How to Remove the Late Payments from Your Credit Report

Your payment history makes up 35% of the credit report. That’s the reason financial experts insist you to pay your debt in time.

What happens when you make a late payment? You pay a penalty for that. What else? Your credit score suffers.

Late payment myths

There are some myths around late payments, which I’m going to debunk here. One such myth is late payment doesn’t do that much of a damage on the credit score. Nothing can be further from the truth. Other than affecting your credit score, a late payment also stays on the report for years to come.

Another myth is it’s easy to remove a late payment from the credit history. The removal of a late payment from your credit report is not automatic. You need to approach the creditors and convince them to remove them.

In this article, I discuss some strategies, which you can follow to remove the late payments from your credit history.

Goodwill adjustment

I should throw a disclaimer statement right at the beginning. You can try this strategy, but there’s no guarantee that it’ll work. Goodwill letters are used to repair negative credit. Creditors often grant goodwill adjustments to borrowers if they find the borrower’s previous payment history satisfactory. You also need to build a good rapport with the creditor as that’ll amplify the odds of him granting you an adjustment.

It’s the easiest of all recommended strategies to have remove late payment records. The process is simple. All you need to do is send the creditor explaining the reasons for paying off the debt late. In the letter, mention that you paid late because of some compelling reasons, and it’s only an aberration, not a rule.

Negotiate with him

If you don’t have a good relationship with the lender, then you can try the second strategy; bringing the creditor on the negotiation table. In fact, many creditors are themselves willing to sit on the negotiation table if you buy their ideas. Creditors can remove late payments from the credit history, but in return, the borrower would have to sign up for automatic payments.

What happens when you sign up for it? Well, it serves both you and the creditor. You can rule out the possibility of late payment because the automated payment system doesn’t allow you miss a single payment. The payment is made every month either from your checking account or from your credit card. Click here to know more about the automatic payment system.

Dispute the late payment

This method is often seen as a desperate bid to clean up the credit report. Even though it’s a strategy, you need to apply it very cautiously, or else, you may find yourself inside the prison cell. You have every right to dispute a late payment in your credit history, but don’t lie.

Many entries on credit reports are inaccurate. The bureaus and the creditors enter the information as correctly as they could, but mistakes still occur. Such errors give you an excellent opportunity to steer clear your credit report from the late payments.

Look for errors, and if you can spot one, immediately dispute it. But don’t lie about errors because that’s a severe offense.

The charge-offs

Charge-offs are accounts, which are closed already. Consumers often think they can improve the credit score by making a payment to a charge-off. Not only they are wrong in thinking this, but by doing this, they can hurt their score.

How so?

A charge-off account is not current. But whenever you make a payment to that account, it becomes current. When you settle the old debt in that account, it stays on your credit report for next seven years as settled, and not paid. Any mention of settled accounts on your credit report can hurt your score. Hence, the best strategy would be keep charge-offs just as they are, and not making any payment toward them.

Wait patiently

Matters regarding your credit report are overly sensitive. If you couldn’t handle them properly, your credit score will invariably decline. That’s why, if none of the strategies discussed so far works, your best bet is to wait patiently. Many people hire professionals in the hope that they’ll fix everything. But it might do more harm than good because those people don’t have a magic wand in their hands.

What do you think of this article? Do you have late payments on your credit report? Would you follow these tips to remove them? Let us know in the comment section below