What to Do if You're Delinquent on Debt

Edited by Hannah Locklear

Most creditors will declare your account the moment you miss a payment, you will also most likely get a grace period if you happen to forget or be a few days late. Despite this, you need to act quickly in order to avoid fees as well as damage to your credit score.

There are a few things you need to know about delinquent debt. First off, debt becomes delinquent the day after you first miss a payment. This does not necessarily mean that you are going straight into default, because there is often a grace period. The grace period is a window of time that you have to pay off missed payments and get everything back on track.

Despite this, lenders can begin to charge additional fees or penalties after being delinquent on a loan. This is the time where grace periods are going to be very important if you miss a payment. They vary according to the type of debt you have, so you need to look into the agreement you have with your lender. It is common to have a 30-day grace period for most debt except mortgages which are given 15 days before a late fee. (Mortgages usually have a 5% fee of whatever your monthly payment amount is.)

When it comes to a credit card, your late fee typically occurs very closely to after you miss a payment. Some lenders may give you a grace period up to when your next payment is due. The late fee ranges from $20 to $50, but you may also have an APR that could go as high as 30%.

Having a delinquent debt means that your credit score will most likely be lower as well. This will also make it more difficult and expensive to borrow money in the future. If you have a delinquent bill your score may drop by up to 80 points for a personal loan, 100 points for a student loan, and up to 125 points for a credit card payment.

Finally, a delinquent bill that you do not pay, will go into default. It will depend on the type of bill it is, as well as the lender. This should not be ignored because it will come back to bite you if not and get worse and worse.

Don't ignore debt collectors. Respond fast with SoloSuit.

Delinquency vs. default

Default is the end result that occurs after a delinquent debt has been left for a long period of time. It usually refers to missing multiple payments over various months, but the time period depends on what type of account it is.

For example, if you are delinquent on a mortgage or private student loan, it means you are 90 days late. Credit cards are considered delinquent at 180 days, while federal student loans are considered delinquent at 270 days.

What to do if you're delinquent on debt

Check your credit report. You can access all of your different credit reports from the credit bureaus. This will allow you to know which of your accounts is considered late and has been reported.

• Contact your lender. Before you miss a payment it is best to reach out to the lender or creditor who is in charge of your loan. This will possibly give you a chance to set up a payment plan and keep your account in good standing or get it back to where it was.
• Find a credit counselor. Credit counselors are financial professionals who are trained to help borrowers in serious debt. These people can help you make a budget, get you into a debt management course, and even sometimes help stop collection calls.
• Use your savings. Although it should be your last option if you have a retirement account or emergency fund you may want to dip into it. This can help you keep your credit high, and help avoid making the situation a lot worse. It is good to be aware that sometimes there are penalties, but when it comes to a Roth IRA you can withdraw contributions without paying taxes or penalties.
• Get a debt consolidation loan. If you are struggling to pay off multiple debts, then you may want to look into a debt consolidation loan. It is good to note that this will only work if you have good credit and a steady income. Debt consolidation loans can help you put all of your accounts into one payment with a lower interest rate. In some cases, the origination fees can be extremely high, so it is important that you look out for this before agreeing to it.

Protect your assets by responding to debt collectors with SoloSuit.

How to remove a delinquent account

Late payment notices and collection notices stay on your credit report for up to seven years. This is always after the original delinquency date. Despite this, as each year passes the impact on your score will change. Removing this delinquency is not easy, so the best thing to do is to avoid it before it happens. If this is not possible, you can ask your creditor for a goodwill adjustment if you have generally been in good standing.

For example, if your missed payment was due to something like a natural disaster or an accident. Another option is to make the repayment terms on a “pay to delete” basis. This would mean that if you pay it, they will take it off of your report. Despite this, the best way to fix your score and remove a delinquent account is to simply pay it off and budget better in the future.

What is SoloSuit?

SoloSuit makes it easy to respond to a debt collection lawsuit.

How it works: SoloSuit is a step-by-step web-app that asks you all the necessary questions to complete your answer. Upon completion, you can either print the completed forms and mail in the hard copies to the courts or you can pay SoloSuit to file it for you and to have an attorney review the document.

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

>>Read the NPR story on SoloSuit: A Student Solution To Give Utah Debtors A Fighting Chance

How to answer a summons for debt collection in your state

Here's a list of guides for other states.

All 50 states.

Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri

Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah; File a Motion to Satisfy Judgment Vermont Virginia Washington West Virginia Wisconsin Wyoming

Guides on how to beat every debt collector

Being sued by a different debt collector? We're making guides on how to beat each one.

• Absolute Resolutions Investments LLC
• Accredited Collection Services
• Alliance One
• Amcol Clmbia
• American Recovery Service
• Asset Acceptance LLC
• Asset Recovery Solutions
• Associated Credit Services
• Autovest LLC
• Cach LLC
• Cavalry SPV I LLC
• Cerastes LLC
• Colinfobur
• Covington Credit
• Crown Asset Management
• CTC Debt Collector
• Cypress Financial Recoveries
• Delanor Kemper & Associates
• Eagle Loan of Ohio
• Educap
• Estate Information Services
• FIA Card Services
• Forster & Garbus
• Freshview Solutions
• Fulton Friedman & Gullace LLP
• Harvest Credit Management
• Howard Lee Schiff
• Hudson & Keyse LLC
• Integras Capital Recovery LLC
• Javitch Block
• Jefferson Capital Systems LLC
• LVNV Funding
• Mannbracken
• Mariner Finance
• Medicredit
• Michael J Adams PC
• Michael J Scott
• Midland Funding LLC
• Mullooly, Jeffrey, Rooney & Flynn
• Mountain Land Collections
• MRS Associates
• National Collegiate Trust
• Nationstar Foreclosure
• Northstar Capital Acquisition
• NCEP LLC
• NRC Collection Agency
• OneMain Financial
• Palisades Collection LLC
• Pallida LLC
• Paragon Revenue Group
• Pinnacle Collections Agency
• PMAB LLC
• Portfolio Recovery Associates
• Provest Law
• PYOD LLC
• Reunion Student Loan Finance Corporation
• Revenue Group
• Regents and Associates
• RSIEH
• Salander Enterprises LLC
• Second Round Sub LLC
• Security Credit Services
• Sherman Financial Group
• Suttell and Hammer
• T-Mobile
• Transworld Systems
• Tulsa Teachers Credit Union
• UCB Collection
• Velo Law Office
• Velocity Investments
• Waypoint Resource Group
• Weinberg and Associates
• Wolpoff & Abramson

Win against credit card companies

Is your credit card company suing you? Learn how you can beat each one.

• Bank of America
• Capital One
• Chase
• Credit One Bank
• PayPal Synchrony Card
• SYNCB/PPEXTR
• Synchrony Bank
• Target National Bank
• Wells Fargo

Going to Court for Credit Card Debt — Key Tips

How to Negotiate Credit Card Debts

How to Settle a Credit Card Debt Lawsuit — Ultimate Guide

Get answers to these FAQs

Need more info on statutes of limitations? Read our 50-state guide.

Why do debt collectors block their phone numbers?

How long do debt collectors take to respond to debt validation letters?

What are the biggest debt collector companies in the US?

Is Zombie Debt Still a Problem in 2019?

SoloSuit FAQ

If a car is repossessed, do I still owe the debt?

Is Portfolio Recovery Associates Legit?

Is There a Judgment Against Me Without my Knowledge?

Should I File Bankruptcy Before or After a Judgment?

What is a default judgment?— What do I do?

Summoned to Court for Medical Bills — What Do I Do?

What Happens If Someone Sues You and You Have No Money?

What Happens If You Never Answer Debt Collectors?

What Happens When a Debt Is Sold to a Collection Agency

What is a Stipulated Judgment?

What is the Deadline for a Defendant's Answer to Avoid a Default Judgment?

Can a Judgement Creditor Take my Car?

Can I Settle a Debt After Being Served?

Can I Stop Wage Garnishment?

Can You Appeal a Default Judgement?

Do I Need a Debt Collection Defense Attorney?

Do I Need a Payday Loans Lawyer?

Do student loans go away after 7 years? — Student Loan Debt Guide

Am I Responsible for My Spouse's Medical Debt?

Should I Marry Someone With Debt?

Can a Debt Collector Leave a Voicemail?

How Does Debt Assignment Work?

What Happens If a Defendant Does Not Pay a Judgment?

How Does Debt Assignment Work?

Can You Serve Someone with a Collections Lawsuit at Their Work?

What Is a Warrant in Debt?

How Many Times Can a Judgment be Renewed in Oklahoma?

Can an Eviction Be Reversed?

Does Debt Consolidation Have Risks?

What Happens If You Avoid Getting Served Court Papers?

Does Student Debt Die With You?

Can Debt Collectors Call You at Work in Texas?

How Much Do You Have to Be in Debt to File for Chapter 7?

What Is the Statute of Limitations on Debt in Washington?

How Long Does a Judgment Last?

Can Private Disability Payments Be Garnished?

Can Debt Collectors Call From Local Numbers?

Does the Fair Credit Reporting Act Work in Florida?

The Truth: Should You Never Pay a Debt Collection Agency?

Should You Communicate with a Debt Collector in Writing or by Telephone?

Do I Need a Debt Negotiator?

What Happens After a Motion for Default Is Filed?

Can a Process Server Leave a Summons Taped to My Door?

Learn More With These Additional Resources:

Need help managing your finances? Check out these resources.

How to Make a Debt Validation Letter - The Ultimate Guide

How to Make a Motion to Compel Arbitration Without an Attorney

How to Stop Wage Garnishment — Everything You Need to Know

How to File an FDCPA Complaint Against Your Debt Collector (Ultimate Guide)

Defending Yourself in Court Against a Debt Collector

Tips on you can to file an FDCPA lawsuit against a debt collection agency

Advice on how to answer a summons for debt collection.

Effective strategies for how to get back on track after a debt lawsuit

New Hampshire Statute of Limitations on Debt

Sample Cease and Desist Letter Against Debt Collectors

The Ultimate Guide to Responding to a Debt Collection Lawsuit in Utah

West Virginia Statute of Limitations on Debt

What debt collectors cannot do — FDCPA explained

Defending Yourself in Court Against Debt Collector

How to Liquidate Debt

Arkansas Statute of Limitations on Debt

You're Drowning in Debt — Here's How to Swim

Help! I'm Being Sued by My Debt Collector

How to Make a Motion to Vacate Judgment

How to Answer Summons for Debt Collection in Vermont

North Dakota Statute of Limitations on Debt

ClearPoint Debt Management Review

Indiana Statute of Limitations on Debt

Oregon Eviction Laws - What They Say

CuraDebt Debt Settlement Review

How to Write a Re-Aging Debt Letter

How to Appear in Court by Phone

How to Use the Doctrine of Unclean Hands

Debt Consolidation in Eugene, Oregon

Summoned to Court for Medical Bills? What to Do Next

How to Make a Debt Settlement Agreement

Received a 3-Day Eviction Notice? Here's What to Do

How to Answer a Lawsuit for Debt Collection

Tips for Leaving the Country With Unpaid Credit Card Debt

Kansas Statute of Limitations on Debt Collection

How to File in Small Claims Court in Iowa

How to File a Civil Answer in Kings County Supreme Court

Roseland Associates Debt Consolidation Review

How to Stop a Garnishment

Debt Eraser Review

Do Debt Collectors Ever Give Up?

Can They Garnish Your Wages for Credit Card Debt?

How Often Do Credit Card Companies Sue for Non-Payment?

How Long Does a Judgement Last?

​​How Long Before a Creditor Can Garnish Wages?

How to Beat a Bill Collector in Court