Credit Repair Savvy: How to Avoid Paying Late Fees

We’ve all been there: Life gets busy, the mail piles up, and oops, you forget to pay a bill or two. It’s not the end of the world. That said, paying a bill late could result in a late fee, something you should avoid if possible. While a late payment won’t hurt your credit score within the first 30 days, a late fee will always hurt your savings account. Why sacrifice your hard-earned cash?

Take the following steps:

1. Handle the issue ASAP. 

Call your creditor and say the following:

“Hello, I had a bill due on (insert date here) and I just noticed it was late. Sorry about that. I’d like to pay it today.”

Communication is the first step to avoiding late fees and credit repair damage. Take responsibility for your misstep before negotiating late fee forgiveness.

2. Ask for a pass. 

Before paying your bill, ask for leniency surrounding the late fee. Say this:

“I realize the payment is overdue, but I’m hoping you’ll forgive the late fee. I have always paid on time before and I promise that this oversight won’t happen again in the future.”

Unless you are prone to chronic late payments, a creditor is usually willing to give you the benefit of the doubt on a first offense. Be cordial, but firm.

3. When all else fails, use your leverage. 

Some creditors play hardball, insisting that they cannot waive late fees under any circumstances. Don’t be fooled. It’s their business, and they have the power to adjust your account accordingly. If they refuse to budge, say this:

“I’m sorry to hear that you’re not willing to waive the late fee just this once. I have been a loyal customer for (insert time frame here) and would hate to take my business to one of your competitors.”

The average creditor isn’t willing to lose your business over a measly late fee. This strategy is likely to soften their “no exceptions” policy and erase the late fee from your account. Note: Use this tactic sparingly. While it’s unfair for your creditor to subject you to unnecessary fees, it’s equally unfair to expect special treatment every time you miss a payment.

In the future:

If you’re a worrier, the stress of an unpaid bill is likely to teach you a swift and lasting lesson. For those of you who are still learning, it’s important to limit your exposure to credit damaging late payments. Although the occasional slip-up won’t hit your score, serious cases like collections or charge-offs can haunt you for years. Keep yourself safe by:

  • Using double reminders. Paying your bills early is always a good idea. Schedule a reminder on your phone or computer to pay your bills at least two weeks before their due dates. As an added measure, schedule another reminder the following week to ensure that you follow through with payment.
  • Considering automatic bill-pay (with caution). Many creditors offer an automatic bill-pay service, allowing them to draw payment from your bank account each month. While this service is convenient and useful, be sure to review your payments. A computer glitch or overcharge could result in larger credit damage down the road.
  • Scheduling a universal payment day. If you are bad with dates, why not set up a universal payment day? Call your creditors and ask them to move your due dates to a singular day on the calendar, e.g., the 15th of every month. This narrowed approach will help you keep track of your bills and avoid problems in the future. You can’t lose.