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Delinquency
Also called past due, arrears.
Being behind on payments, tracked on conventional credit in 30-day aging buckets and on daily-remittance products from the first returned debit.
Drafted with AI assistance. Not yet independently checked. Nobody has verified the claims on this page against a source, so treat the figures and legal points as a starting point rather than as settled, and confirm anything you are about to act on. How we check things.
What it means
On monthly amortizing credit, delinquency is measured in buckets: 1 to 29 days, 30 to 59, 60 to 89, 90 plus. Reporting to commercial bureaus generally begins at the 30-day mark, and the buckets drive both the borrower's credit file and the lender's internal risk grading.
Daily and weekly products have no such runway. A returned ACH is the delinquency, and the return code tells the funder what happened: insufficient funds, account closed, or a stop payment placed by the customer. Each carries a different implication and a stop payment is treated as an intentional act rather than a cash flow problem.
What follows is fast: an NSF fee per attempt, re-presentment, a collections call within days, and in most agreements an event of default that has already technically occurred.
Where this one catches people
There are no 30-day buckets on an advance. One bounced debit is enough to constitute default under the agreement, whatever the funder chooses to do about it, and that unexercised right sits there for the rest of the relationship. It is the reason a funder can decline a reconciliation request and then accelerate the same week.
Where you will meet this term
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Delinquency — common questions
What does delinquency mean?
Being behind on payments, tracked on conventional credit in 30-day aging buckets and on daily-remittance products from the first returned debit.
Where does delinquency catch people out?
There are no 30-day buckets on an advance. One bounced debit is enough to constitute default under the agreement, whatever the funder chooses to do about it, and that unexercised right sits there for the rest of the relationship. It is the reason a funder can decline a reconciliation request and then accelerate the same week.
Is delinquency the same as an interest rate?
Delinquency is defined above; if you are comparing it against a rate, check whether the two measures share a time dimension before you put them side by side.
Which products does delinquency apply to?
Merchant Cash Advance, Working Capital, Term Loan, Equipment Financing.
Is there a worked example of delinquency?
Not on this entry. Where a term is arithmetic, the arithmetic is shown; this one is not primarily a calculation.
What else should I read alongside delinquency?
Aging report, Collections, Default, Event of default, NSF fee.
Has this definition been checked?
Not yet. This entry is drafted and live, and the notice at the top says so. Confirm anything you are about to act on.
Is this legal advice?
No. It is a definition. What a clause does in your contract, in your state, is a question for a lawyer licensed where you are.
Can I suggest a term?
Yes — [email protected]. The glossary grows from what people are actually shown in contracts.