Miss a month, pay a lot
By Jeremy M. Simon | Published: May 25, 2007
It happens to many of us. Bills arrive in our mailboxes and we set them aside. But then life intervenes and we end up forgetting to make payments. In the case of credit card statements, forgetting to pay a single bill could leave you with bad credit -- which could end up costing you plenty.
Consumers may figure that missing a credit card payment is no big deal. They may be upset about getting hit with a subsequent fee, but figure that is the only financial pain they will endure as a result of their forgetfulness.
Unfortunately, paying your credit card bill late can cost you a lot more than just a one-time fee. In fact, due to the resulting hit to your credit, you may keep on paying for quite some time.
One of the factors that goes into determining your credit score (determined by looking at your credit history) is whether you were ever delinquent in making payments to lenders. If you have missed payments on your credit card, then you would fall into the category of consumers who failed to make a payment to their lender.
Just one delinquent credit card payment can be enough to cause your credit score to drop. As a result, depending on where you credit starts, forgetting a credit card payment could leave you in the credit score range for bad credit.
Once you end up with bad credit, the resulting cost could amount to as much as thousands of dollars in interest fees for borrowing money.
While the damage to your credit can happen quickly, it can take significantly longer to get your credit back to where it was beforehand. Make sure you keep up with your credit card and other loan payments, or the resulting bad credit could keep on costing you for a long time.
- 5 steps to rebuild credit after prison – Prison can wreck your credit; bouncing back takes work ...
- Bad credit? You’re still a target for identity thieves – Many consumers believe identity thieves won't touch them because of their poor credit. It's not true ...
- 4 questions to ask to score the best secured card – Know what to ask when shopping for a secured card to increase your chances to be approved while keeping your score intact ...