What happens if you miss a credit card or line of credit payment?

You might use your credit card or line of credit to pay for anything from groceries to recurring bills, or something more major like a home renovation or your school tuition. Considering the current pandemic, you may find yourself in a situation where you are unable to meet your current minimum payment requirements on your outstanding credit balances.

Some of the consequences of not paying your bills on time may include:

• You may incur higher annual interest rates on any unsecured credit cards and lines of credit if two minimum payments are not received by your payment due date within 12 consecutive months. This annual interest rate increase from your preferred annual interest rate can result in an increase in your monthly payments. For more information and to see whether this applies to any of your credit products currently, please refer to your Disclosure Agreement provided to you when the account was opened.
  
  
• A reduction to your credit score when you miss or make a late minimum payment on a credit card, line of credit, auto loan, mortgage or other credit product.
  
  
• Lenders may be hesitant to lend you money in the future if you have a poor credit score, which means they may offer lower credit limits or higher interest rates or decline your request.  Revolving accounts may also be closed or have the credit limits reduced if you miss multiple payments, taking away your ability to use the credit.

You can learn about how missing a payment could impact your credit score with the Scotiabank CreditView tool – it's free to use and is considered a soft inquiry, so it will not affect your credit score.

Being scored on your credit can sound intimidating, but it's actually pretty simple. Your credit score is a 3-digit number that tells banks, insurance companies, car dealers, and telecommunications companies and other lenders how likely you are to make your payments on time. It is a simple way for lenders to see how responsible you are with making payments on your credit cards, lines of credit, and/or mortgages or other lending products.

If you do not make payments towards these balances on time, your credit score could drop. As mentioned above, this can make it more difficult to obtain credit in the future or lenders could increase your interest rate.

To learn more, read about why finding out your credit score is a smart financial decision.

Here are a few ways to help you stay on top of your payments:

• Scotia InfoAlerts: These alerts will help you stay on top of your credit card and line of credit payments and other monthly loan payments. When you sign up, we'll send you a message before the due date for your minimum payment and after you've missed a payment. We'll also let you know once your payment has been received.
• Set up recurring transfers to prevent missing payments: To make it even easier, set up automatic transfers to your loans, lines of credit and credit cards each month. Automating your payments means that you won't suddenly realize you've missed a payment and have to pay additional interest or any fees.  Transfers are easy to set up via Scotia Online or Mobile banking. 
  

Scotiabank understands that your current financial situation may be out of your control and is trying to provide relief options that could ease your anxieties in such a turbulent time.

If you require additional financial support, please visit or call a branch to talk to an advisor about solutions that will meet your needs. Find your local branch today through our Branch Locator. Make sure to also take advantage of Scotia's Bank Your Way hub which will help you navigate the various functions and features you can complete through your digital app and online banking.