Home > Credit Cards > 3 Credit Cards That Don’t Charge Late Fees

Comments 0 Comments

If you think credit card interest rates are high, then you should take a moment to calculate the effective interest rate of a late fee. Federal law caps late fees at $27 for the first late payment and forbids these fees from exceeding the amount of the minimum payment. But if you were assessed a late fee of $27 for paying a $27 bill a day late, it would be the equivalent of paying 36,500% interest on $27 for one day!

While this is an extreme example, late fees can still be very costly, especially when combined with the higher penalty annual percentage rates (APRs) that many credit cards impose after you miss a payment. Thankfully, there are some credit cards that will waive some, or all, of your late fees. But even if you have one these cards, interest will still be calculated based on your average daily balance, so you should still strive to make your payments on-time in order to reduce your interest costs.

Remember, too, it’s important to read the fine print of any credit card you are considering to be sure it’s right for you. It’s also a good idea to check your credit, since a good score will help your qualify for the better plastic out there. (You can view two of your credit scores, updated every 14 days, for free on Credit.com.)

With that in mind, here are three credit cards with no fees for paying late. 

1. Citi Simplicity

Besides having no late fees, this card features an outstanding promotional financing offer. New accounts receive 21 months of interest-free financing on both new purchases and balance transfers, with a 3% balance transfer fee. Following the promotional financing period, cardholders will receive a standard interest rate of 13.24% to 23.24%, depending on their creditworthiness when they apply. Also, this card has no penalty interest rate. (Full Disclosure: Citibank, PenFed and Discover advertise on Credit.com, but that results in no preferential editorial treatment.)

Other benefits include Citi’s Price Rewind service, which will automatically refund a price difference when an eligible item is advertised for less within 60 days of purchase. This policy has a limit of $500 per item and an annual maximum of $2,500 per year. Cardholders also receive extended warranty coverage, worldwide rental car insurance, and travel and emergency assistance. There is no annual fee for this card.

2. PenFed Promise

If you really hate paying credit card fees, this could be the card for you. This card does away with not just the late payment fees but with all other credit card fees including annual fees, foreign transaction fees and cash advance fees. And although this isn’t a rewards card, new applicants can receive a $100 bonus statement credit after spending $1,500 within 90 days of account opening. New accounts also have a low balance transfer APR of just 4.99% for the first 12 months, with no balance transfer fee. Afterwards, the standard interest rate for new purchases and cash advances will be 10.24% to 17.99% based on your creditworthiness.

Finally, keep in mind that PenFed is the Pentagon Federal Credit Credit Union, which was created to provide financial services to members of military, government and defense organizations, as well as their families. Membership is also available to those who join a military support charity for a small, one-time fee. There is no annual fee for this card.

3. Discover it

The Discover it card offers an automatic waiver of a cardholder’s first late payment fee, and unlike most cards, it doesn’t have a penalty APR. The standard Discover it card offers 5% cash back on up to $1,500 spent each quarter on select categories of purchases, and 1% cash back on all other purchases. Rewards can be redeemed at any time and for any amount as cash back, statement credits, gift cards or merchandise.

This card offers 12 months of 0% APR financing on both new purchases and balance transfers, with a 3% balance transfer fee. Afterwards, the standard interest rate will apply which is 11.24% to 23.24%, depending on your creditworthiness when you applied. There is no annual fee for this card, and no foreign transaction fees.

At publishing time, the Citi Simplicity, PenFed Promise and Discover it cards are offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for these cards. However, this relationship does not result in any preferential editorial treatment.

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

Image: AJ_Watt

 

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Certain credit cards and other financial products mentioned in this and other articles on Credit.com News & Advice may also be offered through Credit.com product pages, and Credit.com will be compensated if our users apply for and ultimately sign up for any of these cards or products. However, this relationship does not result in any preferential editorial treatment.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Our Owners

Credit.com is owned by Progrexion Holdings Inc. which is the owner and administrator of a number of business related to credit and credit repair, including CreditRepair.com, and eFolks. In addition, Progrexion also provides services to Lexington Law Firm as a third party provider. Despite being owned by Progrexion, it is not the role of the Credit.com editorial team to advocate the use of the company’s other services. In articles, reporters may mention credit repair as an option, for example, but we’ll also be sure to note the various alternatives to that service. Furthermore, you may see ads for credit repair services on Credit.com, but the editorial team isn’t responsible for the creation or implementation of those ads, anymore than reporters for the New York Times or Washington Post are responsible for the ads on their sites.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team