Ask Credit Card Finder: Why was I charged a late payment fee?

Posted: 21 November 2018 11:13 am
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Can a late payment fee technically be charged if you've recently made a payment on your credit card?

Hi team,
Every month I make at least one payment on my credit card, and often I'll pay twice. I just checked my credit card account balance and saw I was charged a late payment fee, even though I'd made a payment two weeks ago. What gives?
Confused cardholder

I completely understand your confusion because I experienced a similar situation a few years ago. Fortunately, that means I can help explain what's probably happened with your account.

Credit card late payment fees can be charged whenever you haven't paid the minimum amount required by the due date on your statement. Looking at these two factors in more detail will help explain how and when a late payment fee may be charged (even when you've recently made a payment).

  • Minimum payments: This is the absolute minimum amount you need to pay off your statement and is usually calculated as a percentage of your balance, such as 2-3%. The minimum payment is typically listed on the first page of your statement, along with other key details such as the due date and your closing balance for that period.
  • The due date: Once your credit card statement is issued, you'll have a set amount of time to make a payment before it's considered "late". The gap between when the statement is issued and the due date for a payment depends on your card. So in some cases you might have 10 days to make a payment and in others you might have 21 days (or more) from when the statement's issued.

Based on these details, you could be charged a late payment fee if you've made a payment just before your statement was issued and haven't made another one before the due date. This is possible even when the payment you made was worth more than the minimum amount listed on the statement because technically your payment would have been made in the previous statement period (which is what happened in my case).

To put it simply: A payment must be made after the statement is issued for it to count towards the specified minimum repayment amount.

So, what should your next steps be? You may want to contact your credit card provider to discuss this late payment fee directly so that you can find out exactly why it was charged in your case. You could also ask what impact it could have on your account, especially considering your good history of making regular payments.

Then, set a reminder in your calendar or schedule automatic payments based on your account's statement period. Usually, the dates are similar each month but if you're unsure, call your provider and ask them for a date range that will allow you to avoid late payment fees in the future. You can also call them if you're ever worried you won't be able to make a payment by the due date.

Ask Credit Card Finder is a weekly column written by Finder's credit card expert Amy Bradney-George. All rates and fees are correct at time of publication and we only give general advice.

Do you have a question? Reach out in the comments or speak to someone from our 24/7 customer service team.

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