Missing a credit repayment can happen to everyone – but don’t be tempted to skip or delay your monthly repayments.
Late or missed repayments stay on your credit report for at least six years, so it’s not hard to see how important it is to stay on the right side of repayments. Your credit report can show you if you’ve missed some payments on cards or loans you have.
What happens with missed or late payments?
If you apply for new credit, and lenders see late or missed payments on credit agreements with other lenders, they may be concerned that you will miss payments to them too.
Late or missed payments in the past six years are likely to impact your credit score, meaning that any credit you do apply for and manage to get might cost you more money.
Credit scores of course weigh up lots of different pieces of information, and if everything else on your report and application form is favourable, it need not be a deal-breaker. If you accidentally do miss one, you can explain it by adding a “notice of correction”, which is a statement of up to 200 words. And as your late payments become older they reduce the negative effect on your Experian Credit Score.
By monitoring your credit report, you could spot if you’d missed some payments on cards or loans you have. Find out more about it here.
And if you have a 0% balance or purchase deal, don’t let that fool you into missing a payment, as it could invalidate the promotional rate from then on, meaning you’d start paying interest on the balance.
Some tips to help ensure you don’t miss payments:
- Set up a direct debit so you can make a payment as soon as you get a statement or a notification
- Changing your payment date to a time that is more suitable (after pay day is usually a good one).
- Get reminders by text or email to help alert them to the next credit payment due.
If you find that you are in financial difficulty and struggling to make ends meet, the most important thing is to deal with it as soon as possible. Speak to debt advice charities such as Stepchange, talk to lenders, and ask for help.