381Payments Affect Your FICO Score
posted on February 1st, 2009
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Your credit markshould be really important to you as it determines how much you can borrow, and what type of interest rate you will get. Approximately 35% of your credit score is made up of your payment history. If you dont make your payments on time your mark will be affected in a negative manner. One late payment, more than 30 days late, can drastically lower your FICO mark which means the following loan you get will be at a increased interest rate and in the end could cost you numerous thousands of dollars.
You run the risk of your account going into collections if you are extremely late and receive numerous ninety day or more past due payments. Collections appear on your credit report and lower your FICO mark quite a bit.
If you cant remit all of your bill, for whatever reason, there is an option open to you. It is minimum payments and it can save you from lowering your credit score, even though you still owe money. Minimal payments can be applied to pay the interest on your credit report. That being told, don’t bank just on minimum payments, or else you will just remain to fall further and further behind on your accounts.