What defines a late payment on a credit card?

What defines a late payment on a credit card?

Is There A Grace Period?

There is and it depends on your credit card company.

The period can be from 3 days up to as long as 14 days before it is noted as late on your credit file. Late payments or repayment information can be reported and noted on your credit file for up to two years.

Credit card late payments mean that you are failing to pay your payments by the due date and even after the grace period.

A payment default is usually issued or declared when you are 60 days or more overdue.

A payment default can be added to your credit file if you have missed a payment that is 60 days overdue and an amount of $150.00 or more.

Credit card providers will report your late payment information to the main credit bureaus. In Australia these are Equifax, Illion and Experion.

When a default is listed on your credit file it will usually remain on your credit file for 5 years even if you have paid it.

You can sometimes negotiate to have a default removed as part of a settlement or if the information is incorrect or entered in area.

At the same time, a credit default can have serious implications on your ability to borrow money in the future.

Slow payments and defaults.

If you fail to pay your credit cards and other loans on time, this will have a negative impact your credit file and your credit score.

Your repayment and default history make up an important part of your credit file/report and credit score.

Slow payments and defaults will result in a reduced credit score and this will affect, not only your chance of getting a loan but your interest rate and other terms as you will be viewed as a high-risk client.

Another downside of slow payments is that some lenders will charge default interest rates that are higher than your current loan rates.

Check your credit file and credit score for free at www.freecreditreort.com.au.