If an individual has a credit score of 560 and they pay their credit card late once or twice, what might they expect a credit card company to do?(1 point)
Responses
Close their account.
Close their account.
Offer them a lower APR to lower payments
Offer them a lower APR to lower payments
Send the account to collections
Send the account to collections
Increase the APR to 24% or higher and charge a late fee.
Increase the APR to 24% or higher and charge a late fee.
A credit card company might take the following actions if an individual with a credit score of 560 pays their credit card late once or twice:
1. Increase the APR: The credit card company may decide to increase the annual percentage rate (APR) charged on the credit card to a higher rate, potentially 24% or higher. This would result in higher interest charges on the outstanding balance.
2. Charge a late fee: The credit card company may impose a late fee for each late payment made. The amount of the late fee can vary depending on the terms and conditions of the credit card agreement.
3. Offer a lower APR to lower payments: In some cases, the credit card company may offer the individual a lower APR as a means to lower their monthly payments. However, this is not a guaranteed outcome and will depend on the credit card company's policies and the individual's overall financial situation.
4. Close the account: If the individual consistently pays their credit card late or fails to make payments, the credit card company may choose to close their account. This would result in the individual no longer being able to use the credit card.
5. Send the account to collections: If the individual repeatedly fails to make payments or becomes significantly delinquent, the credit card company may choose to send the account to a collections agency. This could potentially have a more severe impact on the individual's credit score and financial situation.
It is important to note that the specific actions taken by a credit card company may vary based on individual circumstances, the credit card company's policies, and the overall financial history of the individual in question.