How to get a late payment removed from your credit report

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If you have only one credit maxim at heart, it should be to always pay your bills on time.

A single late payment can bring down an excellent credit score (750 and over) by more than 100 points. It will stay on your credit report for the next seven years and it may be difficult for you to get loans or get an affordable interest rate.

But what if you make one honest mistake or have an emergency that affects your ability to pay? Depending on your relationship with the creditor, you may be able to have the late payment removed from your credit report. It’s not always possible, but it’s worth a try, especially if you’ve always paid on time in the past. Here are some steps you can take to improve your chances of erasing late payment from your credit report.

First steps

If you know you missed a payment, your first step should be to check your credit reports to see if your creditor reported it. It will only appear if it is at least 30 days overdue, and some accounts may not flag it unless it is at least 60 days overdue. If you’ve always paid your bill on time in the past, your creditor may give you the benefit of the doubt and not report the missed payment at all.

If you notice late payments on your report for accounts you don’t recognize, you could be a victim of identity theft. Place a fraud alert on your credit report and contact the credit bureau and financial institution immediately. This may take a few weeks to settle, but the credit bureaus are legally required to correct any errors on your credit report, so you shouldn’t have too much trouble getting these late payments removed.

Ask for a goodwill adjustment

If you’ve been a loyal customer for many years and this is your first late payment, your creditor may be willing to forgive your mistake and remove the late payment from your credit report. This is called a goodwill adjustment. You can contact the creditor by phone to request one, but you may have better luck writing a formal letter.

This letter gives you the opportunity to explain why your payment is late. If you have evidence that backs up your claims — a copy of a medical bill for an unforeseen expense, for example — it’s a good idea to include that as well. The more evidence you have that your missed payment was truly a one-time event, the more likely your creditor is to remove it. Send the letter by certified mail so that you know when the letter is delivered.

Whether you are requesting a goodwill adjustment over the phone or by mail, it is important to be polite. Remember that your creditor does not have to have to remove the late payment from your record if it is accurate, and they are less likely to do so if you come across as angry and combative.

To negotiate

If your creditor refuses to offer you a goodwill adjustment based solely on your payment history, you may need to offer the company something in return. If the debt is still outstanding, you can agree to pay off the entire balance at once. Or you can try offering to sign up for autopay to make sure you don’t miss any payments in the future. Be sure to get a written copy of any agreement you have with the lender so you can refer to it later.

If you’ve tried all of this and your creditor still won’t budge, you may just have to accept that the late payment will remain on your report. All you can do from there is make sure all your subsequent payments are made on time and do what you can to improve your credit score, including using less than 30% of your available credit and maintaining a good mix of credit accounts.

Over time, this late payment will affect your score less and less as your most recent payment history prevails, and after seven years it will be as if it never happened.

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