Can a creditor charge a late fee for a credit card payment?

In Illinois, a creditor may charge late fees for credit card payments, but they must abide by certain laws. Under the federal Credit Card Accountability Responsibility and Disclosure (CARD) Act, credit card issuers cannot charge more than one late fee for each monthly billing cycle and it must be reasonable and proportional to the amount of the minimum payment that was missed. The maximum late fee they can charge is up to $25 for the first late payment and up to $35 for any subsequent payments within a six-month period. Additionally, credit card issuers in Illinois must provide customers with a minimum of 21 days to make a payment before charging a late fee. If the customer does not receive a bill at least 21 days before the due date, the issuer is required to waive any late fees or interest if the payment is received on time. In addition, the CARD Act requires credit card issuers to post any changes to terms and fees on their websites at least 45 days before they take effect. This gives customers adequate time to read and understand any changes to their accounts. In summary, Illinois credit card issuers may charge late fees for credit card payments, but they must abide by the rules and restrictions of the CARD Act.

Related FAQs

What is a minimum payment on a credit card?
What are the risks associated with using a credit card?
What are the penalties for violating the Truth in Lending Act?
Can I use a credit card to pay bills?
What is a grace period for credit card payments?
What is a travel rewards credit card?
What is a secured credit card?
What is a penalty interest rate on a credit card?
What is a credit card annual fee?
What is a co-branded credit card?

Can a creditor charge a late fee for a credit card payment?

Related FAQs

Related Blog Posts