A late payment is legally a breach of contract, and a court is allowed to award no more than the actual cost; anything more is unlawful. So any 'penalty charge' is unlawful, and they can be forced to return it. Sign up at the site I gave earlier, and ask for advice. I don't know about a default, though I'd have thought this was excessive pettiness, so it may be possible to challenge it. I do know that if you can argue that you defaulted due to problems caused by previous unlawful charges, it's possible to get them removed from your record.