Missing loan payments can affect your credit in many ways. Here is the process of how late payments work:

Late payments are reported on day 30, 60, 90, 120, 150, and 180, which are negative marks on your credit score. At this point, the account is charged off. A charge-off is another new negative mark on your credit.

Once a collections agency is notified that creates a new mark.

All these negative marks can remain on your credit report and negatively affect your credit for 7 years.

If you receive pre-approved credit card offers in the mail, you may be wondering where they come from.
Keep in mind that receiving a preapproved credit card offer does not impact your credit score. So you’re safe there.

But, accepting the offer will negatively affect your credit.

So why you may be under the impression that the credit card will be easy to get and won’t impact your score, you could get impacted once the loan goes through.

When the lender requests your credit info, it will be in the form of what is known as a “hard inquiry” on your credit. That means a record of this inquiry will remain on your credit report for 24 months.

Because of this be cautious about who you inquire with. The more offers you accept, the more hard inquiries are made on your credit.

Peer to peer lending is an online platform that allows you to borrow directly from an individual instead of from an institution.

Peer to peer lending is growing in popularity because it’s a simple process that’s a win-win for borrowers who pay low interest rates and investors who earn high interest rates.

You can borrow for as little as 6% and earn an average return in the double digits.

Here’s how it works…

Borrowers post a loan listing that includes the amount they want and why they want it. Investors review loan listings and choose the ones that meet their criteria.

Peer to peer lenders screen all applicants and check the credit, which becomes part of your loan listing. Your credit will still mean something, but an individual investor may be more empathetic to your situation than a traditional bank.