Friday, October 07, 2005

Credit Card Late Payment - Penalty and Solution

Credit card late payment - penalty and solution

One day, when I review my credit card monthly bill from Chase bank, I saw a $39 late payment fee. And the promotional APR ,which is 3.99% until balance is paied off, has been changed to around 15%.

You may run into this trap setup by credit card companies. Such late fees are not illegal, they are often hidden in fine print. And if history repeats itself, 60 percent of credit card users will incur them this year.

The latest punishment—known as "universal default"—allows for virtually any late payment to trigger interest hikes and additional fees on other loans. With universal default, if you’re late paying your credit card bill, your insurance, mortgage or car loan rates can also increase. A single late payment can raise auto insurance rates as much as 50 percent. Most insurers now check for late payments in underwriting new business.

Meanwhile, if you’re late paying your insurance premiums and most other bills, your credit card interest rate may double.

Other consequence: The late fee may be waived, but also they may have an automatic increase in your card’s interest rate. It also can wipe away accumulated "rewards," such as free air miles.

Not that card issuers make it easy for customers to pay on time. In addition to strict hour deadlines, bills are now mailed closer to the due date, leaving customers with one week less to submit payment than a decade ago.

Recommendations:
1) mail all payments at least 10 days before their due date;
2) Set up an automatic online payments using your bank's online bill payment system. Still set at least 5 days ahead of the due date.
3) Try pay by phone with the credit card company, but typically charge $15 per transaction.

Where to complain:
1) Talk to your credit card company about dropping them.
2) Contact your state attorney general’s office
3) Contact the U.S. Office of the Comptroller of the Currency at (800) 613-6743

6 Comments:

At 9:53 AM, Anonymous Anonymous said...

complain what?

 
At 8:55 PM, Anonymous Anonymous said...

Complain about this article is not clear, haha.

 
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