Paying a credit card late fee is the same as throwing your money away. Late credit card payments can also hurt your credit score. The payment tips and strategies here will show you how to prevent these costly fees.
When credit card companies process credit card payments, every single detail is extremely important. Get even one of these small details wrong and you will have to pay credit card late fees.
The Fair Credit Billing Act requires credit card companies to credit payments the day they are received. However, this law also allows each credit card issuer to set their own specific payment guidelines. If any of these guidelines are not met, the credit card company can take as much as five days to credit the payment.
That means you can get your payment to your credit card company on time and it could become late during that five-day period. The credit card company could legally charge you credit card late fees. So it’s in your best interest to follow their payment guidelines carefully. The payment guidelines are usually on the back of your credit card bill.
Here is the five best ways to prevent credit card late fees.
1. Follow Credit Card Payment Guidelines Carefully
This includes everything from a specific payment address to the time of day the payment has to be received to be credited that day. Some companies even require that payments arrive in their preprinted envelope they sent you with your bill. To be safe, always use the preprinted envelope provided by a credit card company.
Include the billing coupon, and write the amount you are paying in the box provided. Make your check legible, don’t forget to sign it and double check that the payment amount is correct. Write your credit card account number on your check and send the payment with the proper postage to the payment address requested by the credit card company.
2 Pay The Minimum Payment Immediately
The best way to prevent paying a credit card late fee is to pay your bill as soon as it arrives. Even if you can only make the minimum payment, it’s better than paying a late credit card payment. You can always make additional payments later to keep your interest costs down.
3 Change Your Due Date
Most major credit card companies allow you set your own due date by just asking. Set your due date so your credit card bill arrives right after you get paid.
4 Automatic Online Payments
Paying bills online is also another good way to avoid paying a credit card late fee. Most major credit card companies are accepting credit card payments online. Just sign up for the service on the card company’s web site. Make sure to choose a payment amount that automatically covers the minimum amount due on your credit card each month. You can always make additional payments later to keep your interest costs down.
5 Make Your Payment By Phone
Most major credit card companies will accept payments by phone. Some of them will charge fees, ranging from $5 to $15 for the service. But credit card late fees cost you much more so it’s better to pay the small fee than a late credit card payment fee. Call the toll-free number on the back of your credit card. They will ask you for a check number and the bank routing number, which is printed at the bottom of every check.
If you do get hit with a credit card late fee, try calling the credit card company and ask if they will waive it. Many credit card companies will waive late credit card payment fees as a courtesy to customers with good payment records.
Copyright © 2005 Credit Repair Facts.com All Rights Reserved.
Don’t choose a card just because it offers a zero annual fee. With the exception of airline, poor credit and charge cards, almost all credit cards offer a zero annual fee these days. Credit card issuers know that a zero annual fee is a big selling point with consumers. Competition among card issuers demands a zero annual fee, so rarely will you find a credit card with an annual fee anymore. This doesn’t mean you should reject a card because it comes with a fee. For example, airline cards almost always charge a fee to defray the cost of administering the frequent flier programs.
Don’t choose a credit card just because it has a low introductory rate. Credit card issuers know that low and zero introductory rates are big selling tools because consumers love them. That’s why more and more card issuers offer a special introductory rate or “teaser” rate. What is nice for the consumers is that fierce competition among the card issuers are making the introductory rates better and better (and longer and longer). But don’t let the introductory rate cloud your judgment. For example, suppose two credit cards offer the following introductory rates: Card A offers a 4.9% APR for six months, then a 11.99% purchases APR. Card B offers a 0% APR for six months, then a 13.99% purchases APR. Your inclination might be to choose Card B with the zero interest for six months; however, if you intend to carry a balance on your credit card for much longer than six months, you should always choose the card with the lowest purchases APR, even if it doesn’t offer the lowest introductory rate. Doing so will result in saving you literally hundreds or even thousands in interest charges in the long run if you always carry a big balance on your credit cards. Remember, the introductory rates are only a fraction of the total time the average person holds on to and uses a credit card. From now on when you receive literature from a credit card company offering a special introductory rate, go immediately to the terms and conditions and find out what the regular rates are that kick in after the special introductory period is over before applying for the card.
Don’t choose a credit card because it offers great rewards or cash back: Credit cards that offer cash back or rebates, such as discounts on future automobile purchases, etc., sound great, but they are a very poor deal if the purchases APR is high and you have to jump through many hoops to qualify for the rewards. Too often the rewards are just another selling point for the card issuers, and upon reading the fine print contained in the terms and conditions, one might find quite that the prizes don’t come easy. If someone came up to you and said, “I’m going to make a deal with you. Give me the $500 you have in your wallet now, and three years from today, I’ll give you back $20.” You would laugh, say “no thanks” and walk away, but consumers naively accept a similar deal with many of these types of credit cards.
Accept a cash rebate card only if it offers a decent purchases APR. If the purchases APR is acceptable to you, and the card happens to offer rewards, too, then it is a good card, but don’t let the idea of saving, for example, $500 on your car purchase three years from now, convince you to accept a card with a high purchases APR. If the purchases APR is 24% and you have to maintain a big balance to earn reward points or get cash back, you will incur much more in interest charges than you will ever receive back in cash or future discounted purchases.
DO choose a credit card with the lowest APR possible. If you are one of the 30 percent of Americans who pay their credit card balances in full each month, the interest rate is irrelevant to you, since almost all cards come with a grace period allowing a period of time to pay the balance in full without incurring interest fees. However, if you regularly carry a balance on your credit cards, the interest rates [the purchases, balance transfer and cash advance APRs] should always be your number one consideration in choosing a credit card.
[source: http://www.bcsalliance.com]