Remove late payments by paying your bill on time!

While those in the Fix Your Credit Consulting community probably already know this, it bears repeating: Pay. Your. Bills. On. Time.

If you have a credit card, you already know that being late on a payment can cause you to incur late fees that can grow exponentially with every delinquency. Additionally, for a lot of credit cards that offer rewards programs, you can become ineligible for their benefits if you are late on a payment. Some creditors may even increase your interest rate if you are consistently late, which means paying even more on your already overdue credit card bill!

In addition to direct penalties from your credit card company, a late payment will most likely be reported to the credit bureaus and negatively impact your credit score. Most people do not realize that payment history accounts for 35% of your total credit score, meaning late payments can have a huge impact on your financial future. So the on time payments you make today will help you buy a car with a good interest rate in two years time. As if that wasn’t enough, a late payment can stay on your credit report for seven years after the original delinquency date. However, recent missed payments have a greater effect on your credit score than older ones, so over time the impact of a late payment will fade–just be sure not to incur any additional late payments!

But it is important to remember that none of us are perfect. No matter how good our record is, we are bound to miss a payment on a credit card one day, even if it is due to reasons beyond our control. Because of this inevitably, it is all the more important to practice consistently paying your credit on time when you can control it–if you do, you may be able to get your late payment removed!

The process of removing a late payment is known as requesting a “goodwill adjustment” from your creditor. To do so, you must call or write them a letter explaining why exactly you were late with your payment and request that they forgive your transgression. In these situations it can help to be as explicit as possible and delve into what situational factors might have led to you being late. For example, if there was some recent change to your life that caused you to forget the payment date or not have enough to pay the minimum at the time, such as a surprise hospital bill, a divorce, or a new child, you should definitely include that in your letter. This helps to assure them that this was an anomaly and not indicative of your habits as a borrower. While there is no guarantee that your creditor will grant you forgiveness, your chances go up drastically if you have a long, established history of paying on time.

If you do not know where to start, you can find many goodwill adjustment letter templates online to aid you in crafting your own letter. But do your research and compare the available options. Sending multiple letters of varying styles over a short period of time is a good way to annoy your lender and could make your chances go down. You want to make sure you are sending the best possible letter you can the first time, and if for some reason you feel the need to send another one in regards to the same late payment, it could benefit you to wait awhile between attempts.

If you have any questions about removing late payments from your credit history or other ways you can improve your credit score, call us at (877) 212-2450 or Contact us by email for a free consultation! 

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