you if they can see you quickly took care of the problem.
Next, you want to verify that you did receive a late fee. You can check your credit card statement to see if your lender charged a late fee. You'll also be able to see if you received a penalty APR or lost access to any credit card rewards.
Schoeman recommends contacting your credit card issuer and explaining the situation. There are many scenarios where the late payment is understandable, and your credit card issuer may be willing to work with you.
"If you're self-employed and happened to get a late payment from a customer or you've been of ill health, the likelihood is that the credit card company will sympathize with you and waive any fees," he explains.
Apologize for the late fee, and explain why it happened. Make sure to highlight your history as a good customer and ask if they'll be willing to waive the fee.
Your credit card issuer may be willing to waive the late fee for a one-time occurrence. But they'll be less inclined to work with you if you routinely pay your bill late. Here are a few ways you can avoid credit card late fees going forward:
It's easy to forget your payment due date and pay your credit card bill late. Fortunately, if you have a history of on-time payments, you can contact your issuer and ask to receive a credit card late fee waiver.
However, you want to look for strategies to avoid late payments in the future. Reviewing your budget, adjusting your due date, and setting up autopay will help you avoid late fees and the financial consequences that come with them.
