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Pay bills on time and move on
If you fail to settle them, they will cause you more trouble that you may have anticipated.
- By Steve Bucci, Bloomberg
- Published: 23:12 September 5, 2008
With apologies to Frank Sinatra and his great song My Way, your way or the highway doesn't work well in personal finance matters. This is especially true once you have signed a contract to do it their way.
One of the hard lessons in money management is that being right isn't always the most important thing. In this case, sticking to your guns and not paying the late fee may end up costing you many times more than that.
I would bet that the card agreement that you signed with the card issuer includes a clause that states something to the effect that the card issuer can charge you a late fee if payment is not received on time for any reason.
Mailing a bill payment or using a website doesn't guarantee that the payment will be received on time. If the mail is late, so are you. The only solution is to pay a bit earlier and to check your bank account to see if the payment went out.
I use an automatic email alert on my bank account to tell me when there is any activity. This helps for identity theft early warning and allows me to know when a payment clears. Bottom line, each month you ignore the bill, the cost to you increases.
By closing your account, you diminished your influence with the credit card company.
If they cared so little for you as a customer that they wouldn't waive the fee, you can imagine that they care even less now that you aren't a customer any longer. My recommendation is to contact the lender and let them know you would like to pay off the balance due. Tell them you will pay the balance owed under protest, but want them to remove the delinquent item from your credit report.
Make sure you receive a promise - in writing - to remove the item before you make the payment. If you can't get a customer service agent to agree, ask for a manager and be prepared to go up the chain at the bank.
Eventually, someone should agree. Be sure to be pleasant. I suggest you characterise this as an unfortunate miscommunication that just needs to be resolved as opposed to say, insensitive gouging.
If you have a well-established credit history, this one delinquency will not hurt you that much. If you are new to credit, then it may make more of a difference. Either way, you need to take care of it now.
If you decide not to pay, the item will cause you more trouble with your credit as it becomes increasingly delinquent, is charged off by the lender (much more serious) and then is placed with a collection agency and finally an attorney, each of whom is authorised to add collection costs on to your bill.
By the way, it won't hurt your husband at all unless this was a joint card, as you each have separate credit records. Life is too short for this stuff. Pay the bill and move on.
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