What Happens When You Miss One EMI? Real Impact Explained

Missing just one EMI payment damages your credit score permanently and costs you extra money. Banks charge late fees, report delays immediately, and increase future loan rates. Read this blog to learn how missing EMIs affect your finances.

1. Missed Once, Marked for Years

Missing one EMI can hit your credit score hard. Payment history forms 35 % of the score. Even a one‑day delay is reported as late. A recent report says a single missed EMI may drop your score by 50–100 points or more. This stain stays in the report for at least three years. 

Pay the missed EMI with any late fee immediately. Contact your lender and ask for a goodwill adjustment. Set auto‑pay or reminders to avoid repeats. Resume punctual payments to gradually rebuild credit.

Example:
 

Tushar’s score fell by 30 points in May. Two on‑time EMIs in June and July earned back 10 points. Consistent payments will heal his score over time.

2. One Missed EMI, Many Hidden Costs

Missed EMIs result in late fees, negative credit impact, and potential penalties from lenders. Missing an EMI leads to late payment fees, increased interest rates, and potential legal action. Banks apply additional charges on overdue amounts beyond the original EMI.

Read More – Missed EMI Could Destroy Your Credit
 

Your repayment history will show the default. This can hurt your future borrowing ability. It may trigger collection calls. Persistent delay could lead to legal action.

Here is an example:
 

Yogesh missed his ₹10,000 EMI. He paid ₹150 as a fee and ₹200 as overdue interest. He bore ₹350 extra. His CIBIL score dropped by about 60 points. He received reminder calls from the lender. Missing one EMI may seem small. But it adds cost and risk. Always pay on time.

3. Know Your Limit, Boost Your Loan Fit
 

Loan eligibility means how much you can borrow. Banks check your age, income, credit score, job stability, and existing debts. A good credit history makes approval more likely. They also use a rule: your EMIs should not exceed 40‑50 % of your income. That keeps repayments manageable. Higher income and lower debts increase eligibility.

Below is a detailed example of Harsh:
 

Harsh can take a loan where EMI ≤ ₹10,000. This means he can borrow more if his income rises. If Harsh clears his current EMI or raises his score, he can organise a more favourable loan.

4. Late Today, Costly Tomorrow

Future access to credit might become limited, or you could face higher interest rates. Missing payments affects your creditworthiness permanently. Missed payments now impact your credit score faster, making timely repayments crucial.

Over time, that small hike makes your loan more expensive. Your lender may also penalise you with late fees and report the delay to credit agencies. That can reduce your credit score slightly and push up future loan interest rates.

Example – Manish’s Home Loan Impact
 

In Manish’s case, one missed EMI means he pays ₹183 extra that month. Over the years, this accumulates. It also sends a bad signal to lenders. They may charge him higher rates next time. It is best to pay EMIs on time or speak to the bank if trouble arises.

5. Communication with Lender

If this is the first time you miss your EMI, your bank can provide you with a flexible repayment option. Banks initially send reminders through messages, emails, and calls. After 120 days, the bank can send a letter of demand asking for the balance amount in full. 

Also Read -   Impact of Late Payments on Your Credit Score
 

This can make future loans harder or costlier. Lender communication matters here. You should inform them quickly. They may offer a revised due date or help you work out a plan.

Example with Shivam:
 

In this case, Shivam missed a ₹10,000 EMI. He paid a ₹500 late fee and ₹200 interest. He now owes ₹10,700 instead of ₹10,000. His credit score fell a bit, too. These small effects can build up. Talk to your lender early. They can guide you on the next steps.

Conclusion

Missing one EMI hurts your credit score, adds fees, and raises interest costs. Always pay on time or talk to your lender quickly to avoid bigger problems. Stay on track with payments.

FAQs

1. What happens if I miss one EMI payment?

Your credit score drops, and you will pay late fees and extra interest.

2. Will my bank charge me for a late EMI?

Yes, banks add late fees (1-2%) and overdue interest.

3. Can missing one EMI affect future loans?

Yes, lenders may offer higher interest rates or reject your loan.

4. What should I do if I miss an EMI?

Pay it ASAP and tell your bank to avoid worse penalties.

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About the Author

LoansJagat Team

We are a team of writers, editors, and proofreaders with 15+ years of experience in the finance field. We are your personal finance gurus! But, we will explain everything in simplified language. Our aim is to make personal and business finance easier for you. While we help you upgrade your financial knowledge, why don't you read some of our blogs?