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Credit recovery/missed payments

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Payment history is the biggest factor used in scoring, so being late on a payment can bring your credit scores down. That said, it shouldn't be reflected in your credit history unless you are at least 30 days past due. However, your credit card company may assess late fees as soon as you miss the due date.

What to Do If You Miss a Payment

When you miss a payment and you rectify the situation quickly and make your full payment before it is 30 days late, you can likely avoid having the delinquency reported to the credit reporting companies. However, missing the due date and having a check returned still can be reported against you.

In addition to charging you a late fee, your credit card company may also charge a fee for the returned check, plus interest on the revolving balance. All these fees add to your credit card balance, which can make it harder to pay that balance and keep up with future payments.  Additionally, your bank may charge an overdraft fee. All those fees can add up quickly. 

The most important thing you can do now is bring both accounts current as soon as possible. If you haven't already done so, contact both the credit card provider and your bank to explain what happened, and make arrangements to get both accounts back in good standing.

When Are Late Payments Reported?

Any time a payment ends up being 30 days or more past due, the lender will likely report that delinquency to Experian. Once a late payment is reported, it will show in your credit history for the next 7 years.

Late payments have a significant negative impact on credit scores because lenders view them as a sign of financial distress. If your account is reported as past due, the best thing you can do to help your credit scores recover is to bring the account current and ensure all your accounts are paid on time going forward. 

The more recent a late payment is, the more it will affect your scores. If you use credit responsibly and keep your accounts current and your balances low, as time passes that late payment will affect your credit scores less and less. 


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