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One of the most important rules we recommend everyone follows is paying off their credit card balances, in full, whenever possible.
Late payments can come with penalties like late fees that can impact your budget and your credit score. In fact, payment history is the largest factor considered for your FICO score — which is what most lenders use to determine creditworthiness.
There is a way to come back from a late payment slip-up, and that is by utilizing a goodwill letter.
What is a goodwill letter?
A goodwill letter is a request to your creditor to remove a late payment notice from your credit report. Negative marks on your credit report can last up to seven years, but these simple requests can help keep your report spotless and your credit score healthy.
These requests are not meant to dispute errors on your credit report (which should be taken up with the three credit bureaus) — rather they are an apology to your credit issuer for missing the payment and a goodwill statement that you will pay your bills on time moving forward.
Of course, a goodwill letter doesn’t necessarily have to be physical. You can also call the number on the back of your credit card to speak to a customer service representative and request that the late payment be removed.
Just keep in mind that the first person you talk to on the phone may not be able to help; you’ll need to politely request that the issue be escalated to a manager or a different department that can handle the request.
You can also reach out via email, but emails can easily get lost in the shuffle.
What to say in a goodwill request
When you call or write in, make sure to include the following:
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- Your account number
- Your billing address
- Reason for why you missed your payment due date
- Your specific request to have the information removed from your credit reports
Issuers with goodwill adjustment policies
Keep in mind that issuers are not required to make adjustments. Some issuers even have outright policies against making any adjustments after your late payment has been reported to the credit bureaus.
- Bank of America: Per their terms, Bank of America does not honor goodwill adjustment requests.
- Chase: Chase is another issuer who does not make goodwill or courtesy adjustments to credit reports.
- Amex: Unlike some of the others on this list, American Express doesn’t list a specific policy on its website regarding goodwill adjustments. However, many online forums have reported success stories of customers being able to request a goodwill adjustment, so it’s worth a try.
- Citi: Like Amex, there are plenty of success stories of Citi customers who were able to reach out and get a late payment removed from their report, so reaching out to this issuer is also worth a shot.
- Capital One: Capital One doesn’t have a policy against goodwill adjustments, which means you can call or mail in to request a late payment to be removed from your account. It’s good practice to make sure your late bill is paid before reaching out.
Catching missed payments early
If you do miss a payment, it’s important that you catch it early. Most issuers only report credit activity approximately every 30 days.
This means if you catch the late payment early and rectify your account, the issuer may not report it to the credit agency. While you’ll likely still get hit with a late payment fee, in this case, your credit score won’t suffer.
Related: How to check your credit score
Avoiding late payments with autopay
The best way to avoid late payments altogether is to set up autopay. This is a simple way to ensure you never miss a due date.
It’s easy to set up autopay online or in your issuer app, and you can generally set the payment up to cover your minimum required amount — though we recommend paying your credit card bill in full.
Bottom line
Life happens. Sometimes, a payment due date slips through the cracks. Luckily, a blemish on your payment history could be removed if you contact the issuer and they’re willing to work with you. Issuers are sometimes flexible about waiving late fees and other penalties. Plus, there are features, like autopay, designed to help you avoid incurring late or missed payment fees.
When you do notice a missed payment, the best thing to do is take care of that bill amount immediately and contact your issuer. There’s a good chance that you’ll be able to prevent the payment from landing on your credit report and affecting your credit score long-term.