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Comment by _delirium | Hacker News Reader

This does seem somewhat unusual. Forcing auto-renewal upon customers (and providing no way to turn it off short of actually cancelling the account) is, alas, common, but most companies won't go so far as to turn the auto-renewal over to collections. They'll send you an email or two complaining, then cancel the account. I think all the times it's happened to me it's actually been stated like that in the emails pretty explicitly; something like, your credit card is no longer valid, please log in and provide new details within X days or your account will be canceled.

Does this kind of thing meaningfully damage your credit, though? I wouldn't think that someone sizing you up for something like a car loan would consider a $50 dispute over an annual fee to be a very good predictor of your creditworthiness.

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Problem is, it's usually not 'someone' sizing you up - it's an algorithm like a FICO score that gets spit back to anyone looking you up for credit considerations. When dealing face to face with someone reviewing a report for a score, they might take that in to consideration, but it's not always (or usually?) the case.

Hmm, yeah, I can buy that. If I were designing an algorithm, I think I would attempt to differentiate different types of disputes, so something like a dispute with Newsweek over a subscription renewal doesn't get much weight, while skipping credit-card or mortgage payments does. But maybe they've run the numbers and found that these small disputes actually are predictive of bigger defaults? Although, alternately, I could believe that the FICO folks don't care that much about predictive accuracy, since they're basically a monopoly with a good moat.

I missed a credit card payment a few months back. The reason? I didn't have direct debit set up on the bill, because I normally paid it in full manually before the bill date. Why manually? Because I actually overpay in order to increase the effective credit limit, since I'm new to the bank (moved to the UK fairly recently) and hence have a low limit. So, for the sake of a 50 GBP missed payment, I'll have that mark on my credit score for the next few years.

If you do it fast enough, the bank may remove the charge. They might not be able to easily remove the mark on your credit report now - but you won't know without asking. I've had my branch remove a couple of 'late payments' because they were truly just 'late' by a day or two, and generally just a bit of misplanning on my part. I can always move my money elsewhere, and they'll lose a decent customer for the sake of a $30 fine - they've removed the charges in both cases.

I don't know if it's unusual, but none of the credit cards I've had have even reported late payments that were only a few days late. Discussion on places like Fatwallet suggests that most companies report payments that are 30+ days late, with additional badness tiers at 60+ and 120+ days late.

It's interesting that you point that out, I'll probably contact my bank about it tomorrow.

This isn't the place for discussion of my personal credit record, but it may be interesting for someone. I had a charge of 237 GBP on 11th April (the one that pushed the balance into debit at all), and the bill on 12th April, with a due date of 11th May (according to the credit card website). The next payment was when I noticed (thought) it had been missed - but was on the 10th of May, 1000GBP pushing the account a few hundred back into credit (i.e. negative balance). So judging by what appears on their website, it was actually before the due date. Yet it showed up in a credit report (Experian's creditexpert.co.uk free trial)...

Discussion on places like Fatwallet suggests that most companies report payments that are 30+ days late, with additional badness tiers at 60+ and 120+ days late.

Yes. Also, credit reports focus on currently delinquent accounts -- a missed credit card payment a few years ago almost certainly won't show up if the account is currently not delinquent.

> Yes. Also, credit reports focus on currently delinquent accounts -- a missed credit card payment a few years ago almost certainly won't show up if the account is currently not delinquent.

This is absolutely untrue. Have you looked at a credit report before? There is a table in it that includes information about each month for the last few years (I believe seven); and each month is a whole column of information about each of the various accounts you have been paying to. It indicates whether there was no payment needed, payment on time, or, yes, a late payment. Even if the account is currently paid up.

Yes, I have looked at credit reports.

Don't assume that all credit reports are as detailed as the one that you saw.

The major 3 in the US - experian, transunion and equifax - all have that level of detail.

Definitely. Where I live (Toronto) credit reports used for most things only have information like: "missed a payment in the last 30/60/120 days -- yes/no" and that's it. Pls, as above, most banks wont actually bother reporting a 1-day late payment at all.

I don't have to. The burden of proof is on someone who claims that something "almost certainly won't show up", when in fact there are a lot of circumstances where it definitely will. I'll concede that you might need to look at more than one report to see evidence of this, but I maintain that the ggp is incorrect and I was right to call it "absolutely untrue".

If you were designing an algorithm, I assure you it would look nothing like FICO. It's very counterintuitive.

I remember writing an app that took a FICO score into account. It was pretty much a range - if your number fell below the range, rejected (or price increase). While the person using the system could see the qualitative reports, the whole thing was very much driven by your number.

I had this happen for a domain renewal at "1&1 Internet Inc.". The card expired and it failed to autorenew, except that A) I wasn't expecting an auto-renewal and B) no notification was ever sent from the company that the domain was expiring or that there was a billing issue. 6 months later the domain actually stopped working (with 6 months left on the registration, of course) and I got a collections notice for $40. I tried to reconcile with the registrar but they told me to pay up to the collector before they'd do anything, so I walked. No domain for 6 months until it expired. I check my credit yearly and have yet to see any mention of it. Of course the normal thing for domain registrars is to let it expire if no payment is received by the expiration date, but this company seems to be geared for web hosting and buddied up with an apparently shady collections agency.

It is actually very common for hosts to automatically renew and charge if you don't explicitly cancel the domain.

Customers get upset if their domain expires, someone snaps it up, and their widely publicized email addresses stop working. Getting a late payment notice is preferable.

Of course, if 1&1 never notified you there is no excuse for them sending you to a collection agency.

Still, every web hosting company that I've seen sells their packages as a recurring service.

If you want the service to not auto-renew then you need to explicitly cancel the service.

Bills sent to collections for as little as $15 can severely affect your credit score (personal experience). Since most car dealerships these days use the score as indicative of credit worthiness, even a small dispute can lead to annoying situations.

Well, if you're so hard up you can't afford 50 bucks, why should anyone lend to you?

(For the sarcasm-deaf downvoters out there, I'm pointing out the perspective of the algorithm reviewing the credit score, not stating my personal opinion.)

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