NEW YORK — A Texas judge earlier this month threw out a federal rule that would have capped credit card late fees at $8.

The Consumer Finance Protection Bureau finalized the rule last year as part of the Biden administration’s efforts to do away with what it called junk fees. It was paused by the courts before it could take effect.

At the time, the CFPB estimated that American families would have saved more than $10 billion in late fees annually had the fees been capped at $8, significantly less than the $32 average.

Banks and industry groups argued that the rule didn’t allow card issuers to charge fees high enough to deter late payments and discourage repeat violations.

The Texas judge’s ruling earlier this month came a day after a collection of major industry groups and the CFPB under President Donald Trump announced that they had reached an agreement to throw out the rule.

Here’s what to know about credit card late fees:

The average late fee for major issuers has steadily ticked up since the 2010s, going from $23 at the end of 2010 to $32 in 2022, according to the CFPB. WalletHub, which tracks financial data, found the average late fee in 2025 to be $30.50, with the maximum $41.

A September 2023 Consumer Reports study estimated that 1 in 5 American adults, or about 52 million people, paid a credit card late fee in the previous year. People with lower incomes pay proportionately bigger fees, according to the CFPB, with the highest burden falling on communities of color and those living paycheck to paycheck.

Enrolling in auto-pay for your credit cards can help you avoid making late payments, and there are some credit cards that don’t charge late fees at all (though it’s important to note that these cards may have other fee or penalty structures, or higher interest rates.)

Citi Simplicity and the Apple card do not currently charge late fees, and Discover offers a card that will automatically waive the first late fee.

It’s also possible to appeal credit card late fees charged by your credit card company by calli

NEW YORK — A Texas judge earlier this month threw out a federal rule that would have capped credit card late fees at $8.

The Consumer Finance Protection Bureau finalized the rule last year as part of the Biden administration’s efforts to do away with what it called junk fees. It was paused by the courts before it could take effect.

At the time, the CFPB estimated that American families would have saved more than $10 billion in late fees annually had the fees been capped at $8, significantly less than the $32 average.

Banks and industry groups argued that the rule didn’t allow card issuers to charge fees high enough to deter late payments and discourage repeat violations.

The Texas judge’s ruling earlier this month came a day after a collection of major industry groups and the CFPB under President Donald Trump announced that they had reached an agreement to throw out the rule.

Here’s what to know about credit card late fees:

The average late fee for major issuers has steadily ticked up since the 2010s, going from $23 at the end of 2010 to $32 in 2022, according to the CFPB. WalletHub, which tracks financial data, found the average late fee in 2025 to be $30.50, with the maximum $41.

A September 2023 Consumer Reports study estimated that 1 in 5 American adults, or about 52 million people, paid a credit card late fee in the previous year. People with lower incomes pay proportionately bigger fees, according to the CFPB, with the highest burden falling on communities of color and those living paycheck to paycheck.

Enrolling in auto-pay for your credit cards can help you avoid making late payments, and there are some credit cards that don’t charge late fees at all (though it’s important to note that these cards may have other fee or penalty structures, or higher interest rates.)

Citi Simplicity and the Apple card do not currently charge late fees, and Discover offers a card that will automatically waive the first late fee.

It’s also possible to appeal credit card late fees charged by your credit card company by calli