HOW A LATE PAYMENT AFFECTS YOUR CREDIT
Most of us are aware that paying your bills late is not something you want to do. It can have a negative impact on your financial health and future and can start a spiral of unhealthy financial or spending habits. Yet, most people do not know how late payments are even reported to the credit bureaus. Late payments are not even reported until they are 30 days late, so you have thirty days to actually make the payment before it starts to negatively affect your credit. A 30-day-late payment can land on your credit report and cause your credit score to drop, though the long-term damage may be minimal. After that, the late payments are updated again when they’re 60 days and 90 days late. Once a payment is 120 days late it can be sold to a debt collection agency and damage your credit score even more. So just because you are a few over days overdue on a bill, you should still pay it and it will not affect your credit score! When you allow a debt to go unsettled for any longer than 30 days it WILL negatively affect your credit score. These negative items on your report will stay there for seven years and will be very hard to get removed or explain to many creditors when you are applying for new lines of credit. The later the payment, the more damage it will cause, you do not want your late payments being sent to collections.
It is important to remember that if you do have a late payment, just pay the amount due as soon as possible and do not be afraid to call the company and explain your situation and ask for your other options. Learn your lesson and do not make any more late payments in the future!
Information pulled from: IdentityIQ - https://www.identityiq.com/credit-monitoring/how-to-help-protect-your-credit-health-when-you-missed-a-bill-payment/
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