My wife has a Citi credit card. She usually pays it off every month, or leaves a little on it depending on the month. Rarely does it go more than two months with a balance. She always pays on time, at least up until this month.
We're in the process of looking for a house, and we've started making two payments on our credit cards per month, to maximize that debt to available credit ratio. In case you aren't aware of what this means, I will explain.
The credit card companies report to the credit agency monthly. They report if you are up to date in your payments, your current debt, and your available credit. This reporting does not occur after your monthly payment on your credit cards. To maximize your credit score, you want the ratio of debt to available credit to be as low as possible. So, if you've got a $5k limit credit card, and you use about $3k per month, but pay it off every month, the credit agency will likely think that you have $3k outstanding on a $5k credit card for a ratio of 3:5. That's bad. It is not reported if you pay the credit card off every month. This is stupid, I know. The other way of improving this ratio is to increase your credit limit on the card. Apparently, because requesting to be able to borrow way more than you need is fiscally responsible. You know, I'm going to stop talking about the credit ratings, because that's a whole other diary. Back to Citi and my wife's credit card.
Much like the folks at most big banks, the folks at Citi are complete assholes. I mean the biggest pieces of unethical, scheming, conniving shit in the world. Like clockwork, they bump the payment due date up one day per month. However, this month, that caused my wife's payment to be a day late. Bang, $39 late fee shows up on Mint (by the way, for those of you not using Mint, go to mint.com today, and set up an account. It's the best free way to track your finances yet, and no I'm not affiliated with them in any way).
Only, we saw this little trap coming from a mile away. In fact, it's yet another reason why we started paying our credit cards twice a month. The 'late payment' my wife made, was not actually a late payment, instead it was an additional payment - the second payment she had made since the last billing cycle.
She called Citi and basically, Citi's response was that the first payment had come 'too early' to count for this month's payment. The payment occurred more than a week after the end of the prior month's due date (which, again, was one day later in the month than this month's due date). So, not only are they moving up the due date, they are apparently narrowing the window of dates that 'count' for paying the minimum payment without incurring a fee. Wow, I did not see that trap coming.
Citi agreed to wave the fee 'this time' because of her good credit history, and because this was a first time thing. So, yay for that, I guess. But they did nothing to address the problem of us wanting to pay bi-monthly in part to avoid late payments caused by a perpetually changing due date. I guess we'll just have to continue to be diligent about paying that $30 right near the due date in addition to paying the whole damn thing off a couple of weeks prior.
In conclusion, to my fellow Kossaks, don't pay your credit cards late, but don't pay them too early, either. And good luck in dealing with your finances in America. Everything is fubar.