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A delinquency is a late payment that can appear on your credit report once you're 30 days or more past due on a debt. The consequences of a delinquency can be severe when it comes to your credit score.
If you're having difficulty paying your bills, becoming current on your account can be challenging. But understanding how and when creditors report delinquencies and how they appear on your credit report can be helpful as you resolve the issue.
What Are the Potential Consequences of a Delinquency?
Delinquent payments remain on your credit report for seven years from the original delinquency date, and even one 30-day late payment can damage your credit score. Of course, the more payment due dates you miss, the greater the negative impact is on your credit score.
The presence of one or more delinquencies in your credit history can trigger serious harm to your credit scores. That's because your payment history is the most influential factor in your VantageScore® as well as your FICO® Score☉ , which is the credit score used by 90% of top lenders.
This credit score harm can have far-reaching consequences, including:
- Less access to credit: A lower credit score can make it harder to qualify for traditional loans and credit cards, especially with the best rates and terms.
- More difficulty renting an apartment: It may be more challenging to rent an apartment with poor credit. Landlords may have a minimum credit score they require to allow a tenant to rent an apartment. Even if approved, you may be asked for an additional deposit.
- Impact on rental or home insurance: Most states allow insurance companies to use credit-based insurance scores when deciding whether to insure you and at what rate.
- Deposit requirements for utilities: Utility companies may charge hefty deposit fees for customers with below-average credit.
How Can You Find Delinquencies in Your Credit Report?
The easiest way to spot delinquencies on your credit report is to review the payment history for the accounts listed there. Accounts that show late payment history will be listed first on an Experian credit report. Your payment history on your credit report shows whether your payments were made on time or late. Late payments are usually displayed in red, along with a number representing how late they were (30, 60, 90, 120+ days).
The best way to discover more information about a delinquency you find on your credit report is to refer to your billing statement or contact the creditor that reported the delinquency. Make sure you understand the reason for the delinquency and verify it was reported accurately by the creditor.
If you think a delinquency on your credit report has been reported by a creditor in error, you can dispute the information with the credit bureau listing the discrepancy. Additionally, you can contact your creditor directly and request an investigation into the matter. If the company finds they erroneously reported the late payment, they can contact the credit bureaus to remove the incorrect information.
You can submit a dispute with the three major credit reporting agencies—Experian, Equifax and TransUnion—online, by phone or by mail.
How Can You Avoid Delinquencies on Your Credit Report?
When it comes to delinquencies on your credit report, a little prevention is worth a pound of cure. By employing some of these strategies, you may be able to avoid late payments and keep your credit report clear of new delinquencies:
- Check the status of your bills regularly. Choose a day and time to review bills to make sure you don't miss a due date. For example, you may decide to review bills every Sunday evening to see what bills are due that week.
- Set alerts and reminders. You can set alerts on your smartphone or enable text or email reminders for your various accounts. That way, you'll never miss a due date.
- Enroll in autopay. When you enroll in automatic bill pay with your card issuer, they will withdraw the amount you specify from your checking account and use it to pay your bill on a certain date.
- Build an emergency fund. You can use money from your emergency fund to pay your credit card bill when there's not enough money in your budget that month.
- Contact your creditor to discuss options. When you're under a financial strain and worry you may miss a bill payment, contact your creditor immediately to discover your options. For example, they may be able to move your due date to buy you some extra time to make your payment.
The Bottom Line
Remember, even if you're several days past due and facing a late fee, that doesn't mean the delinquency will be reported to the credit bureaus. A delinquency is when your account is late by 30 days or more. At that point, your creditor may report your delinquency to one or more credit bureaus.
Not sure if there are delinquencies or other harmful marks in your credit report? Get your free Experian credit report and credit score to get a clearer picture of your credit.