What Is Credit Card Delinquency?

A stressed couple sits on a sofa worrying over their credit card statement
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Definition

Credit card delinquency is a status indicating that your payment is past due by 30 days or more. A delinquency can affect your credit score and impact your ability to get approved for any new credit-based applications.

Key Takeaways

  • Your credit card is delinquent if you haven’t made at least the minimum payment for a period of 30 days or more.
  • Credit card delinquencies appear on your credit report and will remain there for as long as seven years.
  • You’ll most likely be hit with a penalty rate after 60 days.
  • Your account will probably be “charged off” or closed if you don’t catch up within 180 days.

What Is Credit Card Delinquency?

Your credit card agreement requires that you make monthly credit card payments on time to keep your credit card open and in good standing. Missing your payment by a few days won't make it delinquent, although you could incur late fees. Failing to make the payment for 30 days or more will have much more serious consequences.

How Credit Card Delinquency Works

Your delinquent status is reported to the credit bureaus and is included in your credit report. A late payment is added to your account, and your credit card issuer may begin calling, emailing, or sending letters to urge you to get you caught up again.

Your credit card issuer is permitted to raise your interest rate to the penalty rate when your payment is 60 days delinquent. The penalty rate will remain in effect for six months. It will go back to normal on your existing balance after you make six consecutive payments on time.

Note

Your credit card issuer can keep the penalty rate effective for new purchases on your credit card even after you catch up on your past due balance.

Credit card delinquency isn’t the end of the road. Consumers have a chance to catch and bring their account back into good standing, but it will cost more to get caught up again. You must pay the entire past due balance, plus the interest and late fees that have accumulated.

Your credit card account will eventually be closed and charged off if your balance remains delinquent. This typically happens when your payment is 180 days past due. You'll no longer have the opportunity to catch up and bring your account current again after this happens. The entire balance is due and can be sent to a collection agency if you fail to pay it off with the original creditor.

Contact your credit card issuer to find out your options for getting caught up again If you can’t afford to pay the past due balance.

Note

Consumer credit counseling might be another option for getting caught up, particularly if you're delinquent on multiple credit cards.

Credit Card Delinquency Rates

National credit card delinquency rates indicate how households are handling their debt. Rising delinquency rates generally mean that people don’t have sufficient money to pay their debts, and this could signal larger economic problems.

Delinquency rates at top commercial banks stood at 2.73% in the first quarter of 2020, according to the Federal Reserve Bank of St. Louis. But this rate is significantly less than it was in the second quarter of 2009, when the rate was 6.77% toward the end of the Great Recession.

Can It Be Removed From Your Credit Report?

Negative information is generally only removed from your credit report if it's inaccurate, incomplete, can't be verified, or if it's beyond the credit reporting time limit. You can send a credit report dispute to have it investigated and removed if your credit report includes an erroneously reported credit card delinquency. Send copies of any evidence you have that can support your claim.

Otherwise, credit card issuers are legally permitted to report negative information as long as it’s correct.

Note

Your credit card issuer might be willing to remove the delinquency if you catch up on your payments again.

Catching up on your payments is important to prevent your account from being charged off and your credit from being damaged even more, even if you can't remove the delinquency. Your account status will show that your payments are currently on time when you catch up, and the negative details for the account will fall off your credit report after seven years.

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Sources
The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Consumer Financial Protection Bureau. "When Can My Credit Card Company Increase My Interest Rate?" Accessed Aug. 23, 2020.

  2. Capital One. "Credit Card Charge Off." Accessed Aug. 23, 2020.

  3. Federal Reserve Bank of St. Louis. "Delinquency Rate on Credit Card Loans, All Commercial Banks." Accessed Aug. 23, 2020.

  4. Fair Credit Reporting Act. "§ 1681i. Procedure in Case of Disputed Accuracy." Accessed Aug. 23, 2020.

  5. Fair Credit Reporting Act. "§ 1681c. Requirements relating to information contained in consumer reports." Accessed Aug. 23, 2020.

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