By now, most people know how important it is to pay their credit card bills on time. However, they may wonder why this is necessary. When someone is trying to take control of their financial life, paying bills on time is a must. It is essential to know when bills are due and get into the habit of paying them on time – every time. Not only is this going to reduce a person’s stress, but it will also help to maintain their financial health.
While the positive aspects of paying credit card bills on time should be enough, some may wonder if there are potential ramifications if they don’t pay their bill.
If someone fails to pay their credit card bills on time, they may face higher interest rates, late fees, and damage to their credit score. If someone keeps missing payments, they can face other financial issues. Their card may be frozen, they may receive calls from a collection agency, and there could be the possibility that the debtor is sued. With help and services from Debthunch, this can be prevented; however, knowing the potential consequences can be helpful too.
What Happens After Missing One Payment?
There is a negative impact after missing a single credit card payment. A person will incur interest in the purchase they made for any missed payments. This is the case if the full amount is not paid off, too. Along with these issues, a person is also going to see a late payment fee added to their balance, which can be up to $40.
If this is a person’s first missed payment, they may be able to convince the credit card company to waive the late payment fees and restore the APR period. However, make sure to contact the bank or credit card company to explain what is going on. The longer a person waits, the more likely they will face these fees and charges.
Skipping Several Payments
After three months have passed and all the payments have been missed, even more, late fees will be added. The credit card issuer may also report the account to the main credit bureaus as being delinquent, which means a person did not make the minimum payment in a timely manner. It is important to remember that some of the stricter card issuers will report delinquency after a single missed payment. This is delinquency that is going to damage a person’s credit report and stay on their credit history for at least seven years.
Maintaining Good Credit
If a person wants to maintain good credit, they need to make sure they are making their credit card payments in a timely manner. If they fail to do this, they may face the consequences mentioned above, among others. Being informed and knowing the issues that may arise will help ensure that a person maintains good credit and that no serious issues arise. In some cases, working with professionals will help ensure that a person can maintain good financial health.