Paying your bills on time is the most important thing you can do to build and maintain good credit scores.
If you do have a mishap and pay one of your accounts late, that "past due 30 days" notation will remain on your credit report for seven years. The seven-year period begins from the original delinquency date.
If you have kept this account open, seven years from the original delinquency date that late payment will be removed. If the account is paid off and closed, the entire account will be removed seven years from the date of that missed payment, or original the delinquency date.
Here's how late payments affect your credit scores. Even one missed payment could have a negative impact on your credit scores initially, which is why it's so important to pay at least the minimum payment on your loans and credit cards every month. The good news is, if you did pay late, the impact to your credit scores will diminish over time.
The most important thing to do if you miss a payment is to make a payment to get the account current, then continue to make at least minimum payments on time. It can help to set up an automatic payment for the minimum amount due on or before the due date to make sure you are never late on that account again.
Then, pay as much of your account balance as you can afford every month, to pay down your balance. Paying only minimum payments every month will not help you pay off debt. Read more here about why you should pay more than your monthly credit card minimum.
How Long Will A Late Payment Affect Your Credit Scores?
Credit scores are designed to detect patterns of behavior. So even though one late payment will cause your scores to decrease, it is not likely to have a long-lasting negative impact. If you continue to use credit wisely and demonstrate to lenders that you can manage it well, your scores will begin to climb back up.
To learn more about late payments and how they affect your credit scores, check out these additional articles:
- Do Companies Report a Late Payment If It's Only a Few Days Late?
- Late Payments Not Deleted After Accounts Paid Off
- Can 1 30-day Late Payment Hurt Your Credit Score?
You can get more information about how to monitor, protect and manage your credit at experian.com/education. If you have questions, submit them through Experian's Facebook or Twitter with the hashtag, #AskSusie. You can also email me your questions directly at AskSusie@experian.com and I will answer them here.