Even 1 Late Credit Card Payment Could Cost You More in 2019

Fee changes outlined in federal law might impact anyone with a credit card in the new year.

Even 1 Late Credit Card Payment Could Cost You More in 2019 Photo by Dean Drobot / Shutterstock.com

From Medicare deductibles to Amazon Prime memberships, many fees rise over time. And credit card late fees are no exception.

In fact, federal law allows for certain credit card costs to change as often as annually.

For 2019, the threshold for the following credit card fees will rise:

  • First late payment penalty: $28 — up $1 from 2018
  • Subsequent late payment penalty: $39 — up $1 from 2018

These changes take effect Jan. 1.

Why credit card fees rise

Under federal law, the U.S. Consumer Financial Protection Bureau (CFPB) calculates credit card late fee limits annually based on the Consumer Price Index, which serves as a measure of inflation. So, these limits can change as often as every year.

These limits apply to open-end consumer credit accounts, not credit accounts that are secured by a home.

Just note that the dollar amounts the CFPB sets for late payments are limitations: They represent the maximum amount that a credit card company can charge for such fees in the new year. So, it’s possible that your credit card company will not hike the amount it charges for these fees in 2019.

Avoiding credit card late fees

The only surefire way to avoid credit card late fees is to quit using credit cards — an impractical solution for many consumers.

The best practical preventive measure, then, is probably to set up automatic payments.

You should be able to do that by logging into your account online. But if you can’t figure it out, contact your credit card company’s customer service department.

When I log into my account, for example, I can choose one of three amounts to be paid automatically every month on my bill’s due date: the minimum payment, the statement balance or a dollar amount of my choice. Choosing even the minimum payment would be sufficient to avoid late fees.

Paying anything less than the full balance, however, generally results in interest charges. If you aren’t paying your credit card bills in full each month, you should consider transferring the balances to a no-interest credit card.

You can find and compare such cards using a free online resource like Money Talks News’ credit card search tool. Select “0% APR” or “Balance Transfer” from the menu on the left to view all cards with those features.

If you ever incur a late payment fee or other credit card fee, ask your credit card company if it will waive the fee. A 2017 CreditCards.com survey found that among cardholders who had asked for a waiver of a late payment fee, 87 percent received it, as we detailed in “4 Reasons You Should Call Your Credit Card Company Today.”

What’s your take on the rising thresholds for credit card late payment fees? Sound off below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Karla Bowsher
Karla Bowsher
I’m a freelance journalist and former newspaper reporter who has covered both personal and public finance. I've worked for a top 50 major metro daily and a community newspaper as well as ... More

Comments

958 Active Deals

More Deals