So I'm wondering, what happens when you can't make the minimum payment required by the credit card company but send them something less? What are the repercussions? I'm just curious because I overheard someone talking about this at my job. The lady stated that when she was going through financial hardship, she paid the bills that had to be paid (ie rent, car,utilities, etc.) and all of her credit card bills she just sent them $5-10. She then claimed that she did this for 4 months until she got back on her feet. I didn't have the nerve to ask her how that affected her credit rating, etc. because I didn't know her at all. Can anyone elaborate on this? I'm curious...
RE: Question about minimum pay That will affect her credit rating not only with the credit card company, but with the bureaus. The creditors will probably report that the account was delinquent ("not paid as agreed"). The minimum payment amount is the LEAST amount the creditor will accept each month. It is not up to the customer to choose an amount to send to pay back the LOAN they received from a company. It really is too bad she does not realize that she probably damaged her credit rating. She probably will not know that she has until she attempts to apply for credit & her payment history becomes an issue.
RE: Question about minimum pay The sad part is that she could have explained her situation to the creditors and ask them to reduce her minimum payments for a short time. Quite a few will work with people who immediately discuss their financial problems with them. They are usually less willing to work with those who have dodged bills and phone calls for months before asking for help. I'm sure this also applies to those who act against the credit agreement without discussing it with anyone.
