What to do if you missed your payment
Have You Just Missed Your Payment?
Late payment is not a good item to have on your credit report. It does not only have damaging effect on your credit, it may make lenders to decline your future loan applications. Another problem with late payment is that it can stay on your credit report up to seven years before it falls off. Recent late payment will affect your credit more but over time, the effect will continue to diminish especially if you make your payments promptly thereafter. However, if you just missed your payment, there are certain steps you can still take in order to protect your credit.
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How You Can Resolve Missed Payment
Call your creditor: The first thing you should do is to call your lender and explain your situations to him. Missing a payment does not really mean that it will be reported as late payment. Before a missed payment can be reported as late payment, it must have been 30 days past the due date. So, you actually have ample time to get across to your lender. It is possible that you missed the payment as a result of the situation that is totally out of your control. If you were ill and had to be hospitalized, you may not be able to meet your payment deadline. Your lender is a human being too. Even if you will not be able to make the payment within the 30 days period, your lender may choose not to report your late payment to the credit bureaus. This is easier than pleading for the removal of the late payment from your credit report after the deed has been done already. Therefore, you should not delay the call. It will even make your creditor to see you as somebody who is responsible.
Make the payment or negotiate: Having realized that you have missed your payment, you should not hesitate to make the payment immediately if you have the money. If the money is not readily available, you can negotiate for a better or more convenient option. For instance, you may suggest that you will pay for two months in the next month. This arrangement may only work if you have established a good credit standing with your creditor over time. Also, you should be able to convince him that you will not miss the payment. If necessary, you may show him the proof of the income you are expecting which will make it possible for you to make the payment. Peradventure your missed payment has slipped into late payment and it has already been reported to the credit bureaus, you can still ask your creditor to help you remove it from your credit report. Except it is removed, it will stay in your credit report for seven years. Note that your creditor does not have any obligation to remove the late payment from your credit report. He will be doing you a great favour if he does. Therefore, you should learn how to make the request in a very polite manner. You can even suggest paying off the entire loan including any penalty and late fees if you have the money. This may motivate him to grant your request. The truth is that, whatever sacrifice you may need to make in order to get rid of the late payment from your credit report will worth it in a long run.
Read Also: Effects of Late Payment on Credit Score
Set automatic payment: If you have not finished paying your loan or credit balance, you can set automatic payment so that the payment will be deducted directly from your account every month. This will resolve the issue of missed payment. But you need to ensure that you always have sufficient fund in the account at all times. Otherwise, the payment will be declined. This can even make the situation to be worse. To be on the safer side, you can set payment reminders instead of setting up automatic payment. This will keep reminding you of the need for you to pay when your payment is due. If you are paying for credit card balance, you may need to contact your card issuer to advise you about your billing cycle. Your billing cycle may not necessarily the end of the month.