Does a late payment for your credit card affect your credit standing and history?

Answer 1

Of couse it does.

If you are consistant about making payments and miss one or two, but contact the company and explain why, there is usually no damage to your credit rating or history. However, if you keep missing payments and do not make the minimum payment and do not give an excuse to the company then yes, your credit history will haunt you.

In Canada, if you are really down and out and have little money, as long as you put a few dollars down on each bill, then the company you owe the money to can't send a collection agency after you. You must prove however, that you have either lost your job, just started a new job, don't own an expensive car or home.

Everyone can get into a problem with their credit card, but just being honest with the company will take the stress off of you until you can pay on time.

Your credit file is a reflection of how you have paid accounts. A credit score is a numerical calculation of your perceived risk as a borrower. Scores are performed by an extremely complex computer program. While no one can tell you specifics, what is known is:

35% of the score is calculated based on payment history. The emphasis is on what has taken place in the last 12 months. Even one late payment can drop a credit score 50-250 points.

It is always a good idea to write (don't call) a creditor when you have one late, to see if they will change their reporting as a gesture of "goodwill" because of your "many years of great payment history" or "outstanding business relationship". But many creditors refuse to comply. Having even one late payment can mar you credit for 7 years from the time you were late. This is why paying all accounts on time is the #1 strategy to improving your credit score.