Credit card companies seem convinced that they have the right to charge whopping late fees of $39 and higher for payments which are even an hour late. They engage in deceptive machinations, such as frequently changing the terms of the credit card agreement, moving due dates forward and crediting payments the day after they’re received to make it easier to charge these unfair fees. Furthermore, may also jack up your interest rate. The changes in policy are obtuse, and are often tucked in with your statement, or worse, with junk mail you received from the same credit card company.
You will never experience this sort of duplicitousness with your other loans and financial obligations. I, for example, consistently paid my gas bill about seven days after the proposed due date. I was never charged a late fee or an interest charge. A year later I got a letter from the gas company thanking me for my on-time payments, and refunding my deposit! Clearly they weren’t all that attached to the payment date.
My car loan terms were fixed at the date of creation, unlike the credit card terms which are whimsically subject to change. Still, the people who managed my car loan never charged me a late fee for any payment I made after the due date, and also any extra payments were automatically credited toward future payments.
However, even if I pay every other bill on time, and pay the balance in full every month, my credit card company will charge me a late fee of $39 dollars for being so much as one day “late.
Many credit card customers make the mistake of blaming themselves when they’re charged late fees for payments which are late by only a day or two. As a result, credit card companies have bilked loyal, regular customers for an incredible amount of money. Many of these customers have an excellent track record of on-time payments for 10 years or more, yet the credit card company does not show the same degree of loyalty.
The worst part of this is that credit card companies rake in shocking profits, usually in the billions, at the expense of people like you and me. The more we put up with overcharges, the more money they make.
Call the Credit Card Company to Reverse the Late Fee
While it is better to prevent late fees, it is also important call the credit card company if you feel that you were charged a late fee unfairly. If you have been consistent with your payments in the past, most companies will give you a “one time courtesy” credit of the late fee. However, don’t let that stop you from asking the next time they charge you. Stay on the line, and call back as many times as it takes to resolve the situation. Don’t put up with bad customer service.
Question the Legality of Your Credit Card Agreement
Just because your credit card agreement states that you agreed to and are obligated to certain terms, doesn’t mean that the agreement is completely legal. Credit card companies often skirt the edges of the law to see how much they can get away with. Even if you can’t afford to call a lawyer over the charges, or it isn’t financially feasible to do so, you should still do everything in your power to fight back.
Write to the Credit Card Company’s Customer Service Department
A formal, professional letter written to the credit card company can do a world of good to protect your rights as a consumer. It creates a formal, written record of your complaint to the credit card company. The company is much more likely to take you as a serious threat if you write a letter. It’s extremely important that this letter be written in a formal l format. Take the time to reword emotional statements so that they sound more professional. Look at your word processing program and see what professional templates it provides.
Make as Many Payments on Time as Humanly Possible
The more payments you make on time, to this company and to other companies, the better you are protected. As a good customer, not only to that credit card company but to other credit card companies, you have more leverage. The credit card company which has charged you an outrageous fee for a payment or two which were a day late is much more likely to take you seriously if you have a high credit rating and an excellent payment history. They will be very unhappy to lose you as a customer.
Complain to the Better Business Bureau
If you feel that you feel that a credit card company has unfairly charged you high late fees and outrageous interest rates due to a late payment, you can complain to the Better Business Bureau. Any credit card company which is a member of the Better Business Bureau must respond to your complaint. If enough people complain, the credit card companies will think twice about their actions.
Pay Off the Card
Paying off the card is a great way to get even with the credit card companies. If you have enough cash to cover the debt, it’s a good idea to pay it off. However, even if you don’t, you can probably get another credit card or loan to pay off the balance.
Cut Up the Card
You can threaten the credit card company that you will cut up their card and use a different provider. If you’re really fed up, you can just cut it up and tell the credit card company exactly why they’ve lost your business. In either case, I strongly suggest that you write the company a formal letter. This gives you the time you need to compose your thoughts, and get them right before sending them to the company. It prevents poor customer service representatives from interrupting you, upsetting you, or otherwise preventing you from making your point.
Call a Debt Consolidation Company
If you can’t manage your debt on your own, a credit consolidation company can help. This resort, however, should not come until you’ve exhausted all other options. Chances are if your credit rating is decent, you can come up with a better solution than the debt consolidation company can offer you.
Call a Lawyer
This is a last resort, and will only be feasible if you’re in serious trouble. For example, if you’ve got a lot of debt on a credit card which you can’t pay off, and your credit rating is poor, and the company has just jacked up your interest rate. Just because you have a low credit rating doesn’t mean that people have the right to take advantage of you. Many people end up with a poor credit rating because of low income, lost employment or a financial crisis. However, even if your credit rating has declined due to poor decision making, you shouldn’t punish yourself by padding the pockets of the greedy money-mongers. You should always call a debt consolidation company before calling a lawyer.
Ways to prevent future late fees and interest hikes:
Set Up Auto-Pay
This is by far the best way to prevent late fees. No matter when your due date is, and no matter what the minimum payment, your card will always be paid on time. Be sure to select the “minimum payment” option. If you select a fixed amount which is the same as your minimum payment at one point, it may be insufficient to pay the payment in the future.
Check their Website
Most credit card companies have online versions of their credit card agreements which are easier to understand than the legalese which comes with your credit card or bill. Also, even when you have to slough through the legalese, at least it’s keyword searchable. Be sure to sign up for their online account management. Online account management is a godsend for credit card customers who don’t have very much time or energy to manage credit card accounts.
Read Your Credit Card Agreement
It’s important to read your credit card agreement carefully when you first sign up for a new credit cards. Scour that agreement and make sure you know that you know precisely what you’re getting yourself into.
Get on the Phone
Your credit card company has just sent you yet another revision to your credit card agreement in eight point print, very carefully hidden in your bill. If you have difficulty understanding it, or don’t have time to read it, call their 800 number and demand that the customer service representative explain it to you personally. You don’t work for the credit card company; they work for you! So why on earth should you spend your precious time ruining your eyesight to understand their unfair, whimsical and picayune changes?
If every last customer who was frustrated by having to read yet another credit card agreement revision called customer service for elucidation, they wouldn’t have them as often. Protect your rights as a consumer. No other company would change their agreement this often. No other company would skirt the boundaries of the law with their changes. You shouldn’t put up with it. You’re a good, loyal customer and even if you don’t pay them directly, they’re making a lot of money off of you.
Stay Educated
It’s much more important to stay educated about the typical deceptions engaged in by credit card companies than to memorize the current “terms” in your credit card agreement. After all, if those terms aren’t legal, they hardly matter. Most credit card companies will give you at least one freebie if you make a mistake. Stay on your toes and keep up with the latest developments.
