If You Miss A Monthly Credit Card Payment, Here’s What Happens

The first thing customers will face when missing a credit card payment is a late fee. These fees can vary depending on your cardholder agreement, and the credit card issuer’s policies. Legally, credit card companies can only charge certain amounts for late fees. For instance, a first-time late payment can only be charged a fee of up to $30, while a second late payment within six months escalates the fee to $41. Even though you can only be charged one late fee per monthly cycle, these charges can add up. With that in mind, the Consumer Financial Protection Bureau (CFPB) proposed changing these fees to $8 in early 2023. The CFPB estimates that credit card late fees amount to about $12 billion each year.


Missing a credit card payment can also lead to different APR impacts. It’s important to remember that credit card companies charge APR interest per day, meaning your due amount grows every day past your due date. Also, depending on your terms, you may face a penalty APR. These APR rates are higher than your standard APR, and can not only affect your existing balance but also apply to future balances. By law credit card companies must lower the APR rate on your outstanding balance back to your normal interest rate after six months of on-time payments, however, they can still continue to apply the higher penalty APR on any future purchases on your account. This means that missing even one payment can lead to long-term issues.