What Happens If You Miss a Credit Payment? Here’s What to Expect and What to Do

If you’ve missed a payment on your credit card, loan, or overdraft, you might feel anxious or even a little ashamed. Maybe life got hectic, money was tight, or something simply slipped your mind. If this is you, take a breath. You are not alone. Many people in the UK miss a payment at some point. The most important thing now is what you do next.

Let’s talk about what happens step by step, what it means for your money, and most importantly, how you can get back on track.

When Does a Payment Count as Missed?

A missed credit payment happens the moment you don’t pay at least the minimum amount by your agreed due date. It doesn’t matter if you pay by direct debit, standing order, or transfer. There’s no “grace period” with most UK credit cards or overdrafts. Even being one day late means it counts as missed.

As soon as that due date passes, the process starts:

• Fees and extra interest may be added.
• Your lender records it in their system.
• It’s eventually reported to the credit agencies.

So, even if you meant to pay and just forgot, or your payment bounced, it’s still counted as missed.

What Happens Right Away? Late Fees, More Interest, and Warnings

Missing a payment can feel like a small slip. But it quickly gets expensive. Here’s what usually happens next:

• Late Fees: Most UK credit cards charge between £12 and £25 straight away. If your direct debit bounces, your bank may add a returned payment fee too (often £25–£35).
• Notice from Your Lender: You’ll get a message—text, email, or post—telling you the payment was missed and what to do next.
• Legal Notice (Default Notice): If you’re still behind after about 30 days, you’ll get a formal letter under the Consumer Credit Act. This is not just a reminder; it’s a legal warning.

The Financial Conduct Authority (FCA) caps the fees, but even so, missing payments can quickly cost you money you didn’t expect to lose.

TIP: I have seen that calling your lender as soon as you know you’ll be late can sometimes stop extra fees from being charged, especially if it’s your first time missing a payment. It’s always worth asking.

What Happens to Your Account After a Missed Payment?

Missing a payment doesn’t just cost you fees. Here’s what else can happen:

• Interest Charges Increase: You’ll be charged interest on your outstanding balance. If you had a special 0% deal, it’s usually cancelled. The standard rate, often 29.9% or higher, will now apply, sometimes backdated to when the deal started.
• Penalty Rates: Many lenders will apply an even higher “penalty APR” if you miss a payment, making your borrowing even more expensive.
• Account Changes: Your credit limit might be reduced. Your card could be frozen. You may lose interest-free periods for future spending.

Everything gets more expensive and more stressful, quickly.

When Does a Missed Payment Show Up on Your Credit Report?

Lenders report missed payments to the UK’s three main Credit Reference Agencies (Experian, Equifax, TransUnion). This usually happens once you’re more than 30 days late.

On your credit file, a “1” will appear in the arrears column for each month you are behind. For example:

• “1” means 1 month late
• “2” means 2 months late
• And so on

If you go 90 days without paying, most lenders record a “default.” This is a serious negative mark. New lenders will see it when you apply for credit, and it can make it very hard to get loans, mortgages, or even a mobile contract.

How Does a Missed Payment Affect Your Credit Score?

Your payment history is the most important part of your credit score. Even one missed payment can drop your score by 25–100 points. How much your score drops depends on your current rating and how recent the missed payment is.

Here’s what you need to know:

• The mark stays on your report for six years from the date of the missed payment—even if you pay it off later.
• The impact lessens over time, but new missed payments add up and make it harder to recover.
• Future lenders see these marks and may decide you’re a higher risk.

This can affect:

• New credit card applications
• Loans for cars or homes
• Rental agreements
• Sometimes, even job applications

But this is not the end of the road. You can recover. The key is what you do next.

What If You Miss More Than One Payment? Here’s What Happens

Missing one payment is a problem. Missing several is much more serious.

Here’s the typical timeline if you keep missing payments:

• One Missed Payment: Late fees, interest, credit report mark.
• 30–60 Days: More fees, higher interest, more pressure from your lender.
• 90 Days: Most lenders will “default” the account and close it. This is a big red flag on your credit file.
• After Default: The debt may be sold to a collection agency. You’ll start getting calls and letters from debt collectors. They may add extra charges.
• Charge-off: If no payment is made for months, the lender will “charge off” the debt. They write it off as a loss, but you still owe the money.

A charge-off or default is one of the most damaging things that can happen to your credit record.

Legal Consequences: What Happens If You Still Don’t Pay?

If you still don’t pay after all these steps, legal action is possible. Here’s what can happen:

• County Court Judgments (CCJs) in England and Wales, or decrees in Scotland: The lender takes you to court and gets a judgment ordering you to pay.
• Bailiff Action or Asset Seizure: If you ignore the court order, bailiffs can be sent to collect payment or seize belongings.
• Wage Garnishment: In some cases, the court can order payments directly from your wages.

These court marks stay on your credit file for six years and make future borrowing very difficult. But remember, there is help at every stage. It’s never too late to ask for support or advice.

Your First Steps to Minimise Damage If You Missed a Payment

Missed a payment? Here’s what to do now:

1. Pay as soon as you can.
   Catching up quickly can turn a serious problem into a minor setback. One late payment is better than a string of them.
2. Contact your lender right away.
   Don’t hide from your lender. Ask to speak to their “hardship” or “support” team. They may offer:
   • A one-off payment holiday
   • A payment plan
   • Waiving some fees
3. Ask for a fee waiver if this is your first time.
   If you’ve always paid on time before, lenders sometimes remove the fee as a gesture of goodwill. It never hurts to ask.
4. Dispute any mistakes.
   If you did pay but your account was marked as late, gather your bank statements or payment confirmations and dispute it. Lenders are required to fix errors within 28 days.
5. Get free debt advice.
   There are many free, confidential services in the UK (like StepChange or Citizens Advice) that can help you understand your options.

TIP: I always tell borrowers to write down the date and time of every call with your lender, and keep copies of all letters or emails. This makes it much easier if you need to dispute a fee or negotiate a payment plan later.

How to Rebuild Your Credit After a Missed Payment

You can recover from a missed payment. Here’s how:

• Make all future payments on time.
  Set up a direct debit for at least the minimum due, plus extra if you can afford it.
• Keep your balances low.
  Try to use less than 30% of your available credit on each card or account.
• Don’t apply for new credit unless you need to.
  Every new application adds a “hard search” to your report, which can lower your score temporarily.
• Check your credit report regularly.
  Look for errors and fix them right away.

Building your credit again takes time. But every on-time payment moves you forward.

How to Avoid Missing Payments in the Future

Preventing missed payments is easier than dealing with the aftermath. Here are practical steps you can take:

• Set up automatic payments.
  Arrange for at least the minimum payment to come out automatically. Then, set up a separate standing order for any extra you can afford.
• Use calendar reminders.
  Set an alert on your phone or in your diary to check due dates each week.
• Review your credit agreements.
  Know what fees, charges, and rules apply to your accounts.
• Contact your lender early if you’re struggling.
  The sooner you ask for help, the more options you’ll have. Many lenders can pause payments, freeze interest, or agree to new terms if you let them know before you miss a payment.
• Build an emergency fund, even if it’s a small one.
  Having even a few hundred pounds set aside can help you cover a payment if money gets tight.

TIP: I have found that starting with just £5 or £10 a week in a separate savings pot is a simple way to build an emergency fund, and it really helps when something unexpected comes up.

Bringing All This Together: How You Can Take Control Again

Missing a credit payment feels stressful, but it does not define you or your future. The consequences are real: fees, higher interest, a drop in your credit score, and the risk of further debt problems. But every single one of these problems can be addressed, starting today.

What to do now:

• Act quickly: Pay as soon as you can.
• Talk to your lender: Ask for help, not just time.
• Take steps to prevent another miss: Set up direct debits and reminders, check your statements, and know your options.

And if things feel overwhelming? Reach out for free help. There is always support available, and you are never alone in facing money troubles.

Every positive action you take, however small, builds your financial future. The road to recovery starts with one step. You can do this.

Questions People Ask About Missed Payments

What if I’m just a few days late?

Even being one day late means you’ll be charged a late fee. If you catch up before your next statement, some lenders might not report it to the credit agencies. Always ask if they can help.

Will one missed payment ruin my credit forever?

No. One missed payment is a setback, not a disaster. The effect on your score will fade over time if you make all future payments on time.

Can I ask for a late fee to be cancelled?

Yes. Especially if this is your first time or there’s a good reason, call your lender and ask. Be polite, explain your situation, and ask for a “goodwill waiver.”

How long will a missed payment stay on my record?

Six years. But its impact on your credit score lessens over time, especially if it’s an isolated incident.

What if my lender wrongly marked me as late?

Gather proof (bank statements, confirmation emails) and dispute it with your lender. They have 28 days to correct genuine mistakes.