No, generally late payments will not show up on your credit report unless you have defaulted for more than 30 days. But, you may have to incur the late payment fee even if you miss the payment due date by 1 day.
Let’s take a look at how the payment cycle generally works –
Payment cycle of a credit card
- Your statement or bill is generated on the account closing day.
- The payment due date is the date by which you have to clear your dues or outstanding. The payment due date is usually mentioned in the statement or bill.
- The payment due date is usually the same, like the 15th or the 20th of every month. It is a good practice to set a reminder for paying your bills.
- The lender may charge a late payment fee after the payment due date has passed.
- Then, is the reporting date. The reporting date is when your account history is reported to the credit bureaus.
It is extremely important that you clear your dues by the payment due date. Late payments can affect your credit score and hence your chances of getting loans in the future.
Credit period allowed by lenders
Generally, all lenders would allow a credit period of up to 30-45 days. This means that you can make your payments every 30-45 days (on or before the payment due date) and clear your dues. Some lenders allow a 60-day credit period too and do not report anything until then.
It is best to pay your outstanding on time to maintain good financial discipline and credit worthiness. However, if you are late by a few days because of any reason, it should not be affecting your credit score immediately.