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It’s never a good idea to stop paying your monthly bills. See the consequences of being late on these common bills.
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Few of us make perfect financial decisions all the time. At some point, you might miss a due date on your monthly bills. (I know I have.)
So, what happens then? The consequences when you don’t pay a bill will depend on how behind you are and the specific type of bill. Here are some general considerations.
If you pay a day or two late
In an ideal world, we’d all have everything on autopay and never have to worry. But stuff happens. Should that “stuff” mean you miss a bill’s due date by a day or two, don’t stress too much. The worst consequence will usually be a late fee.
Even better, you may not even need to pay a late fee. As long as you don’t make a habit of it, many companies will waive an occasional late fee if you pay within 24 or 48 hours. (At the very least, it doesn’t hurt to ask!)
Special considerations: One extra call-out here is your credit card. Paying your credit card even a couple of days late can have two costly consequences:
If you don’t pay your card balance in full by your due date, you lose your grace period. This means your overdue balance will accrue interest. Pay in full as soon as you can to stop that interest from growing.If you currently have an intro 0% APR offer active on your card, paying late may void your offer. In this case, your balances will revert to the go-to APR.
If you pay a few weeks late
Here’s when you’re almost definitely getting a late fee. Beyond that, there isn’t a huge difference between paying two days late or two weeks late for most monthly bills.
Special considerations: The main exception here is rent. While laws vary by state, some states allow landlords to start eviction proceedings when tenants are just 14 days late on their rent. If you rent, it’s a good idea to research the laws in your area so you know your rights.
If you’re more than 30 days past due
When you’re more than 30 days past your due date, the real trouble starts.
For one thing, this is when lenders typically report your account as delinquent to the credit bureaus. Even one late payment on your credit report can tank your credit score. And those late payments will stay on your reports for up to seven years.
How much more trouble you’re in will depend a lot on the specific type of bill.
1. Utilities
What happens when you stop paying your utility bill will vary by state. In general, if you fall too far behind on your utilities, the company can simply shut them off.
However, many states have laws regulating when a utility company can shut off your services. For instance, some states won’t allow utility companies to shut off your gas or electricity if temperatures are below freezing.
The good news is that there are a lot of different programs out there to help you keep the power on. Contact your utility company as soon as you think you may fall behind to work out a payment plan or for more information on assistance programs.
2. Rent
As mentioned above, some states allow landlords to start eviction proceedings well before you’re 30 days past due on rent. That said, you may still be able to get federal or local rental assistance to help with back rent and avoid an eviction.
If the landlord has already filed an eviction lawsuit, you should prepare for your court date. Consulting a lawyer is recommended if you have the ability, though you can also file a written response to the court yourself without a lawyer. Explain what you’re doing to catch up, including any assistance for which you’ve applied. Then it’s up to the judge.
3. Cellphone
Although cellphones have become a virtual necessity for everyday life, the bills don’t have any of the protections you might find with utilities. If you’re more than 30 days late paying your cellphone bill, expect your service to be cut off. Continue to not pay, and say goodbye to your phone number.
4. Credit card
For the first few months after you stop making credit card payments, the bank will try to collect its money. You’ll get calls and letters. But after about 90 days (perhaps up to 120 if the issuer is particularly persistent), the issuer will give up and sell the debt. You’re now in collections.
The collection company is your new bestie, and they’re going to call you a lot. Like, all the time. Thankfully, there are some protections. The law says collection companies can’t harass you, which includes calling more than seven times in a seven-day period. You can also tell them not to call you at work. If a collection company is harassing you, you can file a complaint with the CFPB (Consumer Financial Protection Bureau).
5. Car payment
Repossession laws can vary by state, but in most cases, a lender can repossess your car as soon as you’re delinquent on your loan. The circumstances that qualify as “delinquent” will depend on the terms of your specific loan.
Many lenders will wait until you’re 60 days past due to flag your account as delinquent. (You may even get up to 90 days, but don’t expect any longer than that.) At this point, the lender will hire a repossession company to take your vehicle. It will then be sold by the lender to recover as much money as possible to cover the delinquent balance.
Always reach out
Always, always, always reach out to the company if you think you’re going to be late on a bill. It’s in their best interest to help you pay them, so many companies are happy to work things out.
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