Credit card penalty rates are commonly around 29.99%, but can be higher or lower with some credit cards. The finance charge would be $20.54 on a $1,000 credit balance at a 29.99% penalty rate. Compare that to the $10.27 finance charge you'd pay on the same balance but at a much lower 15% interest rate and you'll see just how expensive the penalty rate can be. Late payments are added to your credit report as you become 30, 60, 90, 120, and 180 days late. Unfortunately, these late payments will make your credit score decrease and could ruin your ability to get a credit card, loan, or even a job in the future. What it means to default on a credit card. In case you’re unclear on what defaulting on a credit card means, here’s the gist: After you’ve failed to make a payment on your credit card for 180 days, your issuer assumes you’re probably never going to. At this point, the issuer can (and usually does) close your card,