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Have you ever stressed out because you made a late payment on a loan or a credit card? You’d be surprised at how many people who are just a few days late on their payment, become instantly worried that their tardiness will directly affect their credit report making it nearly impossible to get extended credit in the future. I can promise you that after you read this article you will have a much better understanding of how credit reporting really works for late payments. You need to be aware of certain time lines to truly understand their effects and why or why not you should worrying.

While certain late payments DO negatively affect your credit, a late payment of 10 days or less will generally be penalty free. The majority of financial institutions have at least a 10 day grace period where a late payment will not be assessed any fee. Once you get beyond the 10 day grace period your account will normally be dinged some sort of fee, however this tardy payment is still not reported to the credit agencies. Once your account becomes 30 days in arrears, it then becomes reported to the credit agencies and shows up on your credit report.

If you are only 30 days late one time, your credit report reflects this as a one time late payment. The arrears time line is reflected in the following order:

- 30 days late

- 60 days late

- 90 days late

As the timeline shows, payments are reported late on an every 30 day basis. While this is generally the rule, it is always best to consult your specific credit card company or the bank that handles your loan so you are fully aware of their particular policies. As you can see, worrying over a few day late payments is not worth your energy.

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