Beware of paying you credit card late as it become very costly for you in terms of interest rate. You must keep tracking about you credit card carrying balance’s due date. Ignorance about payment date may lead you to late payment problems. One major setback for you can be change of fixed interest rate to a different high interest rate. So it’s necessary for carrying balance credit card holder to pay on time in most urgency. 
Penalty Interest Rate
Many bank spontaneously charge extra payment as late fee charges upon any late payment after due date. It may vary bank to bank but it is usually near $35. But it becomes more dangerous when a credit card lender changes the credit card interest rate to their default interest rate. Most of the lenders increase this late payment penalty to nearly 29% APR. Most of the bank allow credit card holder one month late payment relaxation in a period of 12 months. But one has to go through borrower’s agreement carefully and give special attention to credit card late payment portion.
Suppose you have $10,000 balance at 9.9% APR and it has nearly $82 monthly finance charges. Now if your credit card payment get late only a single day after the due date you may have to pay 28.9% Apr instead of 9.9% APR and it will around $241 instead of $82. Here late payment fee of $35 is very small in view of this increase in interest rate. You can avoid this increase in interest rate by transferring balance to some other place.
A late payment penalty fee can be waived off if credit card issuer wants. But these day trends are changing due to economic recession. Lenders now hardly forgive such late payment and close the credit card account. Consultation to bank’s customer care service is best decision for negotiating for waiving of late fee and interest rate increase.
Credit Card Act of 2009
Credit Card Act of 2009 (Credit Card Accountability, Responsibility, and disclosure Act of 2009) that is active from February 2010 does not allow any change in interest rate on credit card existing balance that is not old less than 60 days. It may save a credit card interest rate sudden increase but it also result in high interest rate on further purchase or new balance. The Act also require a lender to give the agreed interest rate if borrower pay six month worth amount on time after the interest rate increase.
Late Payment Effect on Credit Report
Less than 30 days late payment will be stated as “paid as agreed” on the credit report. But the increase in minimum payment due to late payment increase in interest rate will high the income debt ratio and it become difficult for borrower to get some other loan like mortgage.
Late fee charges and illustration of late fee on credit report is not of great concern. But the increase in interest rate on credit card late payment make is costly. So one can easily avoid this increase in interest rate by paying the amount at due dates.
Thanks for the reminder! Any tips on remembering to pay credit card bills on time? What’s your secret?