With the US economy in a high gear downturn and rising unemployment levels, several people are struggling to make their credit card payments. Customers should pay their minimum credit card payment on time or as quickly as possible after the due date to avoid penalties and hurt your credit rating. It is advisable not to accumulate monthly minimum payments because it may become harder to catch up and may even lead to stiffer penalties.

In case of late payment, the card issuer can report the customer to credit bureaus like TransUnion, Experian, and Equifax. This can remain in the credit report for up to seven years. Customers listed with credit bureaus can have their credit score reduced by VantageScore and FICO. In addition, some card issuers declare accounts that fail to make two consecutive payments to be delinquent. This, when reported to credit bureaus, can have a huge impact on one’s credit score.

Apart from paying fees and being declared delinquent, cardholders who miss one payment are at high risk of paying a higher penalty rate in the form of interest rates. In case of missed payment, the card issuer has the option of applying for the penalty annual percentage rate (APR) in case the account becomes delinquent. So what should one do in case they miss on their card payment?

Take Advantage of Your Card’s Grace Period

Most card issuers offer a grace period of 21 days to customers after receiving their statement. This means cardholders don’t have to make the payment immediately; they receive the statement.

Ask your issuer for help

Cardholders who unable to make payments can talk to their issuers to agree on flexible payment terms. The issuer may have options that enable the holder to defer payment on have other flexible payment terms. Some issuers have hardship programs that enable cardholders to make payments in more than one accommodation. A hardship program lowers the client’s interest rates if he or she faces difficult situations that hinder their ability to pay. However, hardship programs should be taken with extreme care as they can lead to freezing your account or slashing your credit limit.