Remove Late Payments From Your Credit Report With a Goodwill Letter
Late payments can damage your credit, especially if you stop paying on loans or credit cards for an extended period of time. And while we usually tell you that there are no shortcuts when it comes to credit recovery, there are several legitimate steps you can take to improve your score faster. Let’s take a look at one of them: writing a goodwill letter.
What is a Goodwill Letter?
A business letter is an easy way to restore your credit’s good reputation by asking the lender or service provider to erase the late payment from your credit report. They can be effectively used for both federal and private loans, as well as credit cards and accounts at almost any financial institution.
You usually have a better chance of success with goodwill letters if you are facing financial difficulties due to unforeseen circumstances. The letter allows you to take responsibility for your actions and ask (in a very pleasant way) if your service staff can empathize with the situation that caused the delay and erase it from your report.
A business letter can also be helpful if you believe that a late payment was registered in error: for example, if you were on a deferred or deferred basis and were not required to make any payments at the time the late payment was recorded, or if you Know that you’ve never been late with a payment before.
What makes a goodwill letter persuasive?
If you’ve been looking for ways to make sure your goodwill letter really works, here are some tips on what you should include:
Grateful tone
It is important that the whole tone of your letter is grateful and conscientious. If you were actually late in payments, even due to extenuating circumstances, you should not take an angry tone in your letter, since you were deluded.
Sense of responsibility
You want to be convincing and honest. Take responsibility for the late payment and explain why it happened. Your creditor or creditor should be able to empathize with you. Saying that you just forgot will not earn you any points.
Good recent payment history
Aside from their liking, you want to gain the creditor’s confidence that you can continue to make payments. If they see payments being made on time before and after a period of financial hardship, they may be more willing to give you a break. If you’re in the habit of making late payments, it’s harder to convince them that you are taking it seriously.
Confirmation of any errors and related documents
If you write about an error that has occurred, be polite and document the errors you find. You will need proof that you are telling the truth. Unfortunately, mistakes in your credit report are not uncommon and a technical error could easily have occurred on the part of your service staff. If you have written correspondence with them, you can include it.
Keep in mind that credit bureaus usually have the ability to flag inconsistencies and potential errors right from your report when you open it online, so you may not even need to write a formal letter to dispute the error.
Brevity
The last thing to remember is that a short and simple letter will be more effective. Get straight to the point as you tell your story. People viewing your letter do not want to read your essay; the easier you make their life, the better your chances of a favorable outcome.
Samples of goodwill letters
Below is a sample goodwill letter for a student loan:
To whom It May Concern,
Thank you for taking the time to read this letter. I just pulled out my credit report and found that a late payment was recorded on [date] for my account [loan account number].
During this time, my mother became terminally ill, and I was the only one left to take care of her. So I had to quit my job and my savings went to her medical expenses. After she passed away, I had a very difficult time and I could not pay on the student loan.
I realize I made a mistake lagging behind, but up to this point, my payment history with you has been flawless. When I was able to find work again, I quickly resumed paying off my student loans, making them a priority.
I am not proud of this negative mark on my track record, but it is the only one I have, and I would be extremely grateful if you would comply with this request in order to remove the delay from my credit report. It would help me a lot in securing other lines of credit so that I can further improve my credit rating.
If the lateness cannot be eliminated entirely, I would appreciate it if you could make adjustments to the goodwill.
Thank you.
If you are writing an email because the delay shown on your credit report is inaccurate, try this template:
To whom It May Concern,
Thank you for taking the time to read this letter. I recently pulled out my credit report and found that [Loan Service Personnel] had reported a late payment on my account [Loan Account Number].
Please evaluate the accuracy of this late payment.
I believe this message is incorrect because [list the supporting facts that you have]. I have attached documentation confirming that I was making payments at this time / that my loans were deferred / deferred and did not require any payments.
Please do your research and if it turns out to be inaccurate, remove the delay from my credit report.
Thank you.
Make sure you tailor the letter to your situation; you want to provide as much personal information as possible. You should also include your name, address and telephone number at the top of the letter in case your loan agent needs to contact you immediately.
Documents to be attached to a letter of goodwill
Don’t let your efforts go to waste if you remember to attach the documentation to the letter. Here’s a quick checklist of what you should include:
- Account number for your loan.
- Your name, mailing address, telephone number and email address.
- Statements proving that you paid (if you dispute late payment).
- Documentation confirming that you paid on time in all other cases, except when you are having financial difficulties.
- Identification documentation so that your service center knows that you have made a request.
- It is not necessary to “include” anything, but if you are mailing something you should send it by certified mail so that you have proof that your letter was delivered to its destination.
Where to send a letter of goodwill
Now that your letter is written, you must send it! You can do this from your online account with the lender using a secure message, but you can also send a copy by mail. Find the best mailing address on your most recent account statement or on your lender’s or lender’s “contact us” web page.
It is important to note that goodwill letters do not guarantee immediate results. It often takes several attempts to correspond with service organizations and creditors in order for them to confirm that they received a letter from you.
If all else fails, try as many different communication methods as possible: call, write, chat, and email them. Several people who have tried this method report that it can tire your maintenance staff with a flood of requests.
This post was originally published in 2015 and was updated by Lisa Rowan on April 7, 2020. Updates include the following: Verified and updated links for accuracy; function image changed; concise consultation on mailing addresses; updated formatting to reflect the current style; rewrote the first paragraph. This post was originally published on Magnify Money.