Any credit that you have on your credit report that has been paid later than the due date will pull down your score. Bad payments remain in your credit history for as long as seven years. However, in some cases, you may be able to clear these negative marks earlier than the date that is mentioned above. Below are some guidelines on how to handle the process of contesting and deleting negative records such as the late payments from the credit files.
This means that you should request the creditor to delete goodwill as you will not benefit from it in the case of an asset sale.
The first step towards the process of disputing a late payment is to make a direct communication with the creditor or the debt collector to whom the payment was due.
Explain your situation and politely ask them if they would be willing to remove the late mark as a "goodwill deletion." Key things to highlight are:
- This was a one-time affair and, generally, you have been punctual in fulfilling the monthly payments.
- As you have mentioned you have been able to manage the finances well.
- The negative mark is taken to be significantly reducing your credit score, and hence, your financial freedom.
Stress the point that the same has happened and it will not happen again is what you should do. If it was due to some circumstances such as health complications or loss of job, ensure that you availed a doctor’s note or any other relevant recommendation. Creditors need to ensure that you will be effective in the future when they are likely to approach you again for more credit.
When appealing your case, do not be rude, and make sure to be slow in the process. Not talking to someone in a call center and instead talking to a supervisor or manager also increases your odds. Inform the creditor that you can pay all the outstanding balances as soon as possible to conform to this credit.
If the creditor agrees, make sure you get a written acknowledgment from the creditor to this effect that the late payment will be removed from your credit report. This is important so that the removal should take place.
Dispute the Late Payment
In cases where the original creditor does not accept your claim, the last option is to report the late payment as inaccurate to the three major credit bureaus: Equifax, Experian, and Trans Union. This can be done either through mail services or through the Internet.
If you are submitting your complaint, make sure to include details about the account and payment that are in question. Identify it as a “formal dispute notice” as required under the Federal regulations of the FCRA. Include a brief explanation and kindly ask for its response within 30 days or as provided by law.
The credit bureau will then follow up with the creditor that made the late payment report. If the creditor fails to verify the accuracy of the information in the file within the mandated time, the credit bureau is supposed to delete the negative mark from your report.
You can also provide documentation such as canceled checks or bank statements indicating that the appropriate amount was paid on time. Supplementary materials If you can provide proof that the late payment was incorrectly reported or has been already paid, it is advisable to attach them when filing the complaint.
Take Step 2: Write A Letter to the Credit Bureau To Request for Investigation of Inaccuracy
If you do not have concrete evidence which can directly disapprove the inaccuracy as illustrated above, there is a way out. According to the FCRA, any credit bureau that fails to fulfill the responsibilities as highlighted above has to investigate any error you claim after analyzing your report.
Send mail to the credit bureau stating that you have conducted your review of the credit report and the late payments are likely reported incorrectly or in error. Labor formally requests them to investigate under the obligations of federal law.
This initiates the credit bureau to engage in further processes of verification beyond simply contacting the creditor as the intermediary. Should their investigation fail to validate that the late payment is genuine, they are mandated to delete it from your credit history.
Negotiate Pay-for-Delete Agreement
If you still have payments that are still due, then you can make arrangements for the removal of the late payments in exchange for the payments of the amount you owe. What can be considered as a disadvantage is that this “pay for delete” means that the missed payments will not be included in the credit history any longer.
Negotiate with the creditor and offer to pay the remaining balance in full, upon which the creditor will cease reporting the late payments that they had reported to the credit bureaus. It seems some collectors may be willing to do this because most of them are interested in the recovery of debts.
To protect yourself from being stuck with a collection account indefinitely, try to obtain any pay-for-delete agreements in writing from the creditor before making payments. It is this letter that will help you make sure that none of the negative marks is given. If the creditor fails to delete as agreed upon, you can complain to credit agencies for failure to honor the contract.
Last Resort Options
If multiple attempts proving the inaccuracy of a late payment fail, there are still a few last-resort options that may work:
Compromise to pay – In this scenario, you propose to your creditor or debt collector a smaller amount that you owe him/her so that they drop the issue. It can be one of the measures when negotiating the removal of certain information from a credit report.
Hire a credit repair agency – there are legal ways to get those entries removed by registered credit repair agencies. Pricing considerations: It is crucial to avoid any services that charge upfront fees or guarantee their performance before a contract is signed.
Avoid the 7-year rule – In any credit report there is a regulation that states that after 7 years from the first time that one was reported to have made a delay on his payments, they should delete it.
Late payments = negative information for credit history Improving score – On-time payments, and low credit utilization will help to reduce the effect of previous late payments on credit score.
The best way to go about it is to ensure that if you start early and engage the credit agencies, you stand a good chance of having the late payments deleted before the seven-year reporting period elapses. This can start the process of rebuilding credit to get better loan rates and more opportunities for dealing with your money much sooner. Be persistent and use different approaches for the best chances of eliminating pests.
Call now for expert credit repair services: (888) 803-7889
Read More:
Can you pay someone to clear your credit?
Is there really a government debt relief program?
Is it worth doing a debt relief program?
How can I wipe my bad credit clean?
How to go from 650 to 700 credit score?
