Your creditor may be willing to remove late payment marks from your credit report if requested.
Late payments can stay on your credit reports for seven years, hurting your credit health and making it harder to get approved for financing. Of the five factors that determine FICO credit scores, none play a bigger role than payment history, which accounts for 35% of your score. Regardless of why you were late, a single late payment can cause your credit score to drop significantly.
If a late payment caused your score to fall, a goodwill letter could be the solution, depending on your creditor and situation. Here's a closer look at goodwill letters, how they work, what to include, and whether they can accomplish what you need.
What is a goodwill letter?
A goodwill letter is a written request sent to a creditor regarding a late payment it reported to the credit bureaus. Late payments could be from credit cards, loans, or other types of credit or financing. Late payments and other negative marks can damage your credit long term and cause your credit score to drop. Negative marks can remain on your credit report for up to seven years. When you send a goodwill letter to a creditor, you request its assistance in removing the negative mark from your credit report.
Goodwill letter requests are sent to creditors, not credit card bureaus. Only the creditor that reported the late payment can remove the negative mark. By removing the late payment, you can continue to build up your credit without the consequences of a negative mark.
When to use a goodwill letter
You shouldn't send a goodwill letter to your credit card company or creditor just because you had a late or missed payment. You need to have a good reason or excuse for why the late payment occurred, like:
- A temporary financial hardship
- Delays due to switching banks or a change of address
- Failure to set up automatic payments properly
Sending a goodwill letter may show creditors you're serious about improving or repairing your credit. That doesn't mean they'll approve your request to remove negative marks, but it's a start.
A goodwill letter is a way to ask for mercy and help in moving your credit in the right direction. If you're a loyal customer, the creditor may extend you grace to continue the business relationship.
How to write a goodwill letter
Below is a goodwill letter template to guide you when writing credit card issuers. Customize it as needed to fit your specific situation.
To Whom It May Concern,
I am writing regarding a recent late payment on my (creditor name) account reported to the credit bureaus.
I've enjoyed being an account holder and building our business relationship. The recent late payment on my account was due to (insert explanation). I am sorry for the inconvenience and understand that I am solely at fault for the occurrence. I am dedicated to making sure my monthly bills are paid on time moving forward.
Would you consider making a goodwill gesture and removing the late payment from my credit reports? A goodwill adjustment would allow me to continue my efforts to build up a positive credit score and history and remain in good standing with (creditor name).
Thank you for your time and consideration,
(Your name)
(Your account number)
Card companies may have a specific department that handles goodwill requests. If not, send it directly to your issuer’s customer service department, either by mail, email, or private message through your online account if available.
Do goodwill letters work?
Unfortunately, there's no way to know if sending a goodwill letter will lead to your card issuer removing late payments or other negative marks from your credit report. Some issuers, like Bank of America, state that they don't honor goodwill adjustment requests. Requests are more likely to be approved for late payments than more severe offenses.
If you're looking for assistance from your credit card company, there's no harm in asking. As long as you understand you may not achieve the intended result, there's nothing wrong with sending a goodwill letter. The worst thing that can happen is that your request is denied, and you waste a little time writing and sending the letter.
Whether sending a goodwill letter works or not, you can start building up your credit score by making on-time payments and developing a positive credit history.
