Your payment history is one of the most important credit scoring factors. Having a long history of paying different types of accounts on time can help you build excellent credit, while missing payments can hurt your credit.
If late payments are hurting your scores, removing late payments from your credit reports may be an option. For example, if a creditor reported you late when you paid on time, you can file a dispute with the credit bureau to get your credit report corrected.
The first step in figuring out how to remove a late payment from a credit report is to review your credit report and now what should—and shouldn’t—be there.
First, closely look over your credit reports for late payments.
You can get a free copy of each of your credit reports from Equifax, Experian, and TransUnion at annualcreditreport.com at least once every 12 months. You may also be able to get more regular, free access by creating an account on the credit bureau’s website or signing up for a service like Credit Karma.
Here’s a guide to reading your credit report —the late payments will be within the accounts section. You may see an indication of how late the payment was (such as 30 or 60 days late), and sometimes the box could be colored yellow, orange, or red instead of green. However, the look and marks will depend on where you get your credit report.
Look for any obvious mistakes, such as incorrectly reported late payments. But also look for minor details that may be off. For example, you might remember missing a payment years ago but aren’t sure when it happened. If two credit reports show a late payment in May 2013 and the third one shows a late payment in June 2013, there’s a clear discrepancy and something needs to be corrected.
You’ll also want to know what’s allowed to be on your credit reports so you can identify when something is amiss. According to the FCRA, a late payment can stay on your credit report for seven years. Even if you close an account or pay the past-due amount, the credit bureau doesn’t have to remove the late payment.
However, the credit reporting system only allows creditors to report you as late once you’re at least 30 days past a bill’s due date. If you miss a payment be one to 29 days, you may wind up with late payment fees or extra charges, but you shouldn’t be reported late if you bring the account current.
The timeline can also get a little confusing depending on the circumstances. If you’re late on a payment and then bring your account current, the late payment falls off after seven years.
But if you never bring the account current, it will go into default, be closed and charged-off. When that happens, the entire series of negative marks (i.e., all the late payments and even an associated collection account) may be removed seven years after that first late payment.
As your payment history is one of the most important credit scoring factors, even a single late payment can have a big impact on your credit scores. The number of points your score will drop will depend on your overall credit profile.
If you had excellent credit, you might see a big drop in your scores after a single late payment. Your score may continue to drop as you fall 60, 90, 120, etc. days behind.
But those who already have poor credit might not see as much of an impact from one additional late payment because it’s not necessarily a major change in their behavior. The previously low credit score may have already calculated in that they were likely to fall behind on a payment in the future.
As mentioned above, missing your due date won’t immediately result in a late payment showing up on your credit report. Additionally, some creditors don’t report accounts and payment activity to the credit bureaus.
For example, a credit card issuer might only report to one or two credit bureaus. A late payment will only show up on the credit reports from the bureaus the creditor sends information to. However, that also means your on-time payments don’t help you build credit with the third bureau because the creditor doesn’t send it any information.
Most major credit card issuers and lenders report to all three bureaus. But some subprime lenders and non-traditional creditors (such as utility or cellphone carriers) don’t report to any or all three major bureaus.
Even if the late payments don’t get reported, if you fall far enough behind, your account could be sent to collections. The collection agency can separately report your collection account to the bureaus, which can hurt your credit.
An accurate late payment can stay on your credit report for up to seven years. However, there are some situations when a creditor or debt collector will agree to tell the credit bureaus to no longer report a late payment.
A goodwill letter is when you reach out to the creditor, explain the circumstances that led to your late payment, and ask it to remove the late payment from your record. It’s not guaranteed to work, and your success can depend on your reasons, the creditor, and your approach.
Searching in forums, you can find people who claim they successfully used goodwill letters to remove late payments. However, they often reach out to multiple people at the organization with letters, phone calls, and emails. Some even go as far as sending direct messages to managers and executives at the company through social media.
Politeness and persistence can help, but creditors don’t have to change something if you were late on a payment. They may even be under a contractual obligation to report accurate information to the bureaus, and there are plenty of anecdotal stories of the goodwill letter method yielding no changes.
You may have heard of a pay-for-delete, in which you pay a past-due amount in exchange for the creditor asking the credit bureaus to delete negative information. While pay-for-delete can sometimes work, it’s often only an option when you’re dealing with a debt collector and collection account. Even if you can get the collection account removed, the original account and the late payments can remain on your credit report.
The most straightforward way to remove a late payment from a credit report is to identify an error within the reporting file a dispute. You can send a dispute to the credit bureaus by mail, fax, or phone, but the easier method is online.
Here are links to each of the bureaus’ dispute centers, where you can start the process online or find the credit bureaus’ contact information if you want to file a dispute another way: Equifax, Experian, and TransUnion.
If you’re unsure of how to best go about reviewing your credit report for inaccuracies and filing disputes—or you’d like to outsource some of the work—you can work with a credit repair professional.
Credit Saint is based in New Jersey, has over 15 years of experience, and an A rating from the Better Business Bureau. The trained credit counselors at Credit Saint have experience negotiating with creditors and closely reviewing credit reports for fine-point errors that a general consumer might miss.
They can also advise you on the best ways to actively build your credit, which can be equally important if you’re looking to improve your overall creditworthiness and increase your credit scores. And, Credit Saint offers a 90-day money back warranty to all customers.