Credit card issuers that raise a cardholder’s interest rate because a minimum payment went unpaid for 60 days must bring the old rate back after six consecutive on-time payments, according to Regulation Z and the Consumer Financial Protection Bureau’s consumer guidance. The restoration is required under the rule, but the count is strict, and one slip at the start can cancel it.
The penalty rate is the most expensive thing a delinquent account can carry, and the six-payment rule is the way out of it. How the rule counts, and what it leaves out, decides how many months of the higher rate a cardholder actually pays.
What a 60-day miss allows an issuer to do
The CFPB says a card company is not permitted to raise the rate on existing purchases except in listed circumstances. The list includes an expired temporary rate, a variable rate that moves with its index, and a minimum payment that has not been received within 60 days after the due date.
The dollars add up quickly. A federal commentary example assumes a $5,000 purchase balance at 15% and an increase to 28%. On that balance, 13 extra points of interest comes to about $650 a year, or roughly $54 a month, before any compounding.
In that example, payments are due on the 15th of each month, and by May 16 the issuer has received none of the March, April or May payments. It sends a notice that the rate will rise to 28% effective July 1. That is the kind of delinquency the 60-day exception exists for.
The rate cannot rise silently. Under 12 CFR 1026.55(b)(4), the notice of the increase has to state the reason for it and say that the higher rate will stop applying if the issuer receives six consecutive required minimum payments on or before the due date.
Anyone who received a notice like that has the key instruction in writing. The practical first step is to find the notice, note the effective date of the increase, and mark the due date of the first payment that falls after it. That date starts the clock.
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How the six payments are counted
The regulation counts six consecutive required minimum periodic payments received on or before the payment due date, beginning with the first payment due following the effective date of the increase. The CFPB’s official interpretation of the rule repeats that starting point in its commentary.
The same commentary spells out the cost of a bad start. If the issuer does not receive six consecutive payments beginning with the payment due immediately after the increase, the reduction does not apply, even if six consecutive on-time payments arrive at some later point.
The measure is the required minimum, and the test is arrival by the due date. A payment sent a day late, or one that falls short of the minimum, fails the test, and the count cannot be repaired by paying extra the following month.
Applied to the same example, the first payment due after the July 1 effective date falls on July 15. Six on-time payments would run through the December 15 due date, so the old rate would be owed after that payment, subject to the next-cycle delay below.
On a card with monthly statements, six payments means about six months at the higher rate. The commentary also lets an issuer delay applying the reduced rate until the first day of the following billing cycle, so the restored rate can show up a few weeks after the sixth payment posts.
What the restored rate does not cover
The reduction is written for a specific set of balances. The rule text applies it to transactions that occurred prior to or within 14 days after the issuer gave the notice of the increase. It does not say purchases made after that window must come back at the old rate.
A restored rate is also not a guarantee of a low one. The commentary notes that a reduction does not stop a later increase under a different exception, and a variable rate tied to an index can still move when the index does.
The cost of a missed count can be put in dollars. On the commentary’s $5,000 example, the six months at 28% instead of 15% come to about $325 in extra interest, and a seventh month of delay adds roughly $54 more.
Cardholders who believe an issuer has kept charging the higher rate past the sixth on-time payment can ask the issuer in writing for the date it applied the reduction. The CFPB also takes complaints about card issuers through its complaint form.
Autopay for at least the required minimum is the simplest guard during those six months, since a missed or late payment is the one event that voids the count. Paying the full statement balance, where possible, removes the interest question for the new charges.
Still carrying a penalty rate after a 60-day miss?
A card balance that slipped 60 days behind carries more risk than the interest. Collector calls can follow, and every missed date or half-remembered conversation makes a bad stretch harder to untangle.
The Bank Account & Debt Protection Kit is built for that situation. It includes the debt-validation steps for making a collector prove a debt, plus a debt inventory, call log and deadline tracker for keeping the balances, dates and calls in one place.
The kit runs from the rule that guards benefits in a bank account to a section on when a collector calls and another on letters, worksheets and contacts, so the paperwork is ready before the next date on the calendar arrives.
Get the debt inventory, call log and deadline tracker →
This article was produced with AI assistance and edited for accuracy against the sources linked above.
