Late pays can be a sticky topic when it comes to credit reporting.
Some creditors have, in the past, been known to hold payments received on time until past the due date. While this practice may not be as common in today's credit world, it still does happen. When it does happen, more often than not it is unintentional.
But it can still hurt your credit.
If the only late pays you have are one or two late pays that you didn't know about prior to checking your reports, chances are something went wrong on the creditor's end and there was a delay in getting the payment applied to your account. It could have also been a mail issue. Most of the time the post office is reliable, but every now and then something gets lost.
One our staff once received a credit card payment that someone had mailed to their credit card company. It was caught in the fold of a self-mailer, and showed up in the mail one day. In that case, they looked up the person's name and phone number by the return address on the envelope and called them to let them know what had happened so that hey could make other arrangements to get the bill paid.
Most of us won't be that lucky though, and when things get messed up in this manner, we're stuck with a late payment on our credit report.
Most creditors will remove isolated late payments as a matter of good customer service and "good will".
Getting these types of late payments removed is usually a matter of sending what is known as a "Goodwill Request Letter" to the creditor and asking them to remove the late payment.
(See our article on Removing Late Payments With Goodwill Requests for more information on this approach.)
What if the late payment wasn't an isolated incident? What if you were out of work and fell behind, or otherwise ran into trouble in which your payment history suffered.
There are still several options for removing the late payments.
These may include…
* Settling the outstanding debt with the creditor, and including the removal of the late payments as part of the settlement agreement.
* Factually disputing the late payments themselves based on errors in the credit reporting.
* Using an approach similar to the goodwill request, but with more documentation and justification, and offering concessions of your own such as getting on an automatic payment option to avoid future late payments.
It is not uncommon for credit history to be included in the negotiations for settling outstanding debts. This is a perfectly legal and ethical approach if you're struggling and need options to clean up your credit and get your finances under control.
If there are errors in the credit report listing, such as late pays being listed after the closing date, or undated late pays, then those can be disputed as being incorrect or incomplete (whichever is appropriate). According to the FCRA any item found to be inaccurate, incomplete, or unverifiable should be deleted.
If there was some legitimate unforeseen hardship that resulted in multiple late pays, you could use a variation of the Goodwill Request letter to attempt to get the late pays removed.
Perhaps you were hospitalized due to illness or injured in a car accident… it's possible in those circumstances that if you show documentation of your hardship and make some effort to make things right and prevent future occurrences, you might be able to get the late pays removed.
For this approach it will probably take more than a simple letter or phone calls. You may need to contact the company several times, and perhaps even use outside help like the BBB to try and get your message to the right person in the company.
If you are unable to remove all of your late pays from your credit report, remember that the older they get, the less damaging they will be. You can also take steps to add positive accounts and otherwise improve your credit history to offset the effects of the late payments.