How to Get Late Payments Off of Your Credit Report
Your payment history is a big factor in most credit score models. Having even one late payment of 30 days or more can make a 720 credit score drop down to 670 overnight. Removing late payments from a credit report can cause your score to jump, but in order to do so, you have to take action yourself. If you do nothing, the payments will stay on record for between 5-7 years, with the deepest effect on your credit score coming in the first 24 months.
Removing Late Payments From Your Credit Report
There are a few different ways you can remove late payments, some fairly easy and some much more difficult. The first thing you need to do is take a look at your credit report to see what the status regarding the payment histories of your accounts. Heading over to AnnualCreditReport.com gets you a free copy of your credit report once a year from each of the three major credit bureaus.
If you’ve already taken your free credit reports for the year, you can get your credit report and credit score from Transunion for $1. You can also get your credit score for free at Credit Sesame or Credit Karma
Making a Phone Call
Assuming you do see a late payment on your credit report, the first step is to make a phone call to your creditor. In the case of credit card companies, most of the time they are more than willing to waive a late payment fee if you ask. In many cases, the waived fee reflects in their computer system as “not late”, resulting in the late payment being taken off your credit report the next time they update it. These updates usually occur once a month.
By getting the late fee waived, you save money since you don’t have to worry about a late fee anymore (which can range from $20-35) and the negative mark on your credit report is taken off. It’s possible to have multiple late fees waived if you were 60 or more days late on your payment, which can result in all of the “late” statuses being removed from your credit, or just leaving the least harmful one.
It only takes 5-10 minutes on the phone with a customer service representative, or you could use your credit card company’s online chat feature to do it while browsing the web.
Most of the time, just getting in touch with the credit card company or lender and asking for late fees to be waived or late statuses to be removed will be enough to do it. Here’s the caveat to this rule: You need contact them as soon as you can since the person on the other end of the phone/chat may only be able to remove fees or late payments back to a certain point. Calling one month after missing a payment will probably result in success, calling two years after it will probably not.
Financeography Tip: Checking your actual credit score through Credit Sesame is completely free and only takes about 3 minutes.
Writing a Goodwill Letter
Goodwill letters used to be a lot more popular with those trying to get late payments taken off of their credit reports. It does seem as though they do not seem to work very often, probably because everything regarding payments and reporting has become automatic.
It does not hurt to try writing a goodwill letter explaining your situation and you may get bonus points if you have been a long time customer, or if a few years have passed since the late payment. Depending on your state, the late mark is going to drop off of your credit report after five to seven years anyway, while the effect it has on your credit score declines significantly as the months pass by after the two year mark.
You might think about trying to write an email, but in this instance you’re going to want to put pen to paper to give it a personal touch. Mail the letter to someone in the accounts department, preferably with “ATTN: Manager” in the address line. Someone will read your letter and if you catch the right person on a good day, they may forward it to someone who can edit your late payments.
Asking for Verification
Failing a phone call and a goodwill letter, you can try to ask the credit bureaus to verify with the creditor that the account information is correct. Again, sending a letter through the mail (specifically certified mail) requesting that they open an investigation into the accounts in question is the way to go. The credit reporting agencies will have 30 days from the time they get your request to finish their investigation. Older accounts, especially if they have already been paid off, may not be in the database of some creditors any longer, leading them to falling off of your credit report since they cannot verify the activity.
Wait it Out
If all else fails, you may just need to wait the appropriate number of years until it fall off of your credit report on its own. Some areas have state-specific laws that mandate credit reporting agencies can report information for less time than the federal statute of 7 years. It might help to do a bit of research regarding these statutes, but even the shortest amount of time is five years. Over time, a late payment, or even several, will impact your credit score less and less as the statute of limitations on credit reporting gets closer.