Why it is important to post your credit card bills on time?
If you think that occasional late payments will not do any damage, think again.
In this post, we will emphasize 5 important advantages of paying credit card bills on time, especially for credit cardholders.
1. You are badly hurting your credit.
Did you know that late payment can lower your credit score by up to 15%? Yes, even occasional payments can affect your final FICO score, especially if you already have poor credit. On the contrary, paying on time will boost your credit score and get you better rates from lenders.
2. Late payments forfeit rewards and incentives.
Do you own a reward credit card? If you do, you need to be conscious about how you manage your account. Some issuers may disqualify you from redeeming your rewards on account of late payment.
3. Late payments mean additional charges.
Not posting on time would mean paying the late penalty charge. Late fees can range from $15 to $30, depending on the issuer. Imagine how much you can save by not paying this extra cost each month.
4. Late fees could mean interest rate hikes with your other creditors.
Before the new Credit CARD Law was approved, many creditors impose the “universal default” clause. This gives the creditor the power to increase rates based on the borrower’s records with other creditors. Today, the “universal default” clause has been completely eliminated. Nevertheless, if you fall behind your payments for 60 days, your credit card company can still increase your current rate.
5. Unpaid bills cause headaches and stress.
Struggling to catch up with your due dates can be very stressful. In worst cases, a lot of people have found that debt problems seriously affect their personal relationships. Why put yourself through with emotional burden when you can prevent it by paying your bills on time? Obviously, your efforts to pay on a timely manner will surely be rewarded.