CFA joined Americans for Financial Reform Education Fund (AFREF) and the National Consumer Law Center (NCLC) in comments to the Consumer Financial Protection Bureau (CFPB) in response to their Advanced Notice of Proposed Rulemaking on Credit Card Late Fees and Late Payments. In the comments, the organizations wrote that late fees imposed by card issuers exceed the amounts they incur in costs. To combat this issue and better protect consumers they recommend that the CFPB amends Regulation Z to require:
- More closely tailor late fees to the amount of the debt owed by the cardholder;
- Require a mandatory waiting period of several days before a late fee can be assessed;
- Decline to incorporate deterrence as a factor in setting late fee rules and safe harbor amounts;
- Include the savings from online-only statements in the calculation of costs, and require a postal mail notification before a late fee can be imposed for an online-only account; and
- Exclude the costs of being a furnisher of information to consumer reporting agencies.