There’s a small window where you can avoid credit score damage if you miss a credit card payment.
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.
What Happens If You Don’t Pay Your Credit Card?
Not paying your credit card can lead to late fees, credit score damage, and eventually collections. In this ask the expert video, you’ll learn when each of these things will happen and what you can do to catch up if you’ve fallen behind.
April Lewis-Parks, Director of Education: Hi, it’s April with Consolidated Credit and this is ask the expert.
Today’s question is: What Happens If You Don’t Pay Your Credit Card Debt?
If you can’t make payments to your creditors, you need to call them as soon as you can.
Things are always with no communication. With each payment you miss, late fees will be applied. Those fees can be up to $25 to $40 if you’ve been late before.
After 30 days, your payment is considered missed and the account becomes delinquent. The credit card company will report the delinquency to the credit bureaus. Each month you miss will create a negative notation in your credit history that will remain for seven years.
The account will also be listed as delinquent until you catch up on what you owe. All of this can seriously damage your credit score. Generally, after about 180 days of nonpayment, the account will be charged off. This means the account will be closed and sent to collections.
At this point, the creditor or collector has the right to sue you in civil court. If you don’t show up or you lose the court case, they can do things like garnish your wages. That’s why it’s so important to do everything possible to pay what you owe.
If you’re having trouble making a payment, call the credit card company before the payment is late. If you have accounts that are behind or you’re just finding that the debt is overwhelming, speak with a credit counselor and discuss what options are available to help you get relief.
Get a free debt and budget evaluation from a certified credit counselor.