What happens if you don’t pay your credit card bill on time?
Always pay your credit card bill on time. You can also choose the autoplay option or you can also set payment reminders to pay your bill on time.
If you delay your payments, you can face many consequences.
A Credit card is likely one of the handiest financial products. It acts as a loan which later must be paid again. You can buy items or services according to your credit limit without instant payment.
Nevertheless, many users are unable to pay their credit card bills on time. You need to pay your bill by a certain time on the due date to avoid penalty. This is what happens if your credit card bill is delayed.
If you missed out a payment, your credit card company may send you a notice about your remaining payment These could be in the form of emails, telephone calls, letters, or texts.
This is What happens if you do not pay credit card bill on time
Late Fee or Charges
In case you delay your credit card payment, you’ll be charged a late fee. Your next billing statement may also include a fee for late or missed payments. Your late charges charged will rely on your credit card late fees policy or whether or not it has happened for the first time in the past six months.
Additionally, if your payment is late every month, you can be charged a late charge fee or lower than the minimum payment.
Decrease Your Credit score
A late fee can affect your credit score and affect your ability to take more credit in future. Your credit score rating drops after a late fee. The more longer your payment is due, the more your credit score will drop for your credit card. Additionally, you can make the payment and the late charges in case you are under 30 days late. This may help you keep away from any damage to your credit score rating.
Gets Added to your Credit Report
Late fee also impacts your credit score report. In case your payment is greater than 30 days late, an entry is added in the credit report. This entry can stay for 7 years.
Credit Card May default
In case your Credit card gets 180 days late, the card issuer will charge off your account and write it off as a loss. This stays for 7 years and the charge-off goes in your credit report.
Increase Your Rate of interest
Additionally, your rate of interest may also increase in case your fee becomes 60 days late. You’ll not simply be penalized with a late charge, but in addition, your rate of interest will increase to the penalty price, which is the highest rate of interest on your credit card.
Additionally, according to the terms of your credit card, the purchases which you make after the penalty rate turning into efficient should obtain the higher rate. You may also not have the ability to cash in any rewards if your card becomes delinquent.