If you are having a hard time meeting your credit card payment deadlines, you should consider changing the due date. There are lots of companies that will allow you to make this change fast and easy. However, not all of the companies will be flexible with their credit card payments. If you’re with a company that doesn’t allow you to change the due date, consider getting money from your emergency funds. Before you consider changing the deadline, there are lots of different ways to make your payments on time.
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Pros to Changing your Payment Deadline
When you decide to change your credit card payment deadline there are a few perks that comes with doing so. When you put most of your transactions on your credit card to gain as many rewards as possible sounds like a good idea. However, it can result in you having a big bill to pay off when the month is over. Typically, it would be better if you align the deadline with when you get your paychecks. Keep in mind, it’s very important to pay your credit card bill on time so it does no damage to your credit score. There’s about 35% of your credit score that will be determined by your history of making your payments on time.
For the people that normally pay their credit card balance completely each month, they think they don’t have to worry about the credit utilization ratio. However, the issuer doesn’t normally wait until after you paid your bill off to send your information towards the credit bureaus. You can change your billing date so it can be before they send your information to the major credit bureaus. Basically, you’ll be able to make your utilization seem low each month. Remember, you should always try to have your balance under 30% of your available credit. You may even increase your credit score a little when you do this.
Compared to other bills, you won’t have to pay your credit card bill in full. However, if you want to stay away from interest charges, you should pay your bill completely. In other words, it will make doing a partial payment on your card reduced since you have more money to use.
How Late Payments Damage Your Credit Score
If you find yourself being 30-60 days late on your payments every now and then, it shouldn’t affect your credit score unless it was recent in the past 2 years. But, if you’re around 90-120+ days late on your payment, the credit score models will consider that you’ll do it again. Getting even one 90-day late payment will harm your credit for about 7 years. With the score models in mind, one 90-day late payment damaging your score is seen as bankruptcy filing, tax lien, collection, judgement, or repossession.
There are 2 types of collections that come from having a late payment. What’s been sold to a third-party collection agency or collections that’s been turned over to internal collection department. Whichever one appears on your credit statement, it will hurt your score.
Charge-offs are when you don’t make your payments for the credit amount for about 120+ days. The credit issuer can have the account marked as a charge-off which will be written off your debit as a “loss.” Having this on your account will appear “negative” on your credit statement since the creditor doesn’t expect to get the money back. However, even if they don’t expect the money back, the debt won’t go away. The creditor or third-party collector they sold the debt to can try to get the debt for as long as the state’s statute of limitations lets them.
A repossession is for having a home foreclosed or a car repossessed. It will be seen as major factors that decrease your credit score. Normally, people will think just cause they gave the home or car back to the lender it shouldn’t appear as delinquent. It doesn’t work since the contract has been signed agreeing to buy the home or car and pay it in full over a time period. Since the person returns it, they will consider you to be in default of the contract and appear on the credit statements.
How to Change Your Payment Deadline
There will be some companies that will allow you to change the due date of your payment. However, every company has different rules to follow when doing so. One of them is that your account has to be in good standing. Additionally, you won’t be able to change your deadline more than once every 90 days or in the month you’ve opened your account. If you’re unable to get a hold of your company, visit their website or call customer service to change the deadline. Once the bank has accepted your request, you’ll receive your new bill on the new due date. Even if you request for a new billing cycle, it will not always be guaranteed.
Remember, if you change your payment due date, it can come with additional interest fees for balances you carry over. This is from the change in the days of your new billing due date. However, it will only happen one time, your billing cycle will go back to normal afterwards. When you change your billing cycle, you can increase the chances of having a better payment history. However, it doesn’t always work out that way. If your card issuer cooperates with you, the new date you want might not be available. Lots of card companies will not allow you to change the date to the 29th, 30th, or 31st. This is because not every month will have the same number of days in them.
Conclusion
Overall, when you change your payment deadline there are many things to consider before doing so. Most of the time, it will help you out when you’re behind on the billing cycle. When you change the due date, you’ll be able to increase your credit score and save money. However, when you apply for a change, it won’t always be guaranteed. Not to mention, there are other factors you need to look into to see how it will affect your credit statement.
If you’re having trouble keeping up with your current bill cycle, then it will be a good idea to move it to a different date. Keep in mind, there are some companies that will charge you additional fees for doing that.
