What Happens If I Miss a Loan Payment?

Missing a Monthly Loan or Credit Card Payment

Most loan terms include one monthly minimum payment, though some borrowers choose to make additional payments or pay more towards their balance when the terms allow. Whether or not you decide to pay extra, you must make the monthly minimum payment as agreed upon with your lender to remain in good standing and avoid fees.

If you miss or pay less than the minimum payment, the loan is considered unpaid. A missed payment can have any or all of the following consequences:

• Late fees – Late fees vary between lenders and loan types. If this is your first time missing a payment, a lender may choose to waive all or part of a late fee as a reward for otherwise good payment habits or accounts in good standing. Late fees are disclosed in the loan terms or fee schedule for loans and credit cards.
• Interest – Interest is built into most loan terms and will apply whether a loan is paid on time or not. However, one can avoid ever paying any interest on a credit card if it is always paid in full before the due date. If a balance is carried over from month to month (called a “revolving balance,”) it will accrue interest. Learn how credit card interest is calculated.
• Impact on credit score – Missing a payment can cause a huge hit to your credit score, sometimes as many as 180 points. Fortunately, due to federal law, lenders must wait 30 days before reporting missed payments to the credit bureaus Equifax, Experian, and TransUnion. Late payments made before the 30-day cutoff may have no impact. Any late payments will appear on your credit report, which you can request here.

Missing a Mortgage Payment

No one wants to miss such an important payment, but accidents happen. Most mortgage loan servicers offer a 15-day grace period in which you can make a payment without late fees or penalties, though you should always double-check with your lender when you make a payment past its due date.

Multiple missed payments will incur not only additional late fees, but also put the loan servicer in direct contact with you to discuss your options and potential consequences. Several missed mortgage payments can result in foreclosure proceedings and can lead to the loss of your home.

What to Do if You Miss a Payment

Accidents or unforeseen events happen, and you would not be the first or last person to ever miss a payment on a loan. If you miss a payment, follow these steps:

1. Contact your lender as soon as possible. Contact the customer service team and find out your options and the potential fees you can expect to pay.

2. Make the payment as soon as you can. If you are able to make the payment, do so. Depending on how far after the due date you make the payment, the late fee may change. Depending on your loan agreement, you may be able to avoid serious consequences if you make a payment within 30 days or work with your lender to find a solution.

3. Strategize to avoid missing payments in the future. Continue reading below to learn strategies to minimize missed payments and apply the method of your choosing.

Ways to Avoid Missing a Payment

With today’s technologies, you don’t have to depend on a payment calendar and checkbook to pay your bills on time. You can pay bills online or from your smartphone, have your financial institution make payments on your behalf, or set bills to withdraw funds automatically. You can choose a different method for each bill you have or streamline everything with one convenient service.

Here are the ways you can make a payment with American Heritage Credit Union:

• Online Teller – Via desktop or laptop computer, log into your Online Teller account using your web browser. Make a loan payment by transferring funds directly or by using our Bill Payer service.
  • Bill Payer – located within Online Teller and Mobile Teller, you can add payees and control the amount of the payment and the designated date that the payment is sent. You can schedule payments in advance or set up recurring payments.
• Mobile Teller – The convenience of Online Teller in the palm of your hand! Download the Mobile Teller App from the Apple App Store or Google Play Store to access your account from your smartphone.
• Quickpay – Sign up for Online Teller to utilize our QuickPay service. When you sign into your account, navigate to the "QuickPay and Transfer" tab of your Online Teller account and select Loan Payment. From here, you will need to authenticate your account and enroll into the QuickPay service before you can schedule or set up payments.
• Autopay – Typically, you can enable autopay in individual bill portals. Using this method, you can set up automatic ACH (Automated Clearing House) transfers, which are electronic payments made between banks. You can enable autopay using your American Heritage accounts where available from within your individual billing accounts such as utilities, streaming services, and more.
• Visit – Stop by your local American Heritage branch and pay in person.
• By Mail – Send a check by mail to 2060 Red Lion Road, Philadelphia, PA 19115
• Call Us – Make a payment over the phone by calling our Contact Center at 215.969.0777