Question: What is Credit Card Default?
Answer: Credit card default happens when you break the terms and conditions of your credit card. When you accept your credit card, you agree to certain terms. For example, you agree to make your minimum payment by the due date on your credit card statement. If you pay less than the minimum or you don’t make your payment by the due date, you are in credit card default. Going over your credit limit and having your payment returned by your bank are also types of credit card default.
Credit card default results in additional fees and sometimes an interest rate increase. You may be able to have some credit card default fees reversed if you ask your credit card issuer. You’re more likely to have these fees waived for first time offenses. When your interest rate increases to the default interest rate, it can only remain there for six months. After six months, your credit card issuer is required to review your account and lower your rate as long as you haven’t re-defaulted within the past six months.
