When Do Credit Cards Report Late Payments?
No one likes to be behind on their payments. And hardly anybody falls behind on purpose. But Americans still saw historically low levels of credit card payments in the US in 2020. Who can blame us? We are facing a recession and other economic turmoil. But that doesn’t change the fact that we need to figure out how to stay financially responsible. And that involves being informed about our credit reports. So if you missed a payment, you may be asking yourself when credit cards report late payments. Well, they usually report to credit bureaus if you are at least 30 days past the due date, but certain creditors extend that timeframe. And – good news – not every late payment will hurt your credit score.
Find out how and when creditors report to bureaus, how late payments affect your credit score, and if you can get some sort of grace period.
Late Payments: A Rundown
How do your payments, both on-time and late ones, get listed on your reports?
Credit bureaus are the institutions in charge of listing your financial information on your credit reports. When you make or miss a payment with your creditor or lender, they report that information to credit bureaus so they can make changes to your reports.
Late payments get added to reports at least 30 days after the payment’s due date. Certain credit card agencies and lenders report late payments 60 days after the due date. You can always contact your creditor and lender and ask them about their policy for reporting late payments so to know what timeframe you’re dealing with in the future.
When talking about late payments, we should also tackle the subject of ‘grace periods.’ If you are just a few days or weeks behind on your payments, some creditors may not charge any dreaded ‘late payment fees.’ That’s called giving debtors a grace period. But not every creditor is that empathetic. Some charge extra costs as soon as you miss the due date.
Grace period or not, your biggest concern should be making the payment in full before the creditor’s deadline for reporting your late payment. Because after that 30-day (or 60-day) mark passes, that late payment will go straight to your report and stay there for the next 7 years! And it doesn’t even matter if you catch up, a.k.a. make the full minimum payment before your next payment due date!
Whatever your case is, the sooner you dispute these inquiries, the better your chances for a quick credit repair process. At White, Jacobs and Associates, we offer support and a whole team of experts ready to navigate you through this often confusing process.
How Late Payments Affect Credit Scores
As one would expect, late payments can hurt credit scores. But the scope of the impact comes down to a few factors.
Let’s clear something up before we go on. We already mentioned that late payments which have not reached the bureau-reporting threshold (30-60 days) do not get listed on your credit report. That is because creditors refer to those late payments as ‘current,’ a.k.a. still being considered a payment that isn’t late. So that’s why your credit score isn’t get impacted by late payments that are just a few days late – only late payments that show up on your credit report affect your credit score.
Now, let’s say your late payment got reported to the bureau because the 30-60 threshold has passed. Somewhat contradictory, your credit score may suffer a sharper plunge if you previously had an excellent credit history. And if you already had bad credit and several late payments, your credit score may dip just by a few points. That may seem unfair, but it is how it is.
Next, the more you are behind on your payments, the bigger the dent in your credit scores. One 30-day late payment won’t damage you as much as an account that’s 120 days past due.
And remember how we mentioned that a reported late payment stays on your report for 7 years? After that time has passed, the late payment gets relabeled and stops impacting your credit score!
I Had a Late Payment Reported in Error – What Should I Do?
If your creditor or bureau mistakenly reported/added a late payment, you can dispute that payment. Disputing a payment means asking for it to be verified as an error and removed. You can do this yourself, but it won’t be easy. Or you can find the best people in the business to help your case. White, Jacobs and Associates has a team of credit wizards with a track record of successful disputes.
All you need to do is book a free assessment with their team, provide them with proof of error, and sit back while they do their magic. White, Jacobs and Associates doesn’t let their clients suffer 7 years of bad luck because of someone else’s mistake.