If your credit card payment is more than 30 days overdue, your credit card issuer can report your late payment to the credit bureaus. When a late payment is on your credit report, it damages your credit score.
The extent of the damage depends on a few factors, including how late your payment is. But there are some steps you can take to address this and to prevent it from happening again.
How Long Do Late Payments Stay on Your Credit Report?
There’s no gentle way to say this, so I’ll be blunt: If you make a late payment that’s reported to the credit bureaus, it will be on your credit report for around seven years.
The worst part? Even after you pay the past-due bill, it remains on your report for around seven years starting from the original date of delinquency.
But there’s some good news, too. Over time, the negative impact on your credit score decreases.
[Read: Best Balance Transfer Cards]
How Do Late Payments Affect Your Credit Score?
Your payment history is a whopping 35% of your FICO score. One payment that’s more than 30 days late can make a once-excellent FICO score go down by 100 points or more. The higher your score, the bigger the drop.
The longer this goes on, the more damage to your score. While being more than 30 days late is bad for your score, being more than 60 days late is much worse.
Another issue with a missed payment is that a higher balance is reported to the bureaus, which can increase your credit utilization ratio. Credit utilization is 30% of your FICO score, and when your ratio creeps over 30%, that alone can lower your score.
Can You Get a Late Payment Removed From Your Credit Report?
If you’re at the early stage of delinquency and you have a good reason for missing a payment, call your issuer and discuss it. You can ask for mercy, but don’t expect it unless you have a good explanation for your tardiness.
I’m going to make a confession. Years ago, I missed a credit card payment by one day. I called my issuer and explained I had been in the hospital for an emergency. The issuer waived the late fee for me. I was fortunate that it was barely late and so it hadn’t been reported to the credit bureaus.
Here’s why it worked for me. I had a stellar payment history, a score over 800 and low utilization ratios, and I took action right away. Plus, I had a good reason for missing the payment.
So, don’t bother making the call to your credit card company if this isn’t your first late payment. Also, don’t call if your credit score has been trending downward. Never call attention to yourself when you’re not in the best credit shape.
How to Avoid a Late Payment
As you can see, even credit card experts make mistakes! No one’s perfect, so don’t beat yourself up over this. In my case, it was a wakeup call to automate my bill paying so it could survive emergencies. It’s never happened to me again.
It doesn’t have to happen to you, either. Here are some quick tips for making on-time payments.
— Set up reminders via email or text messages. Of course, a reminder doesn’t actually pay the bill. This is just to give you a heads-up that the due date is around the corner.
— Use automatic payments. Set up automatic payments to make sure you pay bills on time. When you get that text or email reminder, check the account you’re using for the payment to make sure there’s enough to cover the payment.
— Change your due date. If you get paid at the first of the month but your credit card payment is due at the end of the month, move your due date to coincide with your cash flow. Some issuers allow you to do this online, but if not, call customer service and make the request.
— Consolidate your debt. It’s easy to get confused when you have debt on several credit cards. Sometimes, aligning your due dates can fix this issue. But also consider transferring your debt to either a balance transfer card or getting a debt consolidation loan. You’ll get one due date, and you’ll also likely save money on interest.
— Track your spending. One reason people miss payments is because they overspend. When the bill’s due, they don’t have the funds to cover it. Pick a free money management tool online or download an app to track expenses and stay within a budget.
What If You Can’t Pay the Bill?
If you get behind and don’t have the money to make the payment at all, call your issuer. Ask for the hardship department and explain your situation. If you don’t take action, your account could eventually be sold to a collection agency. A collection account also stays on your credit report for seven years.
Hardship plans usually last about a year. During that time, the issuer might reduce your monthly payment or lower your interest rate temporarily to help you catch up.
But if your situation can’t be remedied that quickly, reach out to the National Foundation for Credit Counseling to get some direction. Simply reaching out and talking to a counselor will not lower your score.
The worst thing you can do in a financial crisis is to ignore it. Take action before you miss a payment. It takes courage to do this, but you’ll be glad you did.
More from U.S. News
How Long Does a Late Payment Stay on Your Credit Report? originally appeared on usnews.com