Missing a credit card payment can happen to anyone. You forget, get busy, or just don’t have enough money that month because of an unexpected cost. Even though things may look bad, there are things you can do to get back on track. You can lessen the long-term effects of this by acting quickly and talking to your credit card company.
Don’t Panic, But Act Fast
First and foremost, don’t ignore the situation. Missed payments will not simply go away on their own. The sooner you address things, the more options you’ll have.
If you think you might not be able to pay on time, call your credit card company right away. Feel free to tell them about your problem and ask if they can help. A lot of credit card companies have programs and other resources they can give to customers who are having trouble with their finances.
Review Your Budget
Take a close look at your income and expenses While paying the full balance is ideal, paying even the minimum monthly amount can help avoid late fees and penalties The minimum is usually around 1-3% of your total balance.
Look for areas where you can temporarily cut back, like dining out, entertainment or subscription services. If your next paycheck or freelance gig is coming up soon, see if you can stretch current funds until then. Consider picking up a side job or selling unused items to come up with cash quickly.
Change Your Due Date
Since billing cycles vary, you may be able to adjust your due date to better align with your pay schedule. Contact your issuer to see if they’ll allow a one-time or permanent change. Just keep making payments in the interim.
Request a Lower Interest Rate
Given that interest charges increase your overall balance, getting a lower APR could make your monthly payments more affordable. Call and politely ask if they can reduce your rate. Be sure to emphasize that you intend to keep making on-time payments.
Look Into Hardship Programs
Issuers understand that unexpected circumstances happen. They often have hardship programs that can assist customers for a certain time frame, such as reducing or waiving fees, lowering interest rates, or creating a customized repayment plan Check if you qualify
Use a Balance Transfer Card
Balance transfer cards allow you to pay off debt on one card by transferring the balance to a new card. You’ll typically pay a 3-5% fee but then have a 0% promotional APR for 12-21 months. This gives you time to pay it off without accruing more interest. Your credit should be in decent shape to qualify.
Lean on 0% APR Cards
Similarly, cards with a 0% intro APR can be used for new purchases without interest for 6-18 months depending on the card. Charge emergency expenses to the card and pay it off before regular rates kick in. Just be sure to make payments during the 0% term.
Consolidate Debt
Debt consolidation combines multiple balances into one new loan with a lower interest rate. This simplifies payments and can reduce the total interest paid over time. Personal loans or balance transfer cards are common tools. Compare lenders to find the best terms.
Ask for Credit Limit Increases
Having a higher limit means your utilization ratio (the percentage of your limit you actually use) will be lower. This can improve your credit score over time. Request an increase every 6-12 months if you consistently make on-time payments. Even $500 can make a difference.
Enroll in Credit Counseling
Non-profit credit counseling agencies can help you evaluate your whole financial situation, make a budget, negotiate with creditors, and advise on managing debt. Make sure to vet any organization thoroughly first and understand all fees.
Explore Debt Settlement
With debt settlement, a company negotiates directly with your creditors to settle accounts for less than you owe. This does impact your credit badly and taxes may be owed on the forgiven debt. It’s best for those with very poor credit and few assets at risk.
Understand the Consequences
Don’t let fear of consequences prevent you from taking action. But do understand potential outcomes of missed payments:
- Late fees, usually around $30-40
- Higher interest rates
- Lower credit scores
- Penalty rates above 20% APR
- More aggressive collection efforts
- Legal judgments
- Wage garnishment
Keep Communicating
The biggest takeaway is to communicate with your credit card company early and often. They want to get paid, so they will likely work with customers who keep them informed and demonstrate good faith efforts. Don’t avoid their calls or ignore the problem. You have options, even if funds are low.
Set Up Payment Reminders
To avoid future headaches, set up automated payments or payment reminders with your issuer. You can do calendar alerts on your phone or ask your credit card company about email reminders. Automated payments deduct the minimum or full amount from your checking account each month.
Monitor Your Credit
Keep an eye on your credit by using a free service like CreditWise. It can alert you to meaningful changes in your TransUnion and Experian credit reports. This lets you stay aware of any impacts from missed payments. Monitoring services do not hurt your credit.
Being unable to pay your credit card bill can happen without warning. Acting quickly, communicating openly, and utilizing available tools and resources can help minimize the fallout. Don’t be discouraged—with some planning and diligence, you can get back on track.
Call Your Card Issuer
You might feel embarrassed, but try not to be—calling your card issuer is another important option at your disposal. If you have a history of making payments on time and expect your personal situation to improve soon, it might be enough to call up and ask for a one-time late fee waiver. For small, one-time requests, many customer service representatives are empowered to help.
On the other hand, if you expect ongoing challenges, you might need to ask about joining a potential hardship program instead. With a credit card hardship program, you’ll work with the card issuer to lower your interest rate or waive fees on an ongoing basis until you get back on your feet. That can help you out tremendously, but not without trade-offs. In exchange for the assistance, they may reduce your credit limit or freeze your account from new charges entirely.
Another potential source of help is requesting to change your due date on future billing cycles. Some card issuers will let you select your preferred due date online while others require a quick call. This probably won’t help you for this particular billing cycle but can set you up for success going forward. For example, if you normally get paid on the 15th of every month, you may prefer a due date on the 16th or 17th instead of the 14th.
Make a Payment As Soon As Possible
Making a payment after the due date won’t help you avoid late fees but it still helps. Every dollar you pay reduces your interest charges. If you can pay more than the minimum payment, it will have an even bigger impact: As required by law, payments are always applied to balances at the highest interest rate first, such as those associated with a penalty APR. It also matters because many cards compound interest daily.
Making payments of any size also helps keep you out of full credit card delinquency and can keep negotiations with your card issuer on the table.
What should I do if I can’t pay my credit cards?
FAQ
What happens if I am unable to pay my credit card bill?
How to clear credit card debt without paying?
Will credit card companies forgive debt?
Does credit card hardship hurt your credit?
What happens if I don’t pay my credit card bill?
Failing to do so can result in late fees, potential damage to your credit score and even having your account closed and turned over to collections. In other words, if you don’t have the cash to cover your credit card bill, the solution is not to simply skip your payment and hope for the best. Try these steps. 1. Get creative
What if I miss a credit card payment?
If you have some money to spare but not enough to cover the minimum, offer to make a reduced payment. This might be enough to avoid getting your missed payment reported to the credit bureaus.
What if I can’t pay my credit card payment?
Juggling a budget in order to pay bills can be stressful. There may be concerns about missing payment deadlines and being able to pay everything when it’s due. If you can’t make your minimum monthly credit card payment, it can help to contact your lender first. But what else might happen? Learn more and see what options might be available.
What should I do if I don’t pay my credit card bill?
Call your credit card issuer. It’s important to keep the lines of communication open with your credit card company when you’re having trouble paying your bill. Especially if your situation is temporary, informing your issuer of a late or missing payment could lead them to hold or waive fees if you’re otherwise in good standing.