Payment History, A Large Part Of Your Credit Score

Payment History – A Large Part Of Your Credit Score

Payment history is a big part of your overall credit score. In 2009 changes were made to the way your credit score is calculated, so an occasional late payment won’t hurt you as much as it used to, but you still need to be on guard.

Here’s what you need to know:

• A few days late does not count against you. A payment cannot be reported late unless it is thirty days or more past due.
  
  
• The big picture matters more now. With the older system, one big problem could cause havoc with your credit score. Now, if all other accounts are in good shape, one serious issue will not matter as much.
  
  
• Small problems hurt less. Previously, if you missed a small bill (less than $100), and it went to collections, you would see a negative impact on your credit score. Now your credit score will not suffer as much from a small misunderstanding.