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Can One Late Payment Affect My Credit Score?

Written by Equifax Experts on February 7, 2014 in Credit  |   18 comments

Under certain circumstances, such as a job loss or illness, late payments may be unavoidable. Since payment history is weighted heavily when calculating your credit score, it’s important to understand the impact that these late payments may have.

information on my credit reportEven if you normally pay your bills on time, an unexpected financial emergency, a lost job, or even a simple oversight could cause you to fall behind on your payments.

If you miss a payment on one of your credit accounts, be it a credit card, mortgage, or other loan, you could see your credit score drop. As a result, lenders may view you less favorably.

Lenders use the information on your credit report to gauge your risk as a borrower, and your payment history has the strongest impact on your credit score. While a history of on-time payments suggests you are a consumer who will likely repay your debt on time, a history of late payments could suggest to creditors that you are a risky borrower.

If you have a payment that is more than 30 days late, your creditor may report it to the credit reporting agencies (CRAs). In this case, the late payment can show up on your credit report and be factored into your credit score. Late payments will be listed on your credit report depending on how late they are: 30 days late, 60 days late, 90 days late, 120 days late, 150 days late, or charged off.

But how much of an effect does one late payment really have on my credit score?

The degree to which a late payment may affect your credit score can depend on multiple factors. When it comes to your FICO credit score, for example, a late payment will be evaluated based on how severe it is, how recent it is, and how frequently you’ve paid late.

Each credit reporting agency has its own model for evaluating your information and assigning you a credit score, so your scores will vary between the agencies. You should also know that your credit scores are updated each time there is a request for a score, and new information received impacts the model.

In general, though, the longer a bill goes unpaid, the more damaging the effect it has on your credit score. For example, all other things being equal, a payment that is 90 days late can have a more significant negative impact on your credit score than a payment that is 30 days late. In addition, the more recent the late payment, the more negative of an impact it could have.

One late payment could have a more significant impact on higher credit scores. According to FICO data, a 30-day delinquency could cause as much as a 90- to 110-point drop on a FICO Score of 780 for a consumer who has never missed a payment on any credit account.

In comparison, a consumer with a 680 FICO Score and two late payments (a 90-day delinquency on a credit card account from two years ago and a 30-day delinquency on an auto loan from a year ago) would experience a 60- to 80-point drop after being hit with another 30-day delinquency.

If you miss a payment (even just one) on one of your credit accounts, the late payment could remain on your credit report for up to seven years. If you fall in the habit of paying late, your account could be charged off or sent to collections, which could further dent your credit score.

In addition to lowering your credit score, a late payment could also cost you in the form of late fees and higher interest rates. If you pay your credit card bill even one day late, for example, you could be charged a late fee. Your creditors may also raise your interest rate if you regularly miss payments, which would mean you’d have to pay more money in order to carry a balance.

I’ve missed a payment. What should I do now?

If you do have unpaid bills, consider taking these five steps take to help you gradually improve your creditworthiness over time:

1. Make a budget in order to pay off bills as soon as possible. Because a late payment can cause more damage to your credit score the longer it goes unpaid, the sooner you can pay it off, the better.

2. Continue on-time payments on your accounts that are paid as agreed. If you find yourself late on one of your credit accounts, stay current with all of your other accounts.

3. Consider automatic payments or electronic reminders. This can be particularly helpful if paying your bills tends to slip your mind. You can also set email or text message reminders to help you stay current with your accounts.

4. Contact your creditors to work out a payment plan. If you know you are going to be late on one of your accounts, a payment plan may help you avoid a blemish on your credit report.

5. Regularly monitor your credit report. By doing so, you can keep tabs on your payment history and ensure that late payments fall off of your credit report after the appropriate amount of time has elapsed. If you want to see how certain credit actions, such as late payments, could affect your credit score, consider enrolling in an Equifax credit monitoring product in order to access Equifax’s Interactive Score Simulator.

18 comments

  1. Anonymous says:

    Thank you Equifax for your kind reminder. I am trying to avoid late payments like the plague, and have succeeded thus far. Thanks again for your reminder,
    Keith Van Soest.

  2. ken says:

    I have missed a car payment 1st one ever. Due to a computer error of making an online payment, can they take the late payment record of of my report?

    • Cletus Davenport says:

      Ken,
      If you fixed the computer online payment error and made the payment within 30 days. Then, there should not be a late payment on you Credit Report. You still may have to pay a late payment fee. I hope this helps.

      Cletus,
      low score 590, now 725

    • Al says:

      You have to prove that there is an error and maybe, just maybe they will take it off. Most companies are reluctant to admit errors because they get rated also and of course…they don’t make errors.

    • David says:

      Ken, if the error was on the part of the lender, you should sit down with the lender and try to straighten it out. If that doesn’t help, file a dispute with the credit agencies. But by all means, be sure to pay all future bills in time. Eventually, that one missed payment will have less and less of an impact on your FICO score.

  3. Mike M says:

    If a payment is a week late is it reported as late?
    Thanks for the info.

    • Cletus Davenport says:

      Mike,
      Creditors normally only report late payments greater than 30 days late or greater to the Credit Reporting Agencies(CRA). You still may be charged a late payment fee, but that is only between you and your Creditor,not CRA. I hope this help you out.

      Cletus,
      Score was 590, now 725

    • Al says:

      Companies will tell you that it is not reported late until after 30 days from payment date. So I wonder why it shows up as late on the FICO or whatever the loan company receives as credit data? If you notice they hardly ever show you what they get because their report is different than what you get from the reporting companies (you know the ones you are entitled to see). Just ask them and compare. It seems that you should be legally entitles to see exactly what they get…just ask them.

  4. Concerned says:

    I think it is counter-productive to keep one late payment on a person’s credit report for up to 7 years. A person who has never had a late payment, and then, due to illness or job loss has a bad month, has little incentive to try to recover from a lower credit score that will result in higher interest rates and other late payment sanctions that serve to hinder their financial recovery. If a person declares bankruptcy, then 7-10 years later, the information can be removed from their credit report. However, if the person tries to pay off their bill in a timely manner, then the 7 years of credit report recording of the delinquent account(s) begins when the last transaction/payment is made. In this case, the information will continue to appear on a person’s credit report long past seven or ten years from the date of the delinquency

  5. William says:

    I had an autopay setup with HSBC on an account with a very low balance. HSBC stopped the autopay after 6 months. I was unaware and the account with only a balance of $200 went late. I received no calls from HSBC until the account was well over 30 days late. Despite my pleas to HSBC to consider its actions, HSBC refused to withdraw the mark on my credit. It’s the only mark of its kind on my credit for the last 30 years, and unfortunately it happened less than two years ago.

  6. Anonymous says:

    I forgot to pay about $60 for 60 days in one of my credit accounts 2 years back.. when will I see my credit score going up?

  7. Sidney says:

    Can the creditor remove the late payment before 7 years

    • EFX Moderator_KB says:

      Sidney, the length of time information remains on your credit report varies. Accounts paid as agreed will generally stay on your credit report for up to 10 years from the date of last activity. In general, negative information will stay on your credit report for seven years from the date of last activity. Click here to learn more details about how long it could take for a creditor to remove a late payment. I hope this helps and thanks for posting.

  8. Anonymous says:

    Mike M – it’s “late” to the creditor, but a credit report will not show anything that does not hit the 30-day mark.

  9. Ron W. says:

    My Credit Score was 813, it dropped to 660 as one mortgage payment was late.

    Here is what happened. In Nov 13, I was out of country for 3 months, during that period Mortgage Company realized that they didn’t accrue my escrow correctly so decided to change my monthly installment. Which I was not aware of as I didn’t have access to my mail.

    My bank sent them the payment with old amount which the mortgage company did not apply. By the time I returned, it was already 30 days past due. :(

    So, in spite of having impeccable credit record, I will have the late payment for next 7 years. And years to restore my credit score for no fault of mine. :(

  10. B. Leonard says:

    I can say from experience that a payment made even one day late will show up on your credit report. However, unless you make more than one slightly late payment per year per account, it should have a minimal effect on your score. What really hurts are repeated late payments on an account and/or paying 30 days or more after the due date.


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