Credit card late fees overview:
- Who: The Consumer Financial Protection Bureau (CFPB) finalized a rule cutting credit card late fees.
- Why: The CFPB says companies exploit a regulatory loophole to charge customers more than $14 billion in late fees annually.
- Where: The CFPB rule affects consumers nationwide.
The Consumer Financial Protection Bureau (CFPB) finalized a rule cutting credit card late fees by more than $10 billion annually.
Large credit card companies exploit a rule allowing them to charge excessive late fees that cost families more than $14 billion per year, the CFPB says in a press release.
The rule will slash typical fees from $32 to $8, saving 45 million people an average $220 per year, according to the CFPB.
“For over a decade, credit card giants have been exploiting a loophole to harvest billions of dollars in junk fees from American consumers,” CFPB Director Rohit Chopra says in the press release. “Today’s rule ends the era of big credit card companies hiding behind the excuse of inflation when they hike fees on borrowers and boost their own bottom lines.”
The CFPB introduced the rule in February.
Junk fee immunity provision lowered from $30, $41 to $8
The Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act) caps current late fees, blocks excessive fees and requires clear fee disclosures.
The law received a 2010 immunity provision capping fees at $25 for the first late payment and $35 thereafter, with those totals increasing with inflation, the CFPB says. Those limits have increased to $30 and $41, respectively.
Companies increased fees along with inflationary cap increases annually without proving an increase in costs, CFPB says.
The new rule caps fees at $8 and ends inflation-related increases for companies with 1 million or more accounts, which will cover more than 95% of all outstanding balances in the credit card market.
“CFPB data shows that smaller issuers tend to charge lower rates and fees to their borrowers, while the vast majority of the largest issuers charge close to the maximum allowable late fee amount,” the CFPB writes in the press release.
Have you been charged large late fees? Let us know in the comments.
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34 thoughts onNew rule to dramatically lower credit card late fees
Yes I have been charged late fees
Subject: Request to Join Lawsuit Regarding Late Fees
Dear Sir/Madam:
I am writing to request to be added as a plaintiff in any lawsuit against the company regarding unfair late fees. Despite multiple complaints and credits issued to my account, the recurring issue of inflated late fees has cost me over $100.00. I believe my experiences, along with those of other affected customers, warrant legal action to address this ongoing issue.
Thank you for considering my request.
Sincerely,
Lisa
I can’t count the amount I’ve been charged in fees!!!
Yes! I have 2 different cards that charge $40 on late fees!
OK I figured out that what these shady credit card companies are doing is they charge the desperate people who have never really had any credit or loans and are lower middle class people all these fees and then dont let them cancel and be sent to collections until the balance you owe is so high that they still turn a decent profit fit from selling the debt to collection agencies. This right here should be a crime. Preying on the desperate and less fortunate like this. When I tried to buy my first new car I was told I didn’t habe any large loans and Evan though I had a 786 score the interest rate for the 25k I borrowed from Ally was 17%. Plus they sold me stuff I didn’t know about that I didn’t need a nd never used. Gap ins. Extended warranties, tire replacement plans. That all adds up to around 8000 to 10000 if you add the interest. My wife bought a used Hyundai elentra that had a sticker price of 10k, but when she drove off her contract said she owed 25k+. The one time we tried to use the extended warranty we got charged 700$ which was the full cost of the parts ans labor for fixing it. They sd the deductible was higher and do I sd well then what good is an extended warranty. It’s like Ally wants the dealership to refer people to get loans but not unless the y both get to make 10k or more each my wife used 1700$ as a down payment and it was like she just burned it at the dealership. They knew that but let her. Ally didn’t even talk to my wife. This is what our govt has been paying d by the rich to do. To make laws that let them run over us look at this company top class actions. They think wh t they do is worth 30%of the settlements or more from every person.
Why did my mom only get 1.4 mil when the lawyers cleared hundreds of millions and my mom has a mech animal valve insixe her heart. Phen phen ready suit. Greed and people being self serving evil turds. When the covid outbreak happened my wife and I were both laid off. I didn’t get unemployment but to my wife did. But it still was just enough to get by for a year, after that I still couldn’t get a job and she got one at the post office but was only working a day or two a week. So she got unemployment for that but when it all ran out we were barely making it and then all these credit card applications kept coming. I got 3 and she got a few. The problem was we needed a credit card with a decent sized line of credit if like 3000, but instead we were approved for ten 500$ credit lines that charge you nearly 200 in deposits and fees at the start. She put all of them on auto pay so she didn’t have to worry. Well the auto pay for everyone ended up not taking the money. It worked for 2 or 3 payments each and then stopped. We didn’t realize because we got no bill in the mail. We got charged 40 dollars everytime they were late plus the 180 dollar a year fee and others. So now they want us to pay back the money after weve already paid probably 3 times what we owed. We called them all to ask them to cancel the cards and send them to collections but they just keep charging late fees and interest and other fees. So we cashed in some stock loosing 12k in penalties and getting 9k back. We used it to pay bills because inflation hit and we were barely making it. The at the end of the year we got hit with a 1500 income tax payment because we hadn’t paid in enough on our 65k total income. While 1000 of the billionaires Lucia g in the US paid no taxes. One of the bigger corps even got a refund check. How is all this fair. If we had just been given a line of credit that was decent and fair we could have paid them back. It’s totally bassackwards.
It’s about time someone put a cap on the credit card late fees i am charged 35-37 dollars in late fees . Then it makes it hard to pay.
The thing that gets me is Im on the West Coast and most of these companies are on the East Coast. Instead of having it due by midnight West coast time, their excuse for the late fee is “You didn’t pay it East Coast time” I don’t have time to keep track of their time when I pay my bill. Some of them want it by 6 pm when THEY close East coast time! They rake in billions in late fees from us West Coast people because of the time difference! Something needs to be done sbout THAT!
I was paying almost double each month on auto pay. Capital one increased my interest rate to 31% and I had a 767 credit score. When the interest increased the 140.00 I was paying went to 143.00 I paid 35.00 for 3.00 late fee. It happened for several months until I changed to take out minimum amount. The amount used to be around 70.00 per month.
There is another example of these companies charging you if you’re not paying attention to what they are doing. They take advantage that people have busy lives and aren’t always watching whats going on with all the charges that these credit card companies are dishing out!
Hi yes I have about seven credit cards and yes I have been late a few times but I’ll always pay and yes they do charge me late fee if I’m late can you help me pay off my credit card debt without the large interest rate
Add me please
Hi yes I have about seven credit cards and yes I have been late a few times but I’ll always pay and yes they do charge me late fee if I’m late