When Can You Be Charged a Late Fee?

When Is a Credit Card Payment Considered Late?

A payment is considered late if it does not arrive by the due date and time indicated on your credit card statement, unless that date falls on a holiday or weekend.

A late payment can result in late fees, penalty interest rates and damage to your credit score. The later the payment is, the greater its potential impact.

Here are some possible consequences if you don't make a credit card payment on time:

• 1 to 29 days late: Card issuer can charge a late fee.
• 30 to 59 days late: Card issuer can report the account as 30 days delinquent to credit bureaus.
• 60 days late: Card issuer might impose a penalty interest rate that applies to your card's current balance.
• 90, 120 and 150 days late: Card issuer continues to charge interest and report late payment.
• 180 or more days late: Card issuer may close your account if it has not already done so, charge off the account or send it to a collection agency.

How Do Credit Card Late Fees Work?

Late fees are typically explained in your credit card's terms and conditions. In general, they may be charged if your payment is late or you paid less than the minimum. If a late fee is charged, you will probably receive a notice from the issuer. The amount charged may depend partly on how much you owe, your payment history and the issuer's limits on how much can be charged, regardless of how late the payment is. Fees may also be higher if you are repeatedly late.

How Much Are Late Fees?

According to the Consumer Financial Protection Bureau (CFPB), the typical credit card late fee is about $32. The CFPB recently capped late fees at $8, but that move is yet to go into effect and is currently facing legal challenges. For now, consumers should assume the fees listed on their credit card terms and conditions are the ones that they will pay if they pay credit card bills late.

Can You Get a Credit Card Late Fee Waived?

You may be able to get a late fee waived. If you're late with a payment, make at least the minimum payment and then contact the issuing bank to see whether you can get the fee waived. Be prepared to:

• Explain why the payment was late
• Outline steps you are taking to prevent this from happening again
• Reference your payment history if you have a solid record of on-time payments
• Mention how long you have been a customer if you're a longtime, loyal customer

Banks can and do consider unique circumstances and might be willing to waive or refund fees. Asking politely can't hurt.

How Does a Late Payment Affect Your Credit?

A payment that is less than 30 days late does not appear on your credit reports, so it won't affect your credit scores. However, late payments that are less than 30 days late can result in late fees, which add to the balances you owe and can make it harder to pay all your bills. And payments that are at least 30 days late can be reported to credit bureaus. Those late payments can potentially damage your credit scores since payment history is the most important factor in calculating credit scores.

What to Do if You Miss a Credit Card Payment

If you miss a credit card payment, try to pay at least the minimum amount due to bring the account current. Then, if you think you have a case for asking the issuer to waive the fees, contact them.

If you cannot pay your credit card bill, contact your credit card issuer. Be ready to describe the issue that caused your shortfall and to propose a plan for repayment. If you're able to agree on a workable payment plan, get it in writing. If your financial situation doesn't look like it is going to improve in the foreseeable future, consider getting help from a credit counselor.

The best way to avoid late fees, though, is to take actions so you won't incur them. Your choices include:

• Setting up autopay to cover your minimum payment: You can manually change it to pay the full amount due, or you can make a second payment to cover the balance, but the autopay will ensure you won't pay a late fee.
• Setting up payment alerts: Most credit card issuers will send you email or text alerts to help you stay on top of payments
• Choosing a credit card without late fees: A few credit cards do not charge late fees. Be aware, though, that not charging late fees does not mean that your account will not be reported as late to credit bureaus if you pay at least 30 days late.

The Bottom Line

Credit cards can charge a late fee if they receive your payment after it's due. That's true even if you mailed it on time and the payment was slow in getting delivered. Automatic or electronic payments can assure that payments arrive in time to avoid late fees.

If you have a history of on-time payments or a very good explanation of why your payment was late and a solid plan for avoiding it in the future, you may be able to get your credit card issuer to waive the fee.

However, fees and penalty interest rates may not be the costliest consequence of paying late. A missed payment (one that is at least 30 days late) can be reported to credit bureaus and result in lower credit scores. You can check your own credit report and score through Experian for free.

If you are charged a late fee but make a payment before you are 30 days late, you won't see it on your credit report. If you do have late payments on your credit report, you can make sure those are accurate and take actions to avoid them going forward.