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Does Making Partial Payments Help?

Partial payments will help lower your balance, but you may still end up with a late payment and a hit to your credit.
March 20, 2020
Credit Score, Personal Finance
Does Making Partial Payments Help?
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If you can’t pay a bill, it might seem better to send in a partial payment than to send nothing at all.

Your creditor may cash the check, but that doesn’t mean you’re not considered late. And late payments can have a big impact on your credit.

If you are considering paying less than the minimum payment due:

  • Contact the creditor beforehand. Ask it to accept a partial payment without late fees, to let you skip a payment, or to change the due date. Ask if the payment you’re considering will be reported as late. Find out if the creditor offers hardship programs.
  • Make arrangements to pay the shortfall. If you don’t catch up, it’s very likely that you’ll be reported late every month that the deficiency lingers.
  • Don’t delay the inevitable. If your hardship is not temporary, partial payments are not going to help. Explore debt relief options.

Take control of your money

Use NerdWallet’s free tools, including a breakdown of your debt and trackers for bills and spending.

Lastly, be strategic about your bills if you can’t pay them all in full. Necessities such as rent and food and perhaps transportation are higher priority than, say, student loans or credit cards or debt collectors. (See “How to Pay Bills When You Can’t Pay Your Bills.”)

Here’s a look at how much breathing room you have on different types of debt:

DebtReal trouble starts in ...Potential consequences
Mortgage90 to 120 daysForeclosure, loss of home
Auto loan1 day past due (though many lenders wait 60 days)Repossession, collection of unpaid debt
Federal student loans270 daysWage garnishment, tax refund seizure, partial seizure of Social Security benefits
Private student loans30 daysLawsuit, wage garnishment
Credit cards180 daysAccount charged off, sold to collections
Collections accountsDepends on amount, aggressiveness of collectorLawsuit, wage garnishment
Tax debt10 days after IRS sends first notice demanding paymentWage garnishment, property or bank account seizure
Child supportVaries by stateDriver's license suspension, tax refund seizure, passport revocation, wage or benefit garnishment, property liens, jail
Medical billsDepends on providerAccount turned over to collectors

Does a partial payment affect your credit score?

Partial payments could have a negative impact on your credit score. That’s because your creditor may mark the payment as missed or delinquent if you don’t at least make the minimum payment.

A late payment stays on your credit report for seven years after the account is reported late.  

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