Missing Credit Payments And Your Financial Health

Sometimes things just come up. You have an unexpected expense, or just flat
out forget. Many people think this is no big deal, forgetting to make a
credit card payment won't hurt you in the long run, as long as you make your
payment the next month right? Well actually, missing a credit card payment
can actually ruin your financial health. There are three main things that
can happen when you miss a credit card payment.
Each card is different and some are more or less strict, but this is just an
overview of what could happen.

Bye Bye Promo

So you get a new credit card with a great promotional rate like 2% for the
first year on all your purchases. So things are going along well, you rack
up some charges and then one month something comes up. You can't afford to
pay all of your bills, so you figure you will just skip your credit card
this time.
Well, in most cases, if you do this, you can say good bye to your
promotional rate. This rate is a reward for staying a responsible customer,
and if you don't stay responsible you can forget about keeping it.

Default Rate

Even worse, if you don't make a credit card payment, the company will often
change your rate back to the default interest rate which is normally quite
high. So if you think that you are having trouble affording your minimum
balance when your rate is at a promotional rate of 2%, try affording it when
it is at a rate of 20%.

Credit Score

Most credit companies will report you to the credit bureau for just one late
payment. This can lower your credit score by several points and can cause
you to be turned down for credit in the future. It seems like a lot for just
one late payment and it is, but it is not worth it to risk it all for one
payment. It is best to pay the minimum, even if you have to move money
around a little and may not be able to do something extra like go to a movie
or out to eat. But in the long run it will be worth it.

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