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Remove a Credit Blemish: Write a Late Payment Removal Letter

An effective way to remove a late payment from your credit score is to write a late payment removal letter. Follow this guide to write one.

June 17, 2022

Are you in need of a mortgage? An auto loan? A home equity loan? If so, you’ll need to approach a lender, and that lender will likely look at your credit history. 

To get a loan, you’ll need a good credit report as well. One missed payment, and that loan may be tough to get. That’s because the late payment could leave a negative mark on your credit report for years to come. 

So, if you have a missed payment on your credit report, consider sending a late payment removal letter (aka goodwill letter) to your creditor.  

It may sound overwhelming, but it might delete that negative item from your credit report. We’ll help you get started by answering some questions you may have and guide you through the process of writing a goodwill letter. 

What is a late payment removal letter, and when might you use one?

Have you ever received a bill from a credit card company with a late fee slapped on it? It happens. Maybe you got laid off from your job, fell ill or paid the wrong card issuer by mistake. There could be many reasons why you missed your payment. But, if you have a positive payment history and relationship with the creditor, a late payment removal letter could help you get back on track. 

A late payment removal letter is a letter you send to your creditor to explain the reason behind your late payment and request a goodwill adjustment. Before you write a late payment removal letter, study your credit report carefully. You can get a copy from any of the three main credit bureaus

Creditors are required to report accurate information, but if any negative items on your credit report are questionable, you have the right — per the Fair Credit Reporting Act's (FCRA) Section 611 — to dispute it. In such a situation, instead of a goodwill letter, you’d write a dispute letter to your creditor. And if you feel you’ve been treated unfairly by any creditor you can approach the Consumer Financial Protection Bureau.

All that said, if you made a late payment and have a good reason, a goodwill letter may be a smart way to remove the negative mark from your record.

Other FAQs about late payments and removal letters

You probably still have lots of questions. The following FAQs and answers can help you better understand late payments and goodwill letters.

When are late payments reported?

Creditors usually report late payments to the credit bureaus — i.e., Experian, Equifax and TransUnion — when you're at least 30 days late on an account.

How do late payments impact your credit score?

Whether it's credit card, auto loan or mortgage payments, making on-time payments is important because your payment history makes up 35% of your FICO credit score. Your payment history indicates how reliable you are as a borrower, and lenders lean on your credit score to decide if they'll lend you money or give you credit.

One late payment could lower a 793 FICO Score by 63 to 83 points and a 669 score by 24 to 44 points. If you miss more than one payment, the impact on your credit score could be greater. A low credit score might mean you can't qualify for loans or credit cards. You could also have a hard time renting an apartment

Will a late payment stay on your credit report for a long time?

A late payment can stay on your credit report for up to seven years.

Can I pay off my debt to remove the late payment from my credit report?

It’s generally a good idea to pay off your debt, especially if your lender isn’t open to negotiating. That said, paying off your debt won’t remove the late payment from your credit report. 

If you want to pay off your debt and remove a negative mark from your credit report, you may have to go a different route and consider a pay-for-delete letter. Keep in mind, however, that this is usually only an option when a credit account is transferred to a collection agency. 

When should you write a late payment removal letter?

If you generally make on-time payments, send the letter as soon as you have a negative blemish from a late payment on your credit report.

Isn't it easier to call or email the creditor?

You may be able to access a link or get a phone number to contact your creditor. It may seem easier than taking the time to write a letter. However, if you want to remove a negative mark on your credit score and re-establish good standing, you're better off with a proper paper trail.  

How long will it be before you hear from the creditor? 

If you don’t hear from the creditor within a couple of weeks, it’s time to follow up. If they agree with your reasons, they may remove the mark from your credit report and your credit score could improve.

What if that late payment doesn't get removed?

If the late payment doesn’t get removed, keep trying. You may have to do this a few times. If you’re convinced the late payment won’t be removed, be prepared to have it remain there for seven years. 

If your credit score has been severely damaged by late payments, there are credit repair companies you could approach that claim they can remove negative marks from your credit report and help improve your credit score. Before using their services, it’s smart to do your due diligence.

How to write an effective late payment removal letter

The objective of a late payment removal letter is to have the creditor eliminate a negative mark from your credit report. Each letter is going to vary depending on circumstances. You can use a template or sample letter, but make it unique and address your specific situation. Try not to copy a sample goodwill letter verbatim.

Here's a framework you could follow when writing your late payment removal letter: 

[Your name]

[Your address]




[Creditor name and address] (Note: make sure you have the correct contact info.)

[Account number]


To whom it may concern,

Opening paragraph: Emphasize your relationship with the creditor. State how long you’ve been an account holder. If you’ve had a solid payment history, make mention of it here. 

Second paragraph: This is where you break down the details and facts about the negative mark. You can say that you noticed a late payment on your credit report. State the date and account name of the late payment. 

Third paragraph: Explain the reason for your missed payment. If you’ve experienced financial hardship or illness, don’t be afraid to say so. If you can prove the late payment wasn’t your fault, include all the relevant documentation.

Fourth paragraph (optional): If there are any other relevant points that can strengthen your case, it would make sense to add those here. For example, maybe you thought you scheduled a payment from your bank account through online banking before you left for vacation, but it turned out you didn’t. You may want to show proof that your vacation coincided with the due date of your payment.

Concluding paragraph: Take responsibility for your error and ask for a goodwill adjustment. Assure the creditor it won’t happen again. That might mean committing to set up a system for paying early or signing up for autopay.

Thank you for your time and consideration. 


[Your name]  


Restore your good standing

Certain life events can result in missed payments. If a late payment is impacting your credit score, be proactive by writing a late payment removal letter. It could help eliminate the negative item from your credit report.

A poor credit history from late payments can take a toll on your personal finances. If you struggle with keeping track of due dates for all your bills — such as student loans, credit accounts, auto loans, etc. — consider signing up for automatic payments offered by your financial institutions.

Another way to avoid late payments is to use the Tally† app for credit card management. Tally schedules credit card payments for you and can help you pay off higher-interest credit card debt more efficiently with a lower-interest line of credit.

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