It might be the cardinal rule of payments: they have to happen on time. When they don't, it can be for any number of reasons when life gets busy, or stressful, or sad. When a payment is late, it sends a signal to creditors that you're not doing all they'd like to hold up your end of the agreement, however. And that can do damage to your credit scores. Whether it's part of a loan repayment plan or a credit account, falling behind on your payments is one of the fastest ways to hurt your credit. Learn more about how late payments harm your credit scores.
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Welcome to Credit 101: simple answers to the most common credit questions like: "Will one late charge affect my credit report?"
How much late payments can affect your credit report is difficult to measure, because each credit scoring model is different. But the following factors can help in gauging the impact of a late payment:
- the later you are with a payment, the more it can impact your credit
- the more recent the late payment, the more detrimental it may be to your credit
If you are late on payments to several creditors in the same month, it can have a bigger impact on your credit. Also, if you're frequently late to the same creditor it can impact your credit more than if you're late just once. One late payment isn't good, but it's better than several because it's usually easier to rebound from. The more you can make payments on time, the better.
If you have a credit question, tweet us @Experian_US, and we'll answer it. Maybe right here on the next episode of Credit 101.