What Is a Delinquency on Your Credit Report, and Can You Remove It?

Managing your credit well can result in an excellent credit score and creditors practically throwing loans and credit cards at you. However, one delinquency on your credit report can stop all this and force you to jump through hoops for even the smallest of loans.

But what qualifies as a delinquent account and how does it impact your creditworthiness? We cover that, how to rebuild your credit and more below.

What is a delinquency on your credit report?

Simply put, a delinquency on your credit report is when a creditor has officially reported a late payment on your account to the three major credit bureaus — Experian®, Equifax® and TransUnion®. Every creditor has different standards for reporting your account as delinquent, but the following reporting schedule is standard practice.

1 to 29 days late

Depending on the company you’re dealing with, you could incur a late fee the moment you are one day late on the payment. However, some companies may offer a brief grace period before imposing any fees.

While you are technically delinquent on your account when you’re one day late with the payment, creditors cannot yet report the late payment to the credit bureaus. At this point, the creditor can call you to remind you of your payment and maybe even send you a letter reminding you of the payment and any late fees it will impose.

Despite incurring a late fee, as long as you make your payment before it reaches the 30-day mark after the due date, the creditor will report it as an on-time payment to the credit bureaus.

If you know you‘ll be late making your payment to your creditor, it‘s best to contact the company before it reaches a day past due. With early communication, the creditor may be able to accommodate the late payment by making a payment arrangement that avoids late fees, shifting your due date or moving this payment to the end of the loan term, allowing you to skip a payment.

30 to 59 days late

At the 30-day mark after the due date, most creditors can report the late payment to the credit bureaus. One key exception is a federal student loan, as the loan servicers cannot report a late payment until it reaches 90 days late.

When a creditor reports your 30-day-late payment to the credit bureau, you will get a late payment mark on your credit report. This mark will negatively impact your payment history, which makes up 35% of your FICO® Score. This makes it the most important factor in your FICO credit score, so this reported late payment can significantly lower your overall credit score.

Plus, for the next seven years, any creditor that runs a credit check will see this late payment. Fortunately, the late payment’s impact on your credit score diminishes over the years, as long as you remain on time from that point forward. In the immediate future, though, you may run into some trouble getting approved for financing. Some lenders — typically mortgage lenders — may even request a written statement explaining why you were 30 days late as a condition of approval.

60 to 89 days late

At the 60-day mark, things begin getting worse for you and your credit score. First, the lender will typically charge you an additional late fee and may even tack on collections fees. On top of that, the lender will hit your credit history with a 60-day late-payment mark.

A 60-day late-payment mark will have an even more significant impact on your credit score for the next seven years. You can also expect more phone calls and letters from the creditor demanding payment.

At this point, some lenders — particularly auto lenders — may repossess any collateral attached to the loan, such as a vehicle. In fact, auto lenders can repossess a vehicle once you’re a day late, though many wait 60 to 90 days.

90 to 119 days late

Once you reach the 90-day point, the creditor will likely hit you with another late-payment fee and other collections fees. Plus, you will get a 90-day late-payment strike on your credit report, which has an even more significant negative impact on your credit score.

This is also the point where federal student loan servicers can start reporting your missed payment to the credit bureaus. And this first mark will be a 90-day late-payment report, which can damage your credit score.

With a 90-day mark on your credit report, it’s doubtful the typical lender will approve you for any type of financing. You may qualify for high-interest-rate,bad-credit loans, but even those will be scarce at this point.

At the 90-day mark, most auto lenders will start the repossession process to mitigate their losses. In many states, an auto lender doesn’t need to warn you of the repossession — they can just show up and take the vehicle, unannounced.

A mortgage lender can‘t foreclose yet, but it‘ll likely send you a letter notifying you of its intent to begin the foreclosure process in 30 days unless you remit payment.

Your credit card accounts and other unsecured accounts will likely be permanently closed once you’re 90 days late. The creditors will also charge off the debt as uncollectible around this point and sell the unpaid debt to a third-party collection agency at a steep discount. The collection agency would then take over collections actions.

A repossession or charged-off account will add to your credit score woes, as these will negatively impact your FICO® Score. Plus, they will also remain on your credit report for seven years.

Keep in mind that until the repossession or charge-off occurs, you may still be able to contact your creditor and negotiate a payment plan to bring your account current.

120-plus days late

At 120 to 180 days delinquent, even the most patient lenders will charge off your debt, close your account and sell the debt to a third-party collection agency. Once this happens, there is nothing more you can do to bring the initial account back into good standing with the original creditor.

You can, however, negotiate a settlement with the debt collector. Since they generally buy these debts at a steep discount, they may be willing to accept less than you owe. Some may even accept a pay-for-delete offer, which means the collection agency will have the collection account removed from your credit history if you pay off the debt.

If the agency does not accept a pay-for-delete agreement, the collection account will remain on your credit report, albeit with a $0 balance, for seven years. Though lenders that pull your credit will view a paid collection account more favorably than an unpaid one, it will still hurt your credit score and possibly your chances of securing new financing.

Third-party debt collectors are notoriously aggressive in their collection tactics, but they are still bound by the Fair Debt Collection Practices Act (FDCPA) rules. This includes the fact that they must stop calling you if you request it in writing. Once you submit this no-contact letter, the collection agency can only contact you to let you know communications will cease or to alert you of any legal action it plans to take against you.

At the 120-day mark and with collections accounts on your credit history, there’s been significant damage to your creditworthiness. At this point, it will be virtually impossible to secure any financing other than some federal student loans.

Can you rebuild credit after a delinquency on your credit report?

Once you have a delinquency on your credit report, you will see a credit score reduction — in some cases, a severe score decrease — and the delinquency will remain on your report for up to seven years. This can make getting financing or approval for any other credit difficult. It can even impact your ability to rent a home or get utilities turned on in your name.

Fortunately, your credit report is not a permanent record, and you can restore your credit rating with time and effort.

First, the delinquency will no longer show on your credit report after seven years, which means it'll no longer affect your FICO® Score. In the meantime, you can rebuild your credit score with the following tactics:

• Keep all remaining accounts current: Try to maintain a good payment history on all your remaining credit accounts. If you have an open credit card in good standing, use up to 1% of its credit limit, then pay it off each month. This will show responsible credit usage and could help your credit score.

• Take out a secured credit card or credit-builder loan: You’ll likely have difficulty getting a personal loan or normal credit card with a delinquency, but there are credit-builder loans and secured credit cards that you may be able to qualify for. Use one or both of these to build a solid payment history and potentially improve your credit score.

• Negotiate with the collection agencies or creditor: If your account is already in collections, contact the collection agency and negotiate a payoff settlement, as a $0 balance collection account is easier for a potential lender to overlook than one with a balance. You may also be able to negotiate a pay-for-delete deal that settles the debt and removes the account from your credit report. If the original creditor still holds the debt, contact the company to see what options they have to bring the account current.

• Maintain good credit habits and wait: Now it’s just a timing thing. Continue maintaining good credit habits and responsible credit card use and monitoring your credit report. Slowly, you should start seeing your credit score improve — especially as the delinquency ages and good credit habits build. It will be a long process but a worthwhile one over time.

Can you remove delinquency from your credit report?

Generally, if a debt is legitimate, there is not much you can do to remove the delinquency. However, if you notice a delinquent debt on your credit report that you suspect may be identity theft or the creditor is incorrect in reporting it as delinquent, you can dispute it. Here’s how to dispute the delinquent debt with each credit bureau. Please note, it will take up to 30 days to get the dispute results.

Equifax

1. Navigate to Equifax’s dispute page and click “Get Started.” Create an Equifax account or click “Sign in here” if you already have an Equifax account.

2. Once signed up and logged in, click the “Dispute Center” text on the left of the page, then click “File a dispute.”

3. Click on the type of item you’d like to dispute. In the case of an illegitimate account or incorrect reporting, you'd click “Credit Accounts.”

4. Click on “View account details” on the account you wish to dispute, then click “File a dispute” at the bottom of the page.

5. Click the “Last reported account status and account information” radio button and click “Continue.”

6. Choose up to two statements that explain why you’re filing a dispute and add any additional comments in the box at the bottom of the page, then click “Continue.”

7. Upload any supporting documentation or click “Skip document upload.”

8. Click “Continue” to review the dispute.

9. Click “Submit” to officially file the dispute.

Experian

1. Navigate to Experian’s dispute homepage and click “Start a new dispute online.”

2. Complete the registration if needed. If you’re already a member, click “Already a member? Sign in” at the top of the page.

3. Once logged in, click the “Start a new dispute” button.

4. Scroll to find the account to dispute and click on the arrow to the right of it.

5. Click “Start a dispute,” choose the reason for the dispute, enter any additional information and click “Next.”

6. Review the dispute information, then click “Submit dispute.”

TransUnion

1. Navigate to TransUnion’s dispute homepage and click “Start Dispute.”

2. Log in to your TransUnion account or click “Create an account to start managing your TransUnion credit information“ to create a new account.

3. Once logged in, click on the “Start Request” button.

4. Click the acknowledgement checkbox, and then click “Agree & Get Started."

5. Scroll down until you find the account you’d like to dispute, then click “Dispute” next to it.

6. Click the “Yes” or “No” radio button indicating whether or not you disputed this item in the last 120 days, then click “Save & Continue.”

7. Click the radio buttons and checkboxes describing the reason for the dispute and enter any additional information in the ”Additional Comments” section, then click “Save & Continue.”

8. Click “Submit Dispute.”

Delinquency can damage your credit, but it’s not permanent

Delinquency on your credit report can significantly damage your credit score and your ability to get new credit. Fortunately, delinquencies are not permanent and disappear from your credit report in about seven years. Plus, you can rebuild your credit by using credit responsibly now and maintaining a positive payment history.

If credit card bills are piling up and putting you at risk of delinquency, the Tally†credit card repayment app may help. Our app helps you manage your credit card payments by offering a lower-interest personal line of credit, allowing you to efficiently pay off higher-interest credit cards. 

†To get the benefits of a Tally line of credit, you must qualify for and accept a Tally line of credit. The APR (which is the same as your interest rate) will be between 7.90% and 29.99% per year and will be based on your credit history. The APR will vary with the market based on the Prime Rate. Annual fees range from $0 to $300.