Your card issuer will report the missed payment to credit bureaus, charge you fees and interest, and eventually pursue collection or legal action if the debt goes unpaid long enough.

The sequence is predictable. After you miss a payment, your card issuer marks it as late on your credit report within 30 days. They charge a late fee (typically $25 to $40 for the first miss, higher for repeat offenses) and apply a penalty interest rate to your balance—often 25% to 30% APR, even if your regular rate was lower. Your minimum payment grows because the issuer adds the missed amount to what you now owe.

If you don't pay for 60 days, the late mark worsens on your credit report. At 90 days unpaid, the account is formally delinquent. At 120 to 180 days, the card issuer typically closes your account and sells the debt to a collection agency or pursues collection themselves. From that point forward, a collector can contact you by phone, mail, or email—with legal limits on how often and when.

The damage to your credit score is immediate and severe. A single 30-day late payment can drop your score 100 points or more, depending on your current score and payment history. A 90-day delinquency is worse. This affects your ability to borrow for a car, mortgage, or another card for years.

Key Takeaways

  • Late fees and penalty interest rates kick in immediately after a missed payment, increasing what you owe faster than your regular balance would grow.
  • Credit bureaus receive the late report within 30 days, and the damage to your score worsens at 60, 90, and 120 days of non-payment.
  • After 120 to 180 days unpaid, the card issuer typically sells the debt to a collection agency, which can then contact you repeatedly.
  • Collection accounts remain on your credit report for seven years from the date of first delinquency, even if you pay them later.
  • If the debt is large enough, the creditor or collector may pursue a lawsuit and seek a judgment against you, which can lead to wage garnishment or bank levies.

How the First 30 Days Work

Missing a single payment triggers immediate consequences. Your card issuer charges a late fee—the amount depends on your card's terms, but federal law caps it at the greater of $25 or 1% of the minimum payment due. If you have a history of late payments, the fee can be higher, up to $40.

Your interest rate also changes. Most cards include a clause that raises your APR to a penalty rate if you miss a payment by 60 days or more. However, some issuers apply the higher rate immediately after a 30-day miss. Check your card's terms to know which applies to you. This penalty rate typically stays in place for at least six months, even if you catch up on payments.

The credit bureaus—Equifax, Experian, and TransUnion—do not receive notice of a late payment until the issuer reports it, which usually happens around day 30. Once reported, the late mark appears on your credit report and begins affecting your score. The impact is largest if you have a good payment history; a first late payment on an otherwise clean record can drop your score more than a late payment on an account with existing problems.

What Happens at 60 and 90 Days

At 60 days past due, the late mark on your credit report becomes more severe. Your score drops further. The card issuer may send a collection letter or call you directly, warning that your account is at risk of being charged off. This is your last window to catch up before the account moves to formal collection status.

At 90 days past due, your account is officially delinquent. The issuer reports this to the credit bureaus as a 90-day late payment, which is a major red flag to future lenders. Your score continues to fall. The issuer may also increase your minimum payment or demand the full balance immediately, depending on your card's terms.

Some issuers offer hardship programs at this stage—temporary payment reductions, interest rate freezes, or fee waivers if you contact them and explain your situation. These programs are not automatic; you have to ask. If you reach out to your issuer before the account is charged off, you have more negotiating power than after it moves to a collector.

Charge-Off and Collection Agency Involvement

Between 120 and 180 days unpaid, the card issuer typically charges off the account. This means they write it off as a loss on their books and stop trying to collect it themselves. They then sell the debt to a third-party collection agency or a debt buyer for a fraction of what you owe—often 5 to 15 cents on the dollar.

Once a collector owns the debt, they take over contact with you. Under the Fair Debt Collection Practices Act (FDCPA), they can call you, send letters, and email you—but only between 8 a.m. and 9 p.m. in your time zone, and not at work if they know your employer prohibits it. They cannot threaten you, use profanity, or contact you repeatedly in a short period. You have the right to send them a written request to stop contacting you, though this does not erase the debt.

The charge-off itself remains on your credit report for seven years from the date you first missed a payment, even if you pay the collector later. Paying does not remove it, though some collectors will agree to remove it in exchange for payment—get this in writing before you pay.

Lawsuits and Wage Garnishment

If the debt is large enough, the collector or the original card issuer may file a lawsuit against you. The threshold varies by state and by collector, but generally debts over $1,000 are more likely to be pursued in court. You will receive a summons and complaint, usually by mail or in person.

If you do not respond to the lawsuit within the time allowed (typically 20 to 30 days, depending on your state), the collector wins by default judgment. With a judgment in hand, they can pursue wage garnishment—a court order that forces your employer to send a portion of your paycheck directly to the collector. The amount varies by state but is often 10% to 25% of your disposable income.

A judgment can also lead to a bank levy, where the collector freezes your bank account and takes money directly. Some states protect certain income (like Social Security) from garnishment, but others do not. If you receive a summons, responding in court—even if you cannot pay the full debt—gives you a chance to negotiate a payment plan or dispute the claim.

How This Affects Your Credit Score and Borrowing

A missed payment damages your credit score in two ways: the late mark itself, and the lower average age of your accounts if the card issuer closes your account. If you have a score of 750 or higher, a single 30-day late payment can drop it 100 points or more. If your score is already lower, the impact is smaller in absolute terms but still significant.

The damage is not permanent, but it is long-lasting. A 30-day late payment stays on your report for seven years. A 90-day or charge-off mark also stays for seven years. After about two years of on-time payments on other accounts, the impact on your score begins to fade, but the mark itself remains visible to lenders for the full seven years.

During those seven years, you will find it harder to borrow. Credit card issuers may deny you or offer only high-interest cards. Mortgage lenders typically require at least two years of clean payment history after a late payment, and some require longer. Auto lenders are more flexible but will charge you a higher interest rate. Landlords and employers may also check your credit report, and a delinquency can hurt your chances of renting or getting hired.

Options If You Cannot Pay

If you see a missed payment coming, contact your card issuer before it happens. Explain your situation and ask about hardship programs, temporary payment reductions, or interest rate freezes. Issuers are more willing to work with you before you miss a payment than after.

If you have already missed a payment, contact the issuer immediately. Some will reverse a late fee if you pay within a few days and have a good history. If the account is already with a collector, you can negotiate a settlement—offering to pay a lump sum for less than the full balance. Get any settlement agreement in writing before you pay, and specify whether the collector will report the account as "paid in full" or "settled" (settled is less damaging to your score).

If you are facing multiple debts you cannot pay, consider speaking with a nonprofit credit counselor. The National Foundation for Credit Counseling (NFCC) offers free or low-cost counseling and can help you create a budget or explore a debt management plan. Do not confuse this with for-profit debt settlement companies, which often charge high fees and make promises they cannot keep.

Frequently Asked Questions

How long does a missed payment stay on my credit report?

A late payment stays on your credit report for seven years from the date you first missed the payment. After seven years, it falls off automatically. The damage to your score fades faster—usually within two to three years of on-time payments—but the mark itself remains visible for the full seven years.

Can a credit card company sue me for not paying?

Yes, if the debt is large enough and your state allows it. Most card issuers or collectors pursue lawsuits for debts over $1,000, though this varies. If you are sued and lose, they can garnish your wages or levy your bank account, depending on your state's laws. Responding to the lawsuit gives you a chance to negotiate or dispute the claim.

What is the difference between a charge-off and a collection account?

A charge-off is when the card issuer writes off the debt as a loss on their books, usually after 120 to 180 days unpaid. A collection account is when a third party (a collector or debt buyer) takes over the debt and pursues payment. Both damage your credit, and both can stay on your report for seven years.

If I pay a collection account, does it disappear from my credit report?

No. Paying a collection account does not remove it from your credit report. It will still appear for seven years from the original delinquency date. However, paying it stops future collection calls and prevents wage garnishment. Some collectors will agree to remove the account in exchange for payment—get this in writing before you pay.

Can I negotiate with a collection agency?

Yes. Collectors often accept settlements for less than the full balance, especially if the debt is old or they believe you cannot pay the full amount. Offer a lump sum in exchange for deletion or a "paid in full" status. Get any agreement in writing before you pay, and specify exactly what the collector will report to the credit bureaus.