NEW YORK (MainStreet) — Coming across a late fee on your credit card statement is frustrating, but new research shows how willing credit card issuers are to waive such fees.
While you won’t receive a call asking if you’d like the fee removed, analysis from CreditCards.com said 86% of consumers were granted a fee waiver after simply ringing up the credit card company and asking.
A few minutes on the phone saved customers from throwing $25 dollars down the drain, the standard cap for a first-time late fee. The survey found, however, that just 28% of consumers actually ask for a waiver.
"It's probably the best time in years to ask credit card issuers for a break," said Matt Schulz, CreditCards.com's senior industry analyst. "Americans are pulling out their plastic again. Banks are loosening their grip on credit. That makes for a very competitive environment – and one that consumers can use to their advantage."
While it takes more than a late fee for a consumer to jump ship to another card, issuers don’t want to leave a bad taste in consumers’ mouths.
There are a few things to watch out for in trying to have one of these fees removed from your statement.
First, calling the card issuer could trigger a review of your account history. “This is to make sure you’re a good customer, and they’ll check if you’ve been late on payments before in the past,” said Gerri Detweiler, director of consumer education at Credit.com.
Chances are the issuer will wipe away your first late payment, but don’t expect the issuer to throw you more than one bone.
“The credit card company can also run your credit report at a moment’s notice, and if they see other red flags on the report, such as unpaid loans, they may consider you a high risk customer,” she added.
High risk customers could have their accounts closed or credit limits lowered.
The survey found that higher income customers tend to have a higher success rate in late fee removal.
Some 93% of households earning over $75,000 per year were granted a late fee waiver, compared to 76% in the $30,000-$49,999 income range.
It’s unclear why this dynamic surfaced in the study, but perhaps higher income consumers were more likely to be proactive and call the issuer to ask for the fee to be removed.
Regardless, there are some steps you can take to avoid paying your bill late. Set alerts on your smartphone or through the online portal of the credit card’s website.
Should you be experiencing financial difficulty, at least pay the minimum payment to keep you afloat. Plus, you may also want to contact a debt counseling agency to help you devise a plan to become debt-free. “One benefit of a debt management plan is they’ll contact the issuer to waive past late fees,” Detweiler said.
- Written by Scott Gamm for MainStreet. Gamm is author of MORE MONEY, PLEASE.