Late Credit Card Payments Will Cost You More Next Year
Not paying your credit card could hit your wallet a little the next year.
The Consumer Financial Protection Bureau is increasing the allowable cap for late fees on credit cards by $ 1 starting January 1, 2019. It is not certain that the card issuers themselves will set higher fees on this day, but this is likely to happen in the coming months. According to NerdWallet, these are the new fees:
- $ 28 for the first delay. They were previously capped at $ 27.
- $ 39 for subsequent violations. They were previously capped at $ 38.
The 2009 CARD Act “contains a provision that allows the CFPB to adjust the limits of permissible late payment penalties annually in conjunction with the CPI,” NerdWallet said. This year, the consumer price index has risen .
So how can you avoid this fate? Automatic payments are a good idea – you need to make at least a minimum payment to avoid them, although the best course of action is to track your expenses and live within your means so you can afford to pay your entire bill on time.
Aside from commissions, late payments can also cause your issuer to increase your interest rate, also known as the annual penalty rate, or report it to the credit bureaus if it’s 30 days late, leading to a decrease in your credit rating.