http://www.debts.org/index.php en info@debts.org Copyright 2008 2008-12-01T15:28:00+00:00 http://www.debts.org/11/index/consequences_of_late_payments/ http://www.debts.org/11/index/consequences_of_late_payments/#When:14:20:00Z If you have missed a credit card payment and think the only consequence is a late payment fee, you may be in for a shock. Debts have compiled a list of five things that happen when you miss a credit card payment.1) Late fee. If you have missed a credit card payment you will receive a penalty of $15 to $35. Many people who miss credit card payments are prepared for the resulting penalty but not everyone is aware of the other consequences. 2) Interest rate increase. Lenders will often jack up interest rates following a default of any kind, ie, a missed payment, inadequate payment or late payment. If you have transferred a balance or are otherwise enjoying a low interest rate for an introductory period, a late payment will ensure you lose the low interest benefit and pay the generic rate instead.3) Multiple interest rate rise If your lender has a ‘universal default ‘clause in your credit card agreement your missed payment could have a nasty knock on affect across all credit cards. Interest rate rises on one could mean interest rates rise on all credit cards.A ‘universal default’ is when a lender enforces default terms on a borrower because they have a patchy history with other creditors. 4) Credit bureaus are notified Credit bureaus are always notified whenever a payment is more than 30 days late. A credit card default is kept on your credit file for seven years.5) Credit score Because payment history makes up 35% of your credit score, late payments can have a significant effect on your score affecting your ability to get new credit in the future.Late Payments and Your Credit ScoreLate payment fees and higher interest rates are undesired results of late credit card payments. Perhaps, the effect you most want to avoid is a hit to your credit score. What does a late payment really do to your score?According to Credit.com, the credit score calculation doesn’t treat all late payments the same. While thirty- and sixty-day late payments affect your credit score more in the months they occur, their effects diminish over time as long as they’re isolated incidents. A ninety-day late payment, on the other hand, is more harmful to your credit score, especially if it occurred within the past 24 months.This means… Missing one payment for one or two months won’t be so bad for your credit score. Missing several payments for one or two months is worse. Missing a payment for three months just one time is just as bad for your score as a charge-off or collection.Make yourself at home in our Forum and find out what everyone else in America thinks about credit cards. There is also our up-to-date News section for all the latest on personal finance. If you need help finding a provider or would like to review a company, please don’t go without checking out our A-Z directory. Consequences of late payments 2008-07-08T14:20:00+00:00