Missing a credit card payment can be frustrating, whether you saw it coming or not. Repercussions, ranging from fees to credit score impacts, may impact your finances. Understanding what comes next and how to respond is critical to successfully navigating a missed credit card payment.
Let’s examine what happens if you miss a credit card payment, potential penalties and how to minimize the consequences.
What counts as a missed credit card payment?
In general, credit card payments are considered late if they aren’t received by 5 PM on the payment due date, based on the time zone listed on your credit card statement. However, if your payment due date falls on a Sunday or a holiday, you typically have until the same time the next business day to make your payment on time. After that, it’s considered late.
The challenges of missing a credit card payment
If you miss your credit card’s payment due date, you may:
- Have to pay a late fee: These vary by issuer but generally apply right away.
- Lose your credit card grace period: Your grace period is the time during which you can avoid interest, and it lasts from the end of your billing cycle to your payment due date. Losing that would cause interest to accrue on purchases, increasing your credit card costs.
- Be charged a penalty APR: This rate is higher than your card’s purchase APR and would apply to future purchases.
Your credit card issuer may also report the late payment to the credit bureaus, which can impact your credit score.
When does a missed payment affect your credit score?
Missed credit card payments are typically reported to the credit bureaus once they’re at least 30 days past due. Payment history is one of the most important factors in calculating your score. Even a single late payment can have a negative impact on your score.
Keep in mind that missed credit card payments generally stay on your credit report for 7 years. However, the more time passes, the less impactful a missed payment will be on your credit score, especially if you maintain good credit habits.
What to do if you miss a credit card payment
If you miss a credit card payment, there are 4 key steps you may take to help minimize the impact:
Make the payment as soon as possible: Paying quickly may help you maintain your credit score if it means the late payment isn’t reported to the credit bureaus. If your payment is already at least 30 days late, keep in mind that the longer it goes past due, the greater the impact it will have on your credit score.
Contact your issuer: Though not guaranteed, your issuer may be willing to waive their late fee or even reverse some of the penalty interest charges. Your chances may be better if you’ve had a strong payment history prior to this payment, or you’ve been a long-time customer.
Check your statement for a penalty APR or changes: Knowing your purchase and penalty APRs can help you decide how best to use your credit card based on your financial goals.
Monitor your credit if the payment was 30 or more days late: If your payment is reported to the credit bureaus, it’s important to know exactly how that is impacting your credit score. This is especially important if you plan on applying for new credit in the near future, as it may affect your options.
How to avoid missing a credit card payment
Once you’ve addressed the late payment, it’s important to take steps to avoid future missed payments. Here are a few ways you may do that:
- Set up payment reminders or autopay: Depending on your credit card issuer, you may have the option to set up payment reminders to help you maintain on-time payments, or you may choose to set up autopay for added convenience.
- Align your due date with your payday: By making credit card payments close to your payday, you help ensure that you have the funds to make those payments. That can also help you budget around your financial obligations.
- Review your statement monthly: This can help you track your credit card balances and due dates, which may help you be better equipped to keep up with future payments.
Missing a credit card payment isn’t ideal, but by taking steps to minimize the impact and avoid future missed payments, you can help get your finances back on track.
Disclosure: This article is for educational purposes. It is not intended to provide legal, investment, or financial advice and is not a substitute for professional advice. It does not indicate the availability of any Citi product or service. For advice about your specific circumstances, you should consult a qualified professional.
