How Long Do Late Payments Stay on Your Credit Report?

Nobody intends to pay their bills late, but it can happen to anyone. The good news is that every late payment doesn’t necessarily mean the end of the world. Depending on how late the payment is, the consequences may be reduced by acting fast and communicating with your lender.

Here’s how late payments could affect your credit score, how long the effects may last, and some tips to repair your credit score after a late payment.

What happens to your credit score when you make a late payment?

Payment history is the most important factor in two of the most common credit scoring models: VantageScore® and FICO®.¹ One late loan or credit card payment could potentially impact your credit score, but not necessarily right away. Lenders may not report a late payment, sometimes called a delinquent payment, to the credit bureaus until it’s at least 30 days overdue. After 30 days, a late payment may appear on your credit report, although this can vary by lender and loan type.² If your full payment is received and credited no more than 29 days after the due date, a late payment may not appear on your credit report at all. However, you may still owe a late fee depending on when you pay and your lender’s policies — some lenders may offer grace periods of a few days after the due date.

If you miss multiple payments in a row, the lender may charge off your account, which means the lender has written it off as a loss. Even so, a charged-off debt is still the responsibility of the borrower. The debt may go to a debt collector, which could further impact your credit score.

Remember that lenders don't have direct control over your credit score. Lenders simply report late payments (along with other account information) to the credit bureaus who create your credit reports. Credit reporting agencies then generate credit scores based on the information lenders report.

How long do late payments affect your credit score?

A late payment may stay on your credit report for seven years, though its influence over your score may shrink over time.³ If you have multiple delinquencies, you may see a greater negative impact on your credit score.

The longer a bill goes unpaid, the more it can affect your credit score. So, even if you’re over 30 days late, try to pay the bill as soon as possible to avoid further impact on your credit score.

If you believe a late payment on your report isn’t accurate, you may take steps to dispute and correct a credit report error. But if a delinquency is accurate, it may take some time to rebuild your credit.

What should I do if I missed a payment?

If you’ve fallen behind on a payment, you have options. How much a late payment affects your credit score depends on the actions you take to address it and how quickly you make a payment. For example, if you have multiple accounts in collections, bringing one of them current may not have an immediate positive effect on your credit score, but may still help your financial health.

The following steps may help you minimize the negative effects of paying late:

1. Contact your lender

Many lenders understand that people go through tough financial times. If you contact the lender and explain your situation, they might be willing to work out a payment plan with you. In some cases, if you’ve missed multiple payments, you may be able to settle the debt for less than you owe. If you’re concerned about making your payments on an OneMain loan, you can visit your branch or speak with a loan specialist over the phone to discuss your options.

2. Make a payment

Making the missed payment before it's reported to credit bureaus is the surest way of avoiding impact on your credit score. Even if the missed payment was already reported to the credit bureaus, make the payment as soon as you can to minimize negative effects on your credit score.

3. Ask for help

If you’re struggling to manage your debt payments and you’re not sure what to do, consider reaching out to a nonprofit credit counselor for support. A credit counselor may help you develop a plan for tackling your debt and making your payments more manageable.

Ways to avoid late payments in the future

Once you’ve addressed a late payment and gotten back on track, you may want to work on strategies for staying on top of your debt payments. You can take steps now to help avoid late payments going forward.

Revisit your budget

Review your monthly budget to determine whether any changes in your spending may help you more easily cover your bills. If you haven’t already incorporated your monthly debt payments into your budget, add them and try to adjust accordingly, if possible. Remember, it’s a good idea to revisit your budget periodically and adjust it as needed — as your finances change, your budget may need to change with it.

Explore debt consolidation

If you’re missing payments because you’re dealing with multiple debts, you might want to explore debt consolidation options. Debt consolidation helps you turn multiple bills into a single monthly payment, simplifying your debt repayments, and it can be a helpful tool for managing and paying down debt. Options for debt consolidation include a debt consolidation loan or a credit card with a low promotional annual percentage rate (APR) on balance transfers.

With a OneMain debt consolidation loan, you may be able to lower your interest rate or get a longer term to pay down debt, which may lead to lower monthly payments. Note that with a longer term, you may pay more interest over the life of the loan, even if your monthly payments are more manageable.

Set up autopay

If you’ve missed payments because the due dates slipped your mind, you may want to consider setting up automatic payments with your lender. Automatic payments pull money from your designated bank account when it’s time to pay your bill. Just be sure to keep enough money in your account to cover your recurring bills. When getting started with autopay, it’s a good idea to set a calendar reminder for a few days before your due date so you can double-check you have the funds to cover what you owe.

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Move forward from a missed payment

Missing a loan or credit card payment may seem like a major setback at the moment. But a missed payment doesn’t have to define your financial future. By acting quickly, you may minimize the negative effects a late payment may have on your credit score. And even if you have a history of late or missed payments, it’s never too late to start practicing positive credit habits.

Sources:

1. https://www.experian.com/blogs/ask-experian/the-difference-between-vantage-scores-and-fico-scores/.
2. https://www.nerdwallet.com/article/finance/late-bill-payment-reported.
3. https://www.experian.com/blogs/ask-experian/when-does-debt-become-delinquent/

This article has been updated previous postings in 2019 and 2022. Matt Diehl and Andrea Hoyt contributed.