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You will pay a late fee. How much depends on the issuer. Several major issuers charge a range of late fees based on a customer's card balance. That's good news for customers with low balances -- they catch a break on fees. It's bad news for folks with big balances -- they face the highest late fees around. The fees range from $15 to $35.
Other card companies refuse to cut low-balance customers any slack on late fees. Everybody pays $35.
In 1978, the Supreme Court ruled that a national bank could charge the highest interest rate allowed in their home state to customers living anywhere in the United States, including states with restrictive interest caps. When it comes to credit card interest rates, the law in a lender's home state rules. It doesn't matter what kind of rate cap exists in a customer's state.
The same principle applies to credit card late fees. In Smiley vs. Citibank in 1996, the Supreme Court gave national banks free rein on credit card fees as well. As long as an eye-popping late fee is allowed in a lender's home state, the lender can charge it to customers nationwide.
Because most major credit card companies are based in states with liberal or no usury laws, the sky is the limit with interest rates and late fees. The best bet for consumers is to pay credit card bills on time every month.
Another good strategy is to pay the bill as soon as it arrives, even if you can only make the minimum payment. Giving your issuer the 2 percent minimum payment it wants ASAP is a great way to guard against late fees.
And you can always send a bigger payment later on when you have more cash.
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