One of the realities of the world of consumer credit is that it’s not without humor. And
one of the most misunderstood aspects of credit reporting is what constitutes a late
payment, and what doesn’t.
A 30 day late payment has actually been interpreted by some as being 1 to 30 days past
the due date. That’s an incorrect. A 30 day late payment means that the consumer is
30 days past the due date.
The document that defines how furnishers must report to the credit bureaus is called the
Credit Reporting Resource Guide. And, that guide states “…an account is not deemed
to be delinquent until it is at least 30 days past the due date.” This is a very consumer
friendly approach toward credit reporting, set forth by a rule of the same organizations
that are often accused of having consumer unfriendly policies.
This rule allows consumers to avoid credit report problems if they’re periodically late
because of things like lost mail, online payment snafus, and simple forgetfulness. It
however suggests that 30 day delinquencies are more problematic than originally
thought.
You see, in order for a 30 day late to appear the consumer chose not to make their
payment during the normal grace period, and then an additional 30 days. For credit
cards this means they did not make a payment for a full 51 days after their statement
was delivered. The CARD Act requires credit card issuers to mail or deliver their
statement at least 21 days before they’re due. And, when you add 21 days to 30 days,
you get 51 days of nonpayment.
Mortgages and auto loans have no such grace period requirement because they’re
installment loans. Installment loans have a set number of payment of the same amount,
and they’re normally due the same day each month. Mortgages are due at the first of
the month, but not considered past due until after the 16th gives consumers an additional
14 days to pay their mortgage until it can be reported delinquent to the credit reporting agencies.
Michael B. Citron is an internationally known public speaker and author. He lectures for professional associations worldwide. Michael is a serial entrepreneur who is dedicated to living the American dream, and helping others to do the same. His role at DisputeSuite.com has placed him in the spotlight of the credit repair industry. DisputeSuite is the largest provider of technology and education services to the industry, and has been a catalyst in the forward movement to standardize the credit repair industry.
P.S. DisputeSuite provides a variety of solutions for your credit repair business. From engaging custom websites, to dispute processing services, to a robust CRM with automations and portals, DisputeSuite is a One-Stop Shop to making your Credit Repair Business A Success! Let’s chat today to discover the best plan for you: 727-877-6812 or support@disputesuite.com
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