Is there a difference between a late payment and a default?

jonathanc

I just logged into one of my credit card accounts and was really upset to see a late payment charge of £12 for a payment that should have been made by December 16th.

This is the first time in 7 years of having credit cards that this has ever happened to me! The reason it happened is because the e-statement reminder went into my junk mail folder and I therefore didn't notice it :-(

Does anyone know whether there's a difference between a 'late payment' and an actual default - and how those differences would translate into affecting my credit score.

mo786uk

If you have bee officially defaulted they will send you a formal notice - if you pay the amoutn required they may not necessarily default you.

this page indicates you are not defaulted unless you have missed multipe payments

http://www.my-iva-adviser.co.uk/iva-what-is-a-default-notice

jonathanc

I paid the full balance straight away via Faster Payment, so I'm glad that this won't be considered a default. Thanks for the info.

Will this missed payments also get reported to the credit reference agencies, and if so, would it have an adverse affect on my credit rating?

Bravehearted_2

Yes - it'll be reported.

May or may not affect you adversely; different lenders have different tolerance for one late payment.

hunsbury0

I would set up a direct debit mandate to pay monthly amount in full when due, to avoid missing it for any reasons.

McKneff

If its the first time it's happened and you ring up and be nice to them, they may just refund you.

But it would be wise to pay it by Direct Debit in future, just for peace of mind.

oscar52

Bravehearted wrote: »

Yes - it'll be reported.

May or may not affect you adversely; different lenders have different tolerance for one late payment.

While I agree that it will be reported, I very much doubt it will have any adverse affect.

One late payment in seven years, or six years so far as credit files are an issue, would hardly been seen as cause for concern.

However, if another late payment were to occur with in the next couple of months, then this late payment would be taken into consideration by other lenders if you were going for further/additional credit.

izools

oscar52 wrote: »

While I agree that it will be reported, I very much doubt it will have any adverse affect.

One late payment in seven years, or six years so far as credit files are an issue, would hardly been seen as cause for concern.

However, if another late payment were to occur with in the next couple of months, then this late payment would be taken into consideration by other lenders if you were going for further/additional credit.

Absolutely right, well, right for the most part.

The late payment is likely to have a slight negative effect for six months, although only slight, so long as it is one missed payment all by itself in the applicant's payment history.

[Deleted User]

Most credit card providers do not report the default until they have sent you the "default notice". Late payments are not usualy reported until 2 or 3. I should know :-(

jonathanc

Thanks for all your advice guys.

I wrote an email to them yesterday explaining to them the adverse circumstances. Based on my historical payment history, they were happy to refund the £12 fee and they assured me that my credit rating won't be affected.

Very happy now!

reclusive46

jonathanc wrote: »

Thanks for all your advice guys.

I wrote an email to them yesterday explaining to them the adverse circumstances. Based on my historical payment history, they were happy to refund the £12 fee and they assured me that my credit rating won't be affected.

Very happy now!

Which company was this? Virgin money did the same for me last time.