What Happens If You Miss a Credit Card Payment?

If you miss a credit card payment, will it damage your credit immediately? I’ve been working to catch up on my bills after being unemployed, but I’m still barely making ends meet and one credit card company says I’ve used up all my deferment. I just don’t have the money to make the payment yet, so what will happen if I miss it? I may need to get a car soon, so I don’t want to damage my credit if I can avoid it.

Danny
Minnesota

You have a small window where you can avoid credit score damage.

Hi Danny,

I don’t know how much it will help, but you do have a small window where you can make the payment and avoid credit damage. Credit card companies will not report a payment as missed until it is 30 days past due. This means you have a few weeks to make the payment before the creditor will report it.

Some creditors won’t report a payment as missed until it is 60 days late if you’ve never missed a payment before. However, that is up to the creditor’s discretion. So, your best bet is to do what you can to make the minimum requirement within 30 days of your billing due date.

Keep in mind that credit score damage is not the only concern you need to have. There’s also the matter of late fees.

First, determine when you can make the payment

In your case, Danny, it sounds like you’ve already been in contact with the creditor and they’re just not willing to budge on outright deferment. But you may still be able to get them to work with you.

First, look carefully at your budget to see when you would be able to make the payment. Then try calling the credit card company one more time. Having a set date when they could expect the payment might sway them to give you a little leeway. It’s worth a try.

If the payment will be more than 30 days late, you’ll need to make two payments

Be aware that if you will be more than 30 days late with your payment, then you will need to find funds to make two payments at once. You will essentially need to make this payment, plus the one for the next month if you want to avoid having the creditor report the payment as missed to the credit bureaus.

That’s not including late fees. If you’ve been late before, be aware than the fees will be higher. Late fees should be outlined in your credit card agreement or you can call customer service to ask.

Call for credit counseling if you’re having trouble catching up

One last recommendation I’d make is to call 1-888-294-3130 to get a free debt and budget evaluation from a certified credit counselor. From what you describe, you may be in a situation where credit counseling would be beneficial.

The credit counselor can help you assess your budget to see if you’ll be able to catch up on your own. If not, they make recommend a debt management program. It consolidates all your credit card bills into one monthly payment. Then our team works with your creditors to reduce or eliminate interest charges and stop penalties and fees.

This type of repayment plan can be immensely beneficial if you’re having trouble catching up after a period of financial hardship. Most creditors will even bring delinquent accounts current as soon as you make three consecutive payments on time. Depending on your situation and your budget, the program may help lower your monthly payments.

Another benefit I should mention is that being enrolled in this type of program will not prevent you from getting an auto loan. So, if and when you do need to replace your car, you would still be able to get approved as long as you met the lender’s requirements to qualify.