In the present day world of ever-increasing needs and mounting expenses, it is evident that by the end of the month you are in a cash crunch. At such times, the idea of foregoing one or more of monthly payments can prove to be quite tempting, especially that of skipping your Credit Card bill. However, if you wish to maintain a respectable credit score, you must take a close look at the repercussions of doing so.
Why Shouldn’t You Skip Mortgage Payment?
If you have taken a Loan Against Property, or a secured Personal Loan, missing out on a monthly payment can have an adverse impact on your credit score. A vast majority of lenders allow a delay of 90 days, however, some are more stringent and start the foreclosure process in as little as 30 days. No matter the case, the information regarding the delayed payment is conveyed to the credit bureau.
Moreover, even if you miss a single payment, you will be required to pay two amounts in the coming month, along with the late fee.
Why Shouldn’t You Skip Credit card Bills?
Missing out on the minimum payment towards your outstanding Credit Card bills can result in a late fee, which will keep increasing for every subsequent payment that is skipped. Moreover, your SBI Credit Card or other Credit Card company can even refrain you from using your reward points or flyer miles, until you make the complete payments. Then again, you will always run the risk of the credit bureau being notified!
Why Shouldn’t You Skip Utility Bills?
The first consequence of not paying your electricity or water bill in time is the late fee. Additionally, if you miss multiple payments in a row, your services will most likely be disconnected. In this case, not only will you have to bear the inconvenience, you will also be required to pay an additional fee for the restoration of services.
Unfortunately, the same holds true for missing the due dates for your landline or mobile phone bills!
Why Shouldn’t You Skip Car Loan Payments?
In case you delay the EMI (Equated Monthly Instalment) towards your car loan by more than 30 days, the lender will notify the credit bureau, thereby putting your credit score at risk. Besides, you will be required to pay a late fee. In some cases, repeated delay in payments can also result in an increased interest rate. Lastly, the lender may even resort to the extreme but not uncommon measure of repossession of your vehicle.
Why Shouldn’t You Skip Educational Loans EMI?
The actual repayment of an educational loan starts only after your degree course is complete, and you have received steady employment. However, once you start paying the EMIs, missing out on even a single one, could result in an unwanted blow to your credit score. Of course, missing the payments consequently can and will lead to an increased interest rate, thus further increasing your financial burden!
Simply put, every delay in any one or more monthly bills will cost you a late fee. Besides, you will end up paying a much heftier amount the next month, considering you will need to pay twice as much, along with the late fee. Not only will this add to your financial woes especially in case of mortgage loans, car loans, and educational loans, but will also result in a poor credit score. All of this combined will drastically reduce your chances of getting credit from the bank or any lending agency shortly. The only way out in such situations is to ensure a strict financial discipline so that you do not miss any payment in any case.
However, if things do get out of hands, all you need to do is get in touch with your lender or service provider and convey them the situation. More often than not, they will readily increase your credit limit, or extend your due date. In most cases, they will also waive your late fee. Once this is taken care of, make sure to pay the entire amount at the earliest possible!
We hope that you are now aware of the harsh consequence of skipping your monthly bills, and will be better prepared to pay them well within time. Trust us, this is the best way to enjoy the much-needed peace of mind, and will help also you avert the uncalled for follow-ups from collection agencies!
And yes, if you are determined to make payments as and when stipulated, you should not hesitate to choose from a wide range of Credit Cards, and pick one that best suits your needs. After all, a Credit Card is possibly the best reward you can give yourself for keeping your finances in control.
To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.mymoneymantra.com, the leading online lending marketplace that offers financial products from 70+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.
Talk to our Loan Specialists toll-free at 1800 103 4004 to know more about our products and offers.