Job loss, job change, new marital status and all sorts of factors may monkey with your cash flow schedule. But when changes happen, will your credit card company work with you to move your credit card bill's due date?
Yes, say major issuers, but there may be a caveat.
American Express, Capital One and Citi require that customers not be more than 30 days past due on payments to make such a change. A spokeswoman for Chase said though customers would generally need to be in good standing, the bank will work with people having trouble making their payments to find an appropriate due date. Others will do it even if you don't have a stellar credit history.
Assuming eligibility, all cardholders need to do to make the change is flip the card over and call the customer service number, visit their local branch or request the date when they apply for a card. Some banks allow the change to be made online. Changing the date won't affect your credit score or result in penalties.
Three dates are off limits -- the 29th, 30th and 31st -- because those dates don't occur every month. But otherwise, the strategy of choosing one is up to you. If you're changing the dates to correspond with incoming checks, take a look at what date your paycheck, unemployment check or other regular checks arrive and schedule the credit card payment enough days afterward that a check would arrive in the mail or be cleared for transfer online on or before the due date.
"You'd be surprised how many people don't realize they can change their due dates," says Alexis Moore, president and founder of the national consumers group Survivors in Action: "Moving the due date makes sense if it helps make it easier for the consumer to pay their bills on time and in full. I urge consumers who are paid twice a month, for example, to schedule their (credit card) bill later in the month and utilize their first pay checks to pay their mortgages or rent."
"I tell folks if you've got a car payment, credit card payment, those should always be secondary anyway." Pay the things that affect a roof over your head or your insurance status and then schedule credit card payments later in the month, she says.
Another reason to change dates may be to simplify payments when you have more than one credit card. Philip Lee, wealth manager for Modera Wealth Management in Boston, said he called his own credit card issuer to change his due date because he had two cards from the same company with different rewards programs and different billing cycles. He wanted to keep the two cards but also wanted to simplify his payment schedule. It never hurts to make the call, he says.
"People are often fearful to call the credit card company and ask for changes. They just assume that you're locked into the terms," he says.
Once your issuer agrees to change the date, it may take one or two billing cycles, depending on the date you choose, so be sure you know which month the change takes effect.
In fact, don't go by what a person tells you over the phone, says Howard Dvorkin, CPA, founder of the nonprofit Consolidated Credit Counseling Services in Fort Lauderdale, Fla. Make sure you have written confirmation that the date has been changed before you delay paying that first bill, he says, because paying late could lead to penalty fees and affect your credit score and interest rate.
Also beware that if you move the date later in the month than your current one and your first cycle is, say, 40 days instead of 30, finance charges from those extra days on an outstanding balance will be added to the total.
Change wasn't always easy
Hugh Glazer with the WinterView Group, a business advisory company based just outside of Boston, said credit card issuers were not always as willing to change the date.
"It used to be, a long time ago, that it was very rare that that was offered. There would be some cases where you could change it, but the first of every calendar year, it would go back to whatever the default was and you'd have to re-request it.
"The idea that you can adjust when your payments are due to fit your personal cash flow is a very nice feature."
There may be renewed motivation in this economy for credit card companies to offer this service, Dvorkin says: "They realize if they say no, there's a pretty good chance that customer is not going to pay. Changing the date will help people budget."
In addition, credit card issuers may be more amenable to cooperating on due dates because they had their wrists slapped by federal lawmakers over the issue: Many consumers complained that card issuers would cavalierly change due dates in ways that encouraged late payments. That changed under the Credit CARD Act of 2009. It dictates that due dates must be on the same date day each month. If due dates fall on weekends or holidays, payments made on the next business day must be accepted without incurring a late fee.
When you shouldn't change
There could be a wrong reason to change the date, Dvorkin says, and that's when you're out of cash and you're changing the date to give yourself a slight reprieve for one month.
That may be a red flag that you're in trouble with your debt and you may need to seek financial advice, Dvorkin says. "At that point, the problem is not the payment due date but that there's not enough money and too much month."
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