Desoto County News

Harris: How late payments affect your credit score

By: Charlestien Harris

Aug. 14 is celebrated as National Financial Awareness Day. Although that day has passed, I want to ensure that my articles provide essential information to enhance the financial capabilities of my readers. 

Often, I hear people ask, “Why is it so important for me to pay my bills on time? As long as they get my money, they should be satisfied.” While it’s true you have paid your creditor what you owe them, the fact of the matter is that there is a due date, and your payment is expected by then.

Few people understand the effects that late payments can have on their credit score. Thirty-five percent of your credit score is determined by your credit history. You might wonder why that is so crucial. Our bill payment habits shape a payment history that reflects our personal financial behavior.

Credit scoring is a system that creditors use to decide whether to extend credit to you. Information about your accounts and credit usage habits, such as bill payment history, the number and type of accounts, collections, amount of outstanding debt, and the duration of your active accounts, are some of the categories gathered from your credit applications and credit report.

Credit bureaus employ a statistical formula that compares the aforementioned categories of information with data from consumers who have similar credit usage profiles. Once the description of the credit profile is established, the scoring system assigns points to each factor that aids in predicting who is most likely to repay a debt. The accumulation of these factored points results in your credit score, a score that helps lenders anticipate your creditworthiness – in other words, how likely you are to repay a loan and make timely payments.

Your credit report plays a pivotal role in most credit scoring systems. Thus, it is imperative to pay your bills punctually. Equally vital is ensuring that the information contained in your credit report is current and accurately mirrors your genuine financial history.

You can download a credit report review checklist from to help you scrutinize your report and identify potential discrepancies that need to be disputed. Additionally, you can obtain a free copy of your credit report from These tools can assist you in managing your bill payments and comprehending the impact of late payments on your credit score.

I also encounter comments that credit scoring is unjust and does not truly reflect a person’s character. Credit scoring is grounded in real data collected from your own credit experiences and statistics, making it generally more reliable than subjective or judgmental methods. It treats all applicants impartially, as it relies on numbers and statistics, not personal familiarity or relationships.

Under the Equal Credit Opportunity Act, a credit scoring system may not employ certain characteristics, such as race, sex, marital status, national origin, or religion as factors. Age and whether an applicant receives public assistance also cannot influence credit scoring.

So, have you paid your bills on time this month? Payment history significantly impacts your credit score. It is likely that your score will be adversely affected if you have paid bills late, had an account sent to collections, or filed for bankruptcy.

If you tend to make late payments, you might consider following this simple suggestion: Learn to organize, track, and prioritize your bills and expenses. The more prepared you are for anticipated bills, the better you can save for them. Establishing a plan and system for paying your bills can simplify on-time payments and reduce your stress levels.

For further information on this financial topic, feel free to reach out to me at 662-624-5776 or email me at

Until next week – stay financially fit!

Charlestien Harris is a financial contributor to DeSoto County News. She is a financial expert with Southern Bancorp Community Partners whose articles are seen in a number of publications around the region. You’ll be seeing her columns weekly on the DeSoto County News website and our social media channels.

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