Remove Late Payments From Your Credit Reports

Person pulling back on the hands of a clock
••• Alashi / Getty Images

Credit scores are designed to predict whether or not you’ll make payments on time, so it's not surprising that late payments in your past will drag down your scores. You’ll need to rebuild your credit by paying on time, and it might even be possible to get those late payments removed from your credit reports.

Accurate or a Mistake?

Late payments appear in your credit reports when lenders report that you paid late. That can happen in one of two ways:

  1. You actually paid late, and the lender is telling the truth.
  2. You never paid late, and the lender or credit bureau made a mistake adding the payment to your report.

If the report is accurate, it will be more difficult and time-consuming to get the payment removed from your reports — and it might not even be possible.

If the late payment is an error, it should be relatively easy to fix the error: file a dispute explaining that there’s a mistake, and demand that the payment be removed. Use a courier (like FedEx or UPS) or send the letter by USPS with a Return Receipt request. Lenders are required to correct errors, and failing to do so is a violation of the federal Fair Credit Reporting Act (FCRA). Fixing the error may take several weeks, but you may be able to accelerate the process using rapid rescoring. Paying for a faster fix typically only makes sense if you’re in the middle of a home purchase or another significant transaction.

How to Get Late Payments Removed

If the late payment is accurate, you can still ask lenders to remove the payment from your credit reports. They are not required to do so, but they may be willing to accommodate your request, especially if one or more of the following apply:

  1. You have a legitimate reason for paying late (hospitalization, disaster, bank errors).
  2. You can offer them something in return.
  3. You otherwise pay your bills on time (or you have been paying on time recently).

In addition to the factors above, you’ll get better results if you ask nicely. Remember that you’re asking another human being to help you with something that — technically — isn't required. This is a stressful and important situation for you, which makes it especially challenging, but your odds are always better if you can calmly explain your case and ask for some help.

Just ask: The simplest approach is to simply ask your lender to take the late payment off your credit report. That should remove the information from its source so that it won’t come back later. There are two ways to make this request:

  1. Call your lender on the phone and ask to have the payment deleted. The first person you talk with most likely will not be able to help you. Politely ask to escalate the issue and speak with a manager or a department that can approve your request. Once you have them on the phone, make your case politely.
  2. Write a letter and ask for a removal. Often known as a goodwill letter, these requests allow you to formally explain why the payment should be removed, and it’s easy to include proof that supports your case. The more proof, the better.

    Negotiate: You might also have success if you offer your lender something that they want. For example, if you’re behind on payments, you might propose paying everything you owe right away (possibly including penalty fees) in exchange for getting late payments removed. Alternatively, you could offer to set up automatic payments to ensure that payments arrive on time in the future. Get any agreements in writing before you send a large payment to your lender.

    Pay it off: Another simple option is to just get caught up (or pay off the debt you owe). However, the late payments in your credit history will remain for seven years, making it harder to get approved for the best loans and insurance rates. After that time, the payments will “fall off” your credit reports — they’ll no longer be shown to others, and they won’t be part of your credit score. If it’s the only option you have, it’s better to have a few late payments (that you eventually caught up with) than charge-offs.

    Get legal help: Some situations are so complex that you need professional help. A local attorney can review your case and offer guidance on additional options that may be available under federal and state laws.

    If You Don’t Succeed

    Try again: Your initial request may not be successful. That’s okay — ask several times because you might have more luck with a different person. Ultimately, you might not be able to get those payments removed, and you’ll just have to live with them.

    Rebuild your credit: Especially with late payments in your reports, you’ll need to put some work into rebuilding your credit. The most important thing you can do is to avoid additional late payments – get your payments in on time. Send them in a few days early, and sign up for electronic payments (at least for the minimum payment) to prevent problems. Adding new installment loans and repaying on time might also help, but only borrow if it makes sense to borrow — don’t do it just to try and game the credit system.

    Borrowing with bad credit: Your scores will be lower if those late payments stick around, but that doesn’t mean you can’t borrow. The key is to avoid predatory lenders (such as payday lenders) who charge high fees and interest rates.

    • FHA loans can provide funding to buy a home, even if you don’t have perfect credit. You can’t have any late payments within the last 12 months on your credit reports (24 months is better), but a few issues in the distant past should not derail your loan application.
    • Manual underwriting allows lenders to approve loans that wouldn’t otherwise get approved. Instead of having the application kicked out by a computer (because of late payments), you can have an actual person review your situation. Additional information, like extenuating circumstances and the fact that you pay your rent and utility bills on time, might make a difference and lead to approval.
    • A cosigner can help you get approved for auto loans and student loans. A cosigner applies for a loan with you and promises to make the payments if you fail to make payments on time. Lenders will look at the cosigner’s credit scores and income and evaluate the loan application based on your cosigner’s ability to repay the loan. For more details, see how cosigning works.

    Do Late Payments Matter?

    Your payment history is the most important piece of your FICO credit score, with a 35 percent weighting. Even if your credit reports are in good shape, one late payment can damage your credit, and those “lates” will stay in your credit reports for up to seven years unless you do something about them.

    Broad impact: Lenders evaluate your credit to approve or decline loan applications, but your credit also shows up in other areas. Strong credit can make it easier to get a job, buy affordable insurance, and rent a home or apartment.

    How many points? The impact of one late payment depends on several factors, including whether or not your lenders actually report late payments to credit bureaus.

    • How late? Payments less than 30 days late are unlikely to appear in your credit report. After that, payments get categorized (30 days, 60 days, 90 days, and so on, until the lender calls it a complete charge off). Paying 90 days late has a more severe impact than paying 30 days late. Paying a few days late might not affect your credit, but you will probably have to pay penalties to your lender, and you risk having your account closed.
    • How often? One or two late payments will certainly damage your credit, but the damage is limited if you avoid making a habit out of it. If you frequently pay late or you have late payments on multiple loans, the impact is greater.
    • How recent? A late payment has an immediate impact on your credit score because scores are designed to predict the future, and you’ve added new information to the scoring model. Still, it can be helpful to remove late payments that are several years old because any negative items in your credit will weigh down your scores.

    Equifax, one of the three major credit reporting agencies, that a consumer with good credit might see a 100-point drop the first time they pay 30 days late (the score falls from 780 to 680). If you already had a score of 680 and one or two late payments, your score might fall an additional 70 points if you add another 30-day late payment. Based on those numbers, deleting the payment that caused that 100-point drop is worth a few phone calls and letters.