If you’ve missed a payment on your credit card, loan or mortgage, the key is not to panic and to tackle the situation in a considered way. We look at the steps to take.
Firstly, be clear and honest in your own mind why you missed the payment. Was it a genuine moment of being forgetful or are you struggling to get the money to make the payment?
Next make contact with your lender. Do this as soon as possible and truthfully explain what happened.
By doing this you can start to address the issue, make a payment if you can and reduce the chances that your lender will mark your account with a ‘late payment’ and charge you a fee. A ‘late payment’ mark is picked up as part of your credit history.
If you are struggling with making payments your lender may be able to help, possibly by reducing your monthly payments or depending on what type of loan you have you may be able to take a break from making payments.
Agree with your lender how much you will now pay, even if you cannot manage the full amount.
Thirdly make sure you take action to avoid missing further payments
If you really are struggling with wider debt issues it’s important not to ignore them in the hope that they will go away. Invariably they won’t. It may be time to get professional debt advice.
If you did just forget to make the payment, consider setting up a standing order or direct debit from your current account. You will of course have to ensure you have enough funds in the acount to make each payment – otherwise you could end up incurring overdraft charges.
Finally, budget so that you have money available for future payments
Managing your money is vital otherwise you risk the chance of missing loan and other payments and leaving yourself at greater risk of falling into debt or simply causing issue with various providers you deal with.
Consider setting up a budget to understand what money you have coming in each week or month and what is going out. Understand from this the ‘must have’ and the ‘nice to have’ items so that if need be you can identify where you can curtail your spending in order to meet your costs.
There is also money management software available, such as Home Accountz 2012, that can help you understand where you money comes from and goes to.