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What really happens if I miss a credit card payment?

Think it won’t matter if you’re a little late paying? We look at the repercussions

By Esther Shaw

Published: 25 August 2021

Man making credit card payment

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When using your credit card, it’s easy to think that missing the odd monthly payment here and there isn’t all that much of a problem. But this just isn’t the case.

Fail to make a repayment on time, and the implications can be serious. This is true irrespective of whether you miss a billing cycle, or are just a touch late paying what is due.

Here we take a closer look at what might happen.

Face a fee

First off, you could face an instant ‘missed payment’ fee of about £12.

While that may not sound much in isolation, if you make the same mistake several times, these charges could soon add up.

Risk losing your promotional offer

Missing a payment on your credit card can also cost you your 0% interest rate. This could mean losing the promotional rate on either purchases or balance transfers, or both.

Find yourself paying a higher rate of interest

If your 0% introductory offer gets withdrawn, you’ll end up paying more in interest. This will mean your card could get a lot more costly.

Get a blemish on your file

One of the biggest implications of a late payment is having it recorded on your credit report.

If a late payment leads to a default or County Court Judgment (CCJ) this could have a really serious impact on your score. Marks can remain on your record for six years.

Impact on your ability to get credit in the future

Your credit score is like a financial CV, setting out how reliable you are with credit. An overdue payment may send a warning sign that you’re struggling to manage your finances.

A tarnished credit rating can make it harder to get access to credit, such as cards, loans and mortgages further down the line.

And even if marks on your credit file don’t stop you getting accepted for credit, they could still mean you miss out on the most competitive rates.

The golden rule of credit cards is that you must make all payments on your plastic on time.

How can you ensure you never miss a payment?

  • Only apply for credit you can be sure you can comfortably afford
  • Budget carefully to ensure you have enough money to make your payments each month
  • Use calendar reminders to stay on top of your finances
  • Set up a direct debit to make sure your monthly repayment goes out automatically. To be on the safe side, arrange this so the money goes out a week in advance of the due date
  • Make sure this covers at least the minimum repayment, but aim for more if you can. If you clear your card in full each month, you’ll pay no interest at all
  • Have a safety net in place in the form of an emergency fund
  • If you are struggling to keep up with your minimum payments, speak to your card provider to see what help they can offer
  • Don’t bury your head in the sand if you have debt problems. Seek free advice as soon as possible. Try organisations such as National Debtline and StepChange

Keep a close eye on your credit report

The best way to ensure your credit score remains in tip-top condition is by regularly checking your credit report.

You can do this quickly and easily with our Credit Monitor tool.

The tool will also offer you tailored steps you can take to boost your score.

Steps include making sure you are registered to vote on the electoral roll, borrowing well below your limit on existing cards, and closing down accounts you no longer use. Read more here.

If there’s a valid reason why you were late making a payment on your credit card, such as being made redundant, you can get a ‘notice of correction’ added to your file to explain why this happened.

Things can improve over time

While details of late payments can be viewed on your credit report for six years after they were settled, this dark cloud won’t hang over you forever.

The impact that missed payments, defaults and CCJs have on your rating will diminish as time goes by, as lenders will be most focused on your recent credit history.

By being disciplined about keeping up with credit card payments going forward, you should see your score steadily improve – eventually making it easier to get access to credit, and at better rates.

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