What is a delinquency on a credit report — and how can you avoid it? (2024)

A delinquency on your credit report indicates a payment that's been late for 30 days or more. This is one of the last things you want to have in your credit history as it can cause significant and long-lasting damage to your score.

Knowing what triggers delinquencies can help you protect your credit. CNBC Select explains how they work and what you can do to avoid late payments.

• How delinquencies affect your credit
• How to check your credit report for delinquencies
• How to avoid late payments
• Bottom line

Delinquencies can have a highly negative effect on your credit. Payment history is the most critical factor influencing your credit, so when a lender or credit card issuer reports that you're late on a bill, you can expect your score to plummet.

The longer the delinquency, the more your scores are likely to suffer. Typically, there are four stages to a delinquency: 30, 60, 90 and 180 days past due. It's usually around the 60-day mark that you start receiving phone calls and emails from your creditor requesting that you pay — after 90 days you run a higher risk of having your account sent to collections.

At 180 days your creditor may charge-off your debt (or sell it to a debt collector). A charge-off might sound like you're off the hook, but it's one of the worst items to have on your credit reports and can weigh down your score like a pair of cement boots.

A delinquency stays on your credit report for seven years from its original date. That means if an account became delinquent in January 2020 but you didn't pay off the debt until March 2020, it should fall off your credit after January 2027.

However, if you paid in March 2020 and then missed another payment a month later, it's likely to be considered a new delinquency with its own seven-year cycle, meaning it should be removed in April 2027 — separately from the January delinquency.

The effect of a delinquency tends to fade with time — but it still doesn't inspire trust in you as a borrower. While you still may get approved for a loan or credit card, you'll probably get higher interest rates resulting in a hit to your wallet as well.

It's always a good idea to keep a close eye on your credit report so you can stay proactive about this essential aspect of your financial life. For instance, if someone gets a hold of your personal information and fraudulently opens an account in your name, you can spot the suspicious activity and dispute it with the credit bureaus before it becomes a delinquency.

Consumers have the right to request a free copy of their credit report every 12 months from each credit bureau at AnnualCreditReport.com. Currently, Experian, Equifax and TransUnion also offer free weekly online credit reports, making it even easier to stay on top of your credit records.

Another convenient and user-friendly option is a credit monitoring service. CNBC Select picked CreditWise® from Capital One as the best overall free service — it offers weekly VantageScore updates from TransUnion and credit report updates from Experian and TransUnion in real-time. Plus, you don't need a Capital One credit card to sign up.

Another excellent option is Experian Dark Web Scan + Credit Monitoring. You'll get real-time alerts about new hard inquiries and accounts opened in your name, as well as other changes to your Experian credit report. Additionally, you'll receive your updated FICO score and credit report every 30 days.

As you can see, the best way to go about delinquencies is to avoid them in the first place. If you have multiple bills to take care of each month, this can be a challenging task. You can try different strategies to ensure you don't miss a payment:

• Sign up for autopay. Most lenders and card issuers offer this feature, allowing you to set up automatic monthly withdrawals from your checking account.
• Set up payment reminders. To gain more control over when you make payments, you can set reminders for your bills' due dates and pay manually. Often, your credit issuer or lender provides this option through an online account, or you can use a budgeting app like Mint.
• Change your payment due date. If your creditors offer this option, you may want to spread your due dates over the month to match your paycheck schedule — or do the opposite and pay everything on the same day of the month. Whatever helps you stay current with your bills.
• Stay in touch with your lenders and issuers. When you hit the hard times and worry you'll miss a payment, contact your creditors as soon as you can. They might offer you options, such as giving you more time or signing you up for a relief program.

If you already have a delinquency, discussing any possible solutions with your creditor still might help. The next step is to prioritize getting out of debt and prevent late payments from happening again.

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At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every credit guide is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit monitoring products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best credit monitoring products.

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