Today’s Credit Week Tip: Never be late with a payment.
The most important component of your credit score is your payment history. Just one late payment on your bills or your credit card debt can drop a credit score from 750 to 650, and that may dramatically increase your borrowing costs.
Generally you are not considered to be late until you are 30 days past due, but you should never risk being even one day late.
The best way to make sure your payments are received on time is to pay all bills electronically. By programming the payment dates into your bank’s on-line banking system, you know that all bills will be paid on time.
Another option is to set up pre-authorized payments with your utilities and other bills. Your gas and hydro company can put you on an equal monthly billing plan, where they take the payments automatically on the same date each month. That’s a great way to never miss a payment, and to keep your credit report in perfect shape.