Late Fee

Late fee is one of the primary ways in which financial institutes like banks and credit card companies make money. Most companies have this late fee regulation when a customer fails to pay the dues by the date that the company has stipulated. While it is the customer’s duty to pay the dues at time and not get penalized with a late fee, it is often said that the companies like it when the customers go for late payment, resulting in paying high interest rates. There are ways to avoid late fees and for that one just needs to be a bit organized and take some measures when one falls into a situation where late payment is unavoidable.

Here are few tips to avoid late fees. Firstly the best way is to pay the money that is due at the first available chance, for that arranging an automated system is the best option. If you have a healthy bank account, arrange it in such a way that every month the minimum amount due can be transferred from your bank account to the company on a fixed date without incurring any late fees. One can always pay-off more when the time is right.

It is always advisable to pay-off the entire amount that is due before the due date, but if you are not in the position pay the minimum amount. If you fail to pay the company will be after you, so once you pay they will leave you and be glad that you will be paying higher interest rate on the balance amount for the upcoming month/s.

Most often late fees are the result of the wrong due dates. So if you feel your money is slipping away before you can pay-off, just call up the company and ask them to change the due date to the date of your liking. The best day is on the same day that you get your cheque of the month.

Understand the company’s rule regarding the payment, as most of the companies are meticulous about their payment methods, so learn which process is beneficial for you so that you can avoid late fees. Most companies in India prefer to have their cheques in their office three days before the closing of the due date and in failure to do so a late fee is incurred. There are also rules in relation to paying cash, so learn these terms and conditions.

At times the paper statements get delayed resulting in the customer having to pay a late fee, so use the technology and go for e-statements and pay your bill online. Also if you are in some unavoidable circumstances once in a while you can ask the company to waive the late fee. Most companies will do that when requested but that will not happen every time. Lastly, if you are in a real tough situation financially, unable to pay your dues for that month, you can ask for the option ‘Skip-a-payment’. Most companies give that benefit once but not regularly.

Late fee on a regular basis will give you a bad credit score and the late fees can soon send your finances over the limit, where you will end up paying more than you bargained for, while purchasing goods. So plan your bill payment and avoid late fees.