Minor mistakes like missing a credit card payment can have big effects on your credit score. Luckily, you don’t have to fork out hundreds or thousands of dollars to remove these minor issues from your credit report.

Here’s how you can remove late payments or accounts in collections from your credit report yourself for about the cost of a movie ticket.

This is a guest post written by Anthony from Novita Financial. If you want help fixing your credit but can't afford credit repair, Novita can help. Use discount code 9OY41Zph for a FREE subscription. We'll help you write and send goodwill letters (and a lot more).

The Method

The tool we’ll be using to remove these unfortunate marks is called a Goodwill Letter. A goodwill letter is just a request to a lender or collection agency to remove negative marks on your credit report.

I hear you saying, “so that’s it, I just ask them to take things off? That’ll never work!”. You’re almost right, because it ALMOST never works.

There’s a certain chance that each person who receives your letters will be able to help you. To maximize your chances of succeeding, your letter needs to:

  • Be as persuasive as possible
  • Reach as many hands as possible

If each person who reads your letter has a 1% chance of helping you, just send 100 letters and chances are you’ll get what you want.

In credit as in life, persistence and persuasion are key.

How to format a Goodwill Letter

I noticed three things in common between all the letters I’ve seen:

  • Keep your tone always kind and cordial. This makes sense - it’s a “Goodwill” letter… goodwill as in “a favor”. You don’t start asking for a favor by slapping someone upside the head, right?
  • Prove your value. Our goal is to be as persuasive as possible, so we need to understand the bank’s motivations to explain how we further their goals. “Duh” - make as much money as possible. We start by explaining why we’re a valuable customer.
  • Explain why you went wrong. If you missed a payment for a good reason, let them know. Family emergencies or medical problems are a strong contenders for removal with goodwill letters.
  • Make The ask. Successful letters rarely ask for items to be removed from their credit report directly. They instead ask for a “goodwill adjustment” to their credit reporting. Remember, banks have agreements with credit bureaus to report on late payments. If the banks went around fudging everyone’s payment history, the credit reporting system would break down.
  • Keep your tone kind and cordial

    It’s frustrating, right? The only thing standing between you and that great credit score is the bank. You want to give them a piece of your mind to whip them into shape.

    Resist that urge and instead let’s “kill them with kindness”. Here’s an excerpt from a sample goodwill letter on the MyFico forums.

    Goodwill letter sample

    The tone is similar to writing a resumé or CV. Formal, positive, and non-confrontational. The bank wants to make money, but the bank doesn’t read your letter, people do. So be nice.

    The example below is a great mix of gratitude and urgency.

    Goodwill letter sample showing gratitude

    Prove your value

    Any good business needs good customers. Explain to the bank why you’re an excellent customer and would be sad to see you go. Here are some things that’d make you a great customer:

  • Generally consistent repayment history
  • Being a customer for many years
  • Business banking
  • Substantial investments or retirement savings
  • Make The Ask

    To ask them to remove a late payment from your credit report, you need to ask in a bit of a special way.

    Banks and credit bureaus work closely together. Experian or Transunion would lose credibility if the information they got from banks was unreliable, so they’ve made agreements with lenders to keep their reporting accurate.

    Rather than asking for an item to be outright removed from your credit report, instead ask for a “goodwill adjustment”.

    To translate this into English, you’re asking them to do you a favor on the strength of your past relationship, or the promise of one in the future.

    How to Send a Goodwill Letter

    The Goodwill Letter Saturation Technique

    If you send your letter to just one person one time, your odds of succeeding is very low. If you want to maximize your chances of success, you need to get your letter into as many unique hands as possible.

    Here’s how to do it:

    1. Get as many unique addresses for your lender as you can

    The address listed on your credit report is a good place to start, and Google will be your friend here. Each address you send your letter to is one more opportunity, so find at least 6. You’re not limited to just physical addresses, either. You can also send your letter to:

    1. Your lender’s online contact form
    2. The LinkedIn account of your Lender’s CEO
    3. The LinkedIn account of your lender’s VPs
    4. Email addresses of employees or support channels

    Be creative. If you think of any other ways to send your letter, drop it in the comment section below to help others.

    2. Send your letter multiple times

    Chances are your lender is a big bank. Big banks have lots of employees with different schedules. Since your goal is to reach as many unique hands as possible, you want to send your letter on every different day of the week.

    Divide your sending into 3 rounds. For each round, send your letters to every address in your address list.

    Goodwill letter saturation technique days
    1. Monday and Thursday
    2. Tuesday and Friday
    3. Wednesday and Saturday
    4. Nothing on Sunday, because…
    No post on sundays

    The trick to getting Goodwill letters to work is persistence. Poke around online and you’ll find hundreds of success stories with one consistent theme - each person sent A LOT of letters to A LOT of different folks, but eventually their late payments were removed.

    No late payments

    Sample Letters

    MyFico has some great sample letters for you to use: available here

    If you have any questions or just want to share your story, please let us know in the comments below.