It’s never a good idea to miss a car payment. You should always make your car payment and other bills on time each month to maintain a good credit score. Even if you do miss a payment, if you catch it early enough, you can decrease the impact it’ll have on your credit score.

When is a Car Payment Considered Late?

How Much Does a Late Car Payment Affect Your Credit?Once you miss the due date on your payment, it’s officially considered late. Following the missed payment, the creditor can assess a late fee. The good news is you can recover from a missed payment fairly quickly – as long as you make the payment before the next one is due, plus the late fee the following month. According to the Credit Reporting Resource Guide, your creditor can’t report any late car payments until it hits 30 days past due. If they do, it’s breaking the law.

You could think of the late fee as a “grace period” before it begins to hurt your credit score. But you shouldn’t take the situation lightly or get into the habit of missing multiple payments. It’s easy to lose track of time and money, and more missed payments will cause bigger hits to your credit score.

How to Prevent Late Car Payments

So, how do you make sure you never miss a car payment? There are many different strategies you can use that’ll not only help you keep up with your car payment, but other monthly bills as well. Some tips are to:

  • Choose your payment dates – If you’re able to choose a specific date to pay each month, it’s easier to remember one or two dates your bills are due.
  • Set up reminders – Whether on your personal calendar or phone, setting up payment reminders are a great way to keep you on track.. You may even be able to set up automatic bill pay online in some cases.
  • Discuss payments with your lender – If you know you won’t be able to make the next month’s payment, talk to your lender. Your lender will appreciate you discussing your financial situation and asking for help. In some cases, they may allow you to skip a payment and add it to the end of the loan term.

The Bottom Line

Keeping up with your car payments will help you improve your credit score over time. If you’ve been thinking about taking out a car loan to help improve your credit, Auto Credit Express wants to help.

We connect car buyers to dealerships in their area that specialize in helping people with imperfect credit get into new and used car loans. Our service is free of cost and obligation. Start with confidence by submitting our auto loan request form today.