The Consequence of Late Payments

Many people are struggling every month just to make ends meet. Some individuals fall behind on their credit card payments and find, to their dismay, that these late payments adversely affect their credit rating. Credit repair is available to help these hardworking individuals to stop the vicious cycle of late payments (and the resulting fees) and to create a feasible plan to begin walking toward becoming debt free.

Why Late Payments Hurt Credit
When you sign a contract with your credit company, you agree to pay a minimum payment every month to keep your account in good standing. When you fail to make a payment on time, it is as though you are receiving a strike against your good name. Not only does this result in late fee penalties from your creditor, but every time you make a late payment, it has the potential to be reported by your credit agency to organizations that will then lower your credit score.

Revolving Accounts
There are three primary late payment categories for revolving (credit card) accounts that will do damage to your credit report:
* Under 30 Days - These late payments are not generally reported to credit agencies, though they are likely to invoke costly late payment penalties on your account.
* Between 31 & 60 Days - These infractions are reported and can affect your credit score for up to 12 months. If you have only one or two late payments that are in this time frame, they are not likely to do much damage to your score. However, continuous late payments in this time frame indicate a pattern of non-payment that can cause your score to suffer a great deal.
* More than 60 Days - Late payments made after 60 days are considered serious offenses and hurt your credit score considerably, for up to seven years. Creditors consider you a risk if you have even one late payment over 60 days and are likely to charge you higher interest rates on loans or even deny your applications for new credit accounts.

Mortgage Payments
Late payments made on mortgages do not bring down your credit score much more than revolving accounts, however, they seriously affect people applying for new mortgage arrangements.
* 1 Month - If you make a late payment within one month of the due date, you can expect penalty charges from your bank, but it will probably not be reported on your credit history if late payments of this nature occur only once or twice.
* 2 Month - Once you cross the 30 day threshold, you can expect your credit score to plummet between 50-100 points as a result of late payment. Technically, your mortgage company can call for foreclosure proceedings to begin at this point, though they rarely opt for this course of action during the second month of non-payment.
* 3 Month - When you get past the three month mark, expect your scores to continue to drop. When you reach the 120 day mark, foreclosure proceedings are almost certain.
Late payments can severely affect your ability to purchase a car or home, or even to qualify for certain employment positions. Keeping late payments to a minimum is of the utmost importance.

How to Solve Late Payment Problems
If you find that you are unable to make monthly minimum payments to several credit card companies every month, the worst thing you can do is ignore the problem. In a very short amount of time, your credit can fall from great heights and become difficult to repair.

Credit repair agencies exist to step in and safeguard you and your family against spiraling down into bad credit scores. There are several different credit repair plans to choose from, whether it be debt consolidation, settlement or aggressive personal budgeting. In addition, credit repair agencies can go to work immediately for you in order to have your late payments removed from your credit report. In a very real way, credit repair services can put an end to the stress and worry that is commonly experienced by men and women who find their credit slipping into oblivion.

Inaction is the worst possible move to make when your late payments begin to pile up on top of one another and your creditors threaten to report your negligent account activity. The problem will not go away on its own. Contacting a credit repair agency is the first step toward securing or improving your credit rating. Seasoned professionals can use the business relationships they have established with many creditors in order to work out a solution for your late payments and their consequences.