When you use your credit card, you’re agreeing to abide by the credit card issuer’s rules. And if you break the rules, you’ll have to pay a penalty. The good news is that the rules are simple and pretty easy to follow. Stick to them and you’ll avoid expensive credit card fees and penalty rate hikes.

Pay your bill on time. Late credit card payments carry the heftiest penalties of all. One missed payment and you’ll pay a late fee up to $25. Miss your payment a second time within a six-month timeframe and the card issuer can charge a late fee as high as $35. Not only that, if you fall behind by 60 days, your card issuer has the right to impose the penalty rate which could be 29.99% or higher.

Stay under your credit limit. You have to opt-in to over-the-limit charges, meaning you’ll first have to tell your credit card issuer you want these transactions to be processed. Not all credit card issuers charge a fee for going over the limit. Fortunately, those that do assess the fee can charge only charge the fee two consecutive billing cycles if your balance remains over the limit for that long.

Even if your credit card issuer doesn’t charge over-the-limit fees, they may still penalize you for going over the limit. For example, they may raise your interest rate, cut your credit limit, or even cancel your credit card.

Make sure your checking account has enough money for your payment. Before you send off your credit card payment, first check your bank account to be sure you have enough funds. If your payment is returned because you don’t have the money to cover it, your card issuer might charge a returned payment fee.

Overcoming Penalties

You should be especially careful to follow the rules if you have a promotional interest rate. Your introductory rate could be cancelled if you have late or returned payment during the promotional period. And with some rewards cards, your rewards are forfeited if you’re late on your payment.

Fees are expensive, but at least they’re assessed per instance. The penalty interest rate, for example, can remain in affect for six months for late payments. If you pay on time for six billing cycles in a row, the credit card issuer has to reinstate your pre-penalty interest rate.

Unfortunately, the card issuer may still apply the higher rate to your new purchases, indefinitely if they choose. Check your credit card terms to see if this is the case for your credit card.

If your credit card issuer is going to keep charging you the penalty rate on new purchases, even after you’ve done your time, pay the balance off and keep it paid. You might continue to use the card, for example if you get great rewards, but pay your balance in full to avoid such expensive finance charges. Or, with a good credit score, you may qualify for a good balance transfer offer that can let you pay off your balance at a lower cost.