Avoid late payments and get a better credit history report

How has technology changed the issue of a person's credit history?

The biggest change is that any negative issue, even paying late one time on a credit card, can immediately be recorded on your credit history. Another problem is that removing negative information is not easy. When credit histories used to be just a series of paper pages it was easy to remove something and be sure there was no other copy of it. Nowadays, removing an item from one database may not affect another, and, as most of us computer users know, things are never really deleted. Some experts warn that negative information can stay on a person's credit history for ten years.

How detrimental is a single lapse in a payment?

Bank Rate warns that a single late payment on just one account can cost a person higher rates and fees on all of his or her credit accounts, including auto insurance.

Can a person stop a creditor from putting a late payment notice on his or her credit history?

The answer is maybe one time, but not more than that. Credit companies continually hear how their customers cannot pay their bills on time. If there ever was any human compassion from the creditors it has long since gone away.

It is the credit card companies that invented, with the blessings of Congress, the universal default system that allows the creditors to raise the interest on a debt if the consumer has been late on only one payment to any another creditor. If you ever open a credit card bill and find your interest rate has exploded, you have been bitten by universal default.

Many people will advise the consumer to just call the creditor and explain your situation and then negotiate. Good theory, but I have never known of anyone who has done this successfully. The reality is that credit companies have outsourced their customer service lines to the point that when you finally get through to the creditor you are more than likely speaking with someone in a foreign country who is required to follow a prepared script and has no understanding of how we live in the United States.

There is very little room for negotiation when the creditors know they will be able to raise your interest rate if they report that one late payment. Face it - the creditors are not the consumer's friend.

Is there a grace period on bill payments before the damage is done?

With technology there is no grace period. You must have your payment into your creditor on the date due. Prior to the current computerizing of the credit card companies and banks, a person could figure that an envelope with the payment check inside would need to opened by a person, the information entered by hand on the computer, the check sent to another bank to clear, the funds then entered by hand, and a grace period of at least five days.

Now the same machine that opens the mail also sorts the checks, enters the data, and procures money from your account in a shorter time than it took to read this sentence.

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