Goodwill Letters: Late Payment Removal From Your Credit Report | Bankrate (2024)

Have you ever missed a loan or credit card payment deadline? If so, you know the repercussions. Besides incurring late fees and higher interest rates, payments delayed by over 30 days can harm your credit score.

But there’s good news: a late payment doesn’t have to haunt you forever. You might be able to turn things around with a goodwill letter.

While a goodwill letter won’t get you a refund on late fees or better terms from your lender, it might help tidy up your credit report and boost your score.

What is a goodwill letter?

A goodwill letter is a formal letter to a creditor or lender, such as a bank or credit card company, to request forgiveness for a late payment or other negative item on your credit report.

In the letter, you typically:

  • Explain the circ*mstances that led to the late payment or issue
  • Express remorse and your intention to pay on time going forward
  • Request that the creditor consider removing or adjusting the negative item

The lender may then decide to make the requested changes to your account as a gesture of goodwill.

While there’s no guarantee of success, a well-written goodwill letter can persuade a creditor to make a positive adjustment to your account, which can help clean up a negative mark on your credit report.

When should you write a goodwill letter?

Consider writing a goodwill letter when you’ve had a late payment or other negative item reported on your credit report due to circ*mstances beyond your control. Suitable situations might include a temporary financial hardship, medical emergency or personal crisis.

It’s crucial to ensure that the late payment or issue was a one-time occurrence and not a recurring problem. Also, only proceed with a goodwill letter if you plan to maintain good financial habits going forward. Writing one can be beneficial when you believe your situation deserves understanding and you’re committed to repairing your credit history and boosting your credit score.

Keep in mind that many lenders offer financial hardship programs that can help get you through difficult times. Most lenders prefer that you leverage these programs right away rather than ask for forgiveness later.

Ultimately, if the late payment in question is part of a pattern of irresponsible financial behavior, a goodwill letter may not convince the creditor to make adjustments to your account.

How do you write an effective goodwill letter?

Writing a formal letter, like dressing formally in a courtroom, can show your lender that you take your late payment seriously. It shows respect for the process and a willingness to act professionally, which can work in your favor.

An effective goodwill letter requires the following:

  1. Address the creditor or lender respectfully and thank them for their time.
  2. Clearly explain the situation that led to the late payment with relevant details and/or documentation to support your explanation.
  3. Own up to the mistake without excuses. Acknowledge any errors and express genuine remorse for any inconvenience caused.
  4. If applicable, emphasize your good payment history with the creditor. Mention previous instances of on-time payments or your long-standing relationship with them.
  5. Reassure the creditor that the late payment was a one-time occurrence and not typical of your financial behavior. Explain any steps you’ve taken to prevent future issues.
  6. Clearly state what you’re asking for, whether it’s the removal of the negative item from your credit report, a late fee waiver or another form of leniency.
  7. Thank them for their time and express hope for a positive resolution.

Before sending your letter, carefully review it for clarity, accuracy and professionalism. Make any necessary revisions to ensure your message is clear and persuasive.

By crafting a well-written goodwill letter, you can increase your chances of a positive outcome and potentially improve your credit situation.

What to include in a goodwill letter

When writing a goodwill letter, consider following this template:

Header

[Your Name][Your Address][City, State, Zip][Phone Number][Email Address]

[Date]

Recipient’s information

[Creditor/Lender’s Name][Creditor/Lender’s Address]

Dear [Creditor/Lender’s Name],

I am writing to address a recent late payment on my account with [Creditor/Lender’s Name].

[Explain the circ*mstances that led to the late payment or negative item on your credit report. Be honest and provide relevant details. Note any documentation you can enclose.]

I take full responsibility for the late payment. [Acknowledge any mistakes made and express genuine remorse for any inconvenience caused.]

Despite this incident, I have maintained a positive payment history with [Creditor/Lender’s Name]. [Highlight any previous instances of on-time payments or your long-standing relationship with the creditor.]

I assure you that this late payment was an isolated incident. [Reassure the creditor that the late payment was not typical of your financial behavior and explain any steps taken to prevent future issues.]

I kindly request [specific action, such as the removal of the negative item from your credit report, a waiver of late fees or another form of leniency].

Thank you for taking the time to consider my request. I appreciate your understanding and cooperation in this matter.

Sincerely,

[Your signature]

Also, list any additional documents included with the goodwill letter, such as proof of payment or hardship letters.

How do you send a goodwill letter?

Once your letter is ready, address the envelope by writing the creditor’s name and address on the front and your own name and address as the return address.

After that, attach the necessary postage to the envelope. Then, simply send the letter by dropping it in a mailbox or taking it to the post office.

If you want proof of delivery, consider sending the letter via certified mail. You will pay a little extra for this option, but it can be worthwhile to keep detailed records.

Finally, after sending the letter, you may want to follow up with the creditor to ensure they received it and inquire about its status.

What expectations should you have when sending a goodwill letter?

Checking your expectations with a goodwill letter is vital to avoid disappointment. Remember, a goodwill letter is a request for leniency, not a guaranteed solution. Knowing this helps in managing your expectations from the outset.

Additionally, it’s crucial to evaluate the circ*mstances surrounding your late payment or negative item. Assess whether it was an isolated incident due to a legitimate hardship or part of a recurring pattern. Researching the creditor’s policies regarding late payments and goodwill adjustments can also provide insight into the likelihood of success.

When crafting your goodwill letter, be realistic about what you’re asking for and understand that the creditor may choose not to grant your request. Patience is also key — it may take time for the creditor to review and respond to your letter, so don’t expect an immediate resolution.

Have alternatives in mind, such as:

  • Credit counseling
  • Debt settlement
  • Dispute with the bureaus
  • Credit repair services

A backup plan can help manage expectations in case your goodwill letter doesn’t yield the desired outcome.

Finally, maintaining a positive outlook throughout the process, regardless of the outcome, can help you navigate the situation with resilience and determination.

What do you do if you never made a late payment?

If you’ve always made timely payments but see a late payment on your credit report, you should take a different course of action.

In this case, you can reach out to the creditor to address the inaccuracy. If the creditor finds that they misreported the late payment, you can request that they report the error to the credit bureaus.

If this doesn’t work or as an alternative, you can dispute the misreported payment with the bureaus. You will want to dispute with the three major credit bureaus, Transunion, Experian and Equifax. Each credit bureau has options for convenient online disputes.

Next steps

Goodwill letters can be an effective tool to tackle late payments on your credit report. It’s all about understanding what these letters are for, crafting them carefully and keeping your expectations realistic.

If you missed a payment, take a look at your situation to figure out if a goodwill letter is the right move. If so, get to work crafting a solid letter and send it off to your creditor.

If a goodwill letter doesn’t do the trick, you have some backup options. In some cases, counseling, settlement or a dispute with the bureaus could be a better way to go. Take it step by step, stay patient and remember — you can control your credit, one letter at a time.

Frequently asked questions

  • It varies. A well-written goodwill letter can often persuade a creditor to help, but there’s no guarantee.

  • No, lenders are not required to reply to goodwill letters. Whether or not you get a response depends on the lender’s policies and is done at their discretion.

  • People write goodwill letters to explain late payments due to financial hardship, emergencies or crises, asking for understanding from the creditor.

Goodwill Letters: Late Payment Removal From Your Credit Report | Bankrate (2024)

FAQs

Goodwill Letters: Late Payment Removal From Your Credit Report | Bankrate? ›

Even one late payment can negatively impact your credit score and make it harder to qualify for future loans and secure good interest rates. If you have a good record of managing your finances, some creditors may remove the late payment from your report if you write a goodwill letter.

Can a goodwill letter remove late payments? ›

Even one late payment can negatively impact your credit score and make it harder to qualify for future loans and secure good interest rates. If you have a good record of managing your finances, some creditors may remove the late payment from your report if you write a goodwill letter.

How successful are goodwill letters? ›

There's no guarantee that a goodwill letter will work, and there's no officially approved formula to follow in order to give yourself the best chance of success. Keep in mind that because creditors aren't required to consider your request, you may get no response at all.

Do credit bureaus accept goodwill letters? ›

But a well-written goodwill letter could persuade them to make goodwill adjustments or to report that you are in good standing to the credit bureaus—Experian, Equifax, and TransUnion—that keep track of your credit history.

How do you convince a creditor to remove late payments? ›

Missed a Payment? Try Writing a Goodwill Letter to Remove It From Credit Reports. A goodwill letter explains why you had a late payment and asks the creditor to take it off your credit reports.

What is a 609 letter to remove late payments? ›

Section 609 gives consumers the right to request information related to debts listed on their credit reports. Examples of information that you may want to dispute include: Accounts opened due to identity theft. Late payments that were paid on time.

How to clear late payment from credit report? ›

The process is easy: simply write a letter to your creditor explaining why you paid late. Ask them to forgive the late payment and assure them it won't happen again. If they do agree to forgive the late payment, your creditor should adjust your credit report accordingly.

How to remove negative items from a credit report? ›

How to remove negative items from your credit report yourself
  1. Get a free copy of your credit report. ...
  2. File a dispute with the credit reporting agency. ...
  3. File a dispute directly with the creditor. ...
  4. Review the claim results. ...
  5. Hire a credit repair service. ...
  6. Send a request for “goodwill deletion” ...
  7. Work with a credit counseling agency.
Mar 19, 2024

How long do creditors have to respond to a Goodwill letter? ›

The creditor has no obligation to honor or even respond to a goodwill letter. Write a goodwill letter as you would for any business-related correspondence—keep it professional, clear and concise. Take the necessary steps to avoid incurring negative items in the future.

What is a good reason for a late payment letter? ›

Top 12 Excuses For Late Payment
  • Sorry! We forgot to make the payment. ...
  • We are facing issues with your order. ...
  • We have already paid the invoice. ...
  • The cheque has been sent. ...
  • The person responsible for payment has a family emergency. ...
  • We are switching to a new bank. ...
  • We're experiencing cash flow problems. ...
  • Claimed bankruptcy.

What is a letter of forgiveness for a late payment? ›

A goodwill letter is a formal letter to a creditor or lender, such as a bank or credit card company, to request forgiveness for a late payment or other negative item on your credit report. In the letter, you typically: Explain the circ*mstances that led to the late payment or issue.

Do goodwill deletions work? ›

Do goodwill letters work? Your lender is not obligated to honor your goodwill adjustment request or help remove negative marks from your credit report. “It's likely they could say yes; it's likely they could say no, and I think there's an equal chance of either response,” McClary said.

Can I ask for goodwill deletion with debt collectors? ›

3. If you already paid the debt: Ask for a goodwill deletion. You can ask the creditor — either the original creditor or a debt collector — for what's called a “goodwill deletion.”

How to write a goodwill letter to remove late payments? ›

An effective goodwill letter should have the following components:
  1. Personal Information and Contact Details. ...
  2. Account Information. ...
  3. Explanation of Late Payment Circ*mstances. ...
  4. Request for Late Payment Removal. ...
  5. Express Gratitude and Commitment to Timely Payments.

Will my credit score go up if late payments are removed? ›

Late payments can remain on your credit report for 7 years. Still, one late payment isn't likely to reflect poorly on your creditworthiness permanently, as long as you generally make payments on time. And assuming good credit behavior, your credit score should rebound from a single late payment over time.

Does Chase accept goodwill letters? ›

The information we report is required to be complete and accurate. Because of this, we don't make goodwill or courtesy credit report adjustments. We understand that you may be concerned about the potential impact of a late payment.

Can you get a company to remove a late payment? ›

You can't remove a correctly reported late payment from a credit report. And according to the CFPB, you can't pay a company to do it for you either. So if you see companies offering to remove accurately reported late payments and other negative information from your credit reports, don't buy it.

Can I ask my mortgage company to remove late payments? ›

If a late payment has appeared on your file in error, you can contact the company you have the account with and ask for it to be removed. If you provide a good reason for paying late and have since paid in full, they may remove it for you.

Can a goodwill letter remove a charge off? ›

You can write a goodwill letter to the creditor asking them to remove the charge-off from your credit report. Explain your situation and why they should make an exception for you. You'll have more luck if you have a longstanding relationship with the original creditor or have other accounts with them.

Top Articles
Latest Posts
Article information

Author: Melvina Ondricka

Last Updated:

Views: 5785

Rating: 4.8 / 5 (48 voted)

Reviews: 87% of readers found this page helpful

Author information

Name: Melvina Ondricka

Birthday: 2000-12-23

Address: Suite 382 139 Shaniqua Locks, Paulaborough, UT 90498

Phone: +636383657021

Job: Dynamic Government Specialist

Hobby: Kite flying, Watching movies, Knitting, Model building, Reading, Wood carving, Paintball

Introduction: My name is Melvina Ondricka, I am a helpful, fancy, friendly, innocent, outstanding, courageous, thoughtful person who loves writing and wants to share my knowledge and understanding with you.