So a really stupid thing happened, and I acknowledge I should have been more on the ball to prevent it. That said, here’s the scoop.
I remembered setting up a monthly scheduled payment to automatically take the money out of my checking account to pay on my credit card so I wouldn’t have to worry about it. Foolishly, after setting up this payment, I didn’t bother to check my balance as I trusted it was taken care of. WRONG.
I check my credit report every month, and got a notice that a negative item had been posted. The aforementioned credit card was apparently past due, saying I had not made a payment since August. This floored me. Like I said, I thought those payments were being made. Anyhow, the negative item dropped my score by 75 points. Luckily it was Excellent, so now it’s just down to Fair instead of poor, but it still smarts. I made the payment that was due and then some, so now I am current. It was never about not being able to pay. I must have incorrectly gone through the procedure to set up my bill payment, and the money just never got drafted. Ironically, I haven’t used that card in months.
My question is this: Now that I’m current (and I actually intend to pay off the rest of the balance with my bonus check from work next week), can I expect to see any increase in my score at the next reporting period? I understand the report of my delinquent account will stay on my record for a few years. What I’m wondering is if my score can possibly recover.
And in case any of you are wondering, yes, this has taught me a valuable lesson about checking on my accounts to make sure those payments are being made!
I’ve already contacted the credit card company. The fact that, in my five year of being a customer, this is the first time I’ve had a delinquent report does not matter to them. They also will not modify thir report to the credit bureau because the “mistake was not on [their] part.” Therefore, the information will stand.
You now have discovered the problem with automatic drafts. Never, never, ever set automatic payments. Always have control over your money. It is your responsibility to make your payments in a timely manner. Now you have dinged your credit, it could take up to a years to raise your score.
A negative item stays on your account for 7 years.
Good luck in the future.
Under normal conditions you do not have much choice. This “late payment” will remain on your report for seven years from the month in which the late payment was due (see source).
However, if you can prove it was caused by negligence on behalf of the bank not processing you payment properly and not by you, then you could demand that the derogatory item be removed. You should contact both the credit card company and the bank to see what caused this.
If the bank could not make payment for that period of time due to your account having insufficient funds, then you are out of luck.
Hope this helps answer your question.
If you have historically been a good customer with the credit card company you may be able to call and explain what happened. They have the power to remove these negative marks and may do so if you ask politely. Good luck.
As soon as you pay up your outstanding balance on your credit card your account will say “paid as agreed”, it won’t bring your score up in just one payment period. Sad to say it can take 6-12 months sometimes even more to do that. As long as you have the account, it will be on your credit report and will show under # of times late….30 days 2 times, 60 days …1 time…etc… or whatever your case is. That will stay there for the duration of the accounts existence.
A credit score changes about every 12 months or it can go up 5% to 10% per month as long as you are paying on time. After 24 months of new activity, your credit score should get back to where it was before. I would also suggest that you open a new checking account and never sign up for auto pay. I do have my checking account and credit card with the same bank but I pay them online not by auto-pay. I just hope I won’t regret it later.