What Should I Do About Delinquent Accounts?

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Dear Experian,

I have missed a payment of $18 on my credit card. This was my first late payment on any card. This month, my credit score dropped by 128 points and it is showing one delinquent account. Is that $18 late payment the reason? Can it be removed? It seems awfully ridiculous to penalize someone so much for so little!

- PMC

Dear PMC,

Whether your credit report shows one late payment or many, the steps for helping your credit recover will be the same. The first thing to do is make sure to bring all delinquent or past due accounts current.

Once you have brought your accounts current, focus on making sure no payments are missed in the future. It can take time, especially if you have had multiple late payments or more serious delinquency, but making all your payments on time going forward will help your credit begin to improve. Keep in mind that the further in the past a late payment occurred, the less it will impact your credit scores.

Impact of Delinquent Accounts on Your Credit

When you miss a payment on an account, the creditor reports the delinquency to Experian. Even a single late payment for a relatively small dollar amount can cause a significant drop in credit scores. That's because your payment history is the most important factor in calculating your scores.

Late payments remain on a credit report for seven years, but if this is your first missed payment, try not to be too discouraged. Missing even a single payment is viewed by lenders as a sign of financial distress, so your credit scores will reflect that. However, your scores should bounce back over time after the delinquent account is brought current again and your credit history stabilizes.

Thanks for asking,
Daniel Sayre, Client Services Manager

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