NEW YORK -- Are you buried under Christmas debts? Were bills piling up even before? You may find yourself behind on your credit-card bills, leaving blots on your credit report. Every lender has different rules for handling delinquents. But here are some general answers to the question: "What if I can't pay?"
* What happens if I pay my credit cards late? Each statement will carry a late fee in the $10 to $20 range. You may be reported to the credit bureau as slow-pay if you haven't paid within 30 days. Other lenders wait for 60 days. An occasional late check won't hurt your retail credit. But mortgage lenders may demand an explanation for any late payment within the past two years, says Norm Magnuson, director of public affairs for the Associated Credit Bureaus.
* What happens if I miss a payment? After the first month, you'll get a letter or phone call from the bank. At that point, or one month later, your charge privileges will be suspended. New cards are suspended more quickly than older ones. If you try to use the card, it will be rejected at the cash register.
* If my card is suspended, can I get it back? Usually yes, as long as you pay enough to bring your card up to date. But if you miss two payments, some issuers will raise your interest rate for a year, says Ruth Susswein, executive director of Bankcard Holders of America.
If you rack up two or three 60-day payment gaps, or don't pay for three months or more, your account will probably be revoked. You might still recover your card by making back payments. But the bank may reduce your credit limit -- perhaps leaving you too little credit for large purchases or business travel.
After six months or less, your account will be reported to the credit bureau as a charge-off. Even if you repay, that lender is unlikely to restore your card. When you think you can pass a credit review, go to a different lender.
* Why bother repaying if I already have a charge-off on my credit record? You can't remove this credit blot by bringing your account up to date. It will stay there for seven years, warning other creditors to beware. But the record will also show if you eventually paid, says Clarence Weaver, senior vice president of operations at Wachovia Bank Card Services in Atlanta (check your credit report, to be sure). Making payments gives you a better shot at new credit than if you let the delinquency stand.
* Will the lender sue? That depends on how much you owe, what assets you have and where you live. Some states make it easier than others for a creditor to win a lawsuit and collect. The cost of filing suit is also an issue; one county might charge $45 and another, $140. Wachovia says it might sue for $500 in a pro-creditor state, if you have assets and the cost of the lawsuit is less than it hopes to recoup. Key Federal Savings Bank in Havre de Grace, Md., says its lawsuit trigger is closer to $1,000.
* Can I keep the one or two credit cards that are up-to-date, even though I've stopped paying others? That depends on how lucky you are. Wachovia checks a random sample of its customers' credit reports every month. If yours is picked, and the bank sees you're seriously delinquent on other bills, your Wachovia card will be suspended even though it's up-to-date. You probably won't get your charge privileges back until you can bring all your debts up-to-date. Key Federal reviews credit reports annually when customers' cards are renewed.
* If my credit cards are taken away, what should I do? Start a repayment plan, perhaps through a local office of the Consumer Credit Counseling Service (for an office near you, call ([800] 388-2227). The initial consultation is free.
Once your payments are current -- even if you're repaying the minimum or are on a reduced repayment plan -- you might qualify for a secured card. Secured Visa and MasterCards are issued to people who have had credit problems in the past, but will guarantee payment by depositing money in a savings account. Your own bank may offer secured cards. Or send $4 for a list of secured cards, and who qualifies, to Bankcard Holders of America, 524 Branch Drive, Salem, Va., 24153.
Jane Bryant Quinn is a syndicated columnist. Write to her at: Newsweek, 444 Madison Ave., 18th Floor, New York, N.Y., 10022.