How to Write a Goodwill Letter for DIY Credit Repair
Credit repair sounds good, but consumers should almost always avoid working with a “credit repair” agency. These firms typically use borderline-ethical practices that try to beat the system and often leave you out of money and with no results. The worst part is that anything worthwhile they actually accomplish can probably be done by you for free. One of these tactics is a goodwill letter, and it can be one of the most powerful tools in credit repair. Let’s take a closer look at what it is and how to use it.
What is a Goodwill Letter?
A goodwill letter is a written request to a creditor asking them to remove negative information from your credit report (called a “goodwill adjustment”). As the name suggests, you are asking the creditor for their courtesy and compassion, that they will forgive a mistake you’ve made.
Remember, This is Different than a Dispute.
One thing to keep in mind, both when you write the letter and when you receive your response, is that this is different than disputing an error. In this case, there hasn’t been a mistake on their end—you did miss a payment, end of story. The creditor, then, doesn’t owe you anything. Just keep this point in mind so that you won’t be disappointed if you don’t get the response you were hoping for.
When Should a Goodwill Letter Be Used?
You might get different answers to this question, depending on who you ask, especially if you were to talk “off the record” with a representative in the credit repair industry. In reality, this should only be used in a handful of situations:
- If there was a technical error in processing your payment. If you tried to pay your bill and/or encountered some sort of glitch that led to a negative mark on your credit report, that would warrant potential removal by the creditor.
- If autopay failed. If you set up autopay and it didn’t go through either due to a technical error (see #1) or lack of funds in your bank account, this might also warrant a removal. Perhaps it was an honest mistake that your bank account didn’t have the funds, because you had moved them for another purpose.
- If you have an excellent history and made one mistake. Creditors understand that mistakes happen sometimes. If you have demonstrated your ability to pay on time consistently and then one month make a mistake, the creditor might think it’s reasonable not to hold that against you.
In all of these scenarios, the creditor can see intent and attempt. It’s clear that you wanted to pay and that you tried. With this established, it’s much more likely that they will honor your request.
It’s certainly possible that a goodwill letter might be effective in other scenarios. For example, if combined with an offer to pay a lump sum for an overdue debt, it could be used to remove a collections account from your report. Or, maybe you’ve made quite a few mistakes and missed payments with multiple creditors and want to use this strategy for all of them.
We won’t advocate for this use of a goodwill letter because there is no certainty that the offer will be accepted and because it’s an ethical “gray area.” After all, the creditors and collections agencies are legally bound to the credit bureaus to reports accurate information, and so the ability to have this information changed should not be abused. At the same time, you obviously want to restore your credit to the best possible condition, and it likely can’t hurt to ask.
Guidelines for Writing the Letter
If you move forward with a goodwill letter, be sure it includes some key pieces of information:
- Your account number
- The address listed on your credit report
In addition, ensure it meets these guidelines:
- It should be a physical letter, not an email.
- The letter should be concise (short and sweet).
- You should describe the issue and what caused you to miss the payment.
- Explicitly ask for courtesy and to have the item removed form your credit report.
If you aren’t confident that you can create the letter from scratch, feel free to use our template. Our template is a downloadable Word doc, but here’s the meat of the letter:
To whom it may concern,
I am writing in regards to [a late payment/late payments] on my credit report from [date(s)] for my [Creditor Name] account.
I understand how important it is to make timely payments, and that failure to do so creates an inconvenience for you. However, I missed my payment because [brief explanation for missing your payment, ideally showing attempt/intention to pay]. I am confident that this won’t happen again and I have taken steps to ensure my financial responsibility moving forward. [If applicable add: Since [and/or prior to] this mistake I have a perfect record of on-time payments.]
As a courtesy, I am requesting that [Creditor Name] make a goodwill adjustment and remove the late payment on [date] from my record. This will help improve my credit worthiness and give me renewed confidence in being a [Name of Creditor] customer in good standing.
Thank you for your consideration,
What to Expect
After you send the letter, you should expect a response in about two weeks, though sometimes they take much longer or don’t come at all. If you don’t hear back in couple of weeks, you should call to inquire.
The Creditor’s Perspective
How will a creditor determine whether to make the goodwill adjustment on your account? Many credit experts believe it involves a combination of the following factors:
The length of your credit history with the company. The longer your credit history with the particular creditor, the more likely they are to offer a goodwill adjustment to you.
The length of time since the delinquency. Creditors are typically more likely to offer the adjustment to a delinquency that happened a while ago.
Your account status since the delinquency. Paired with the point above—creditors want to know that you’ve successfully and responsibly maintained your account since the delinquency. If you have, you are much more likely to receive the adjustment. In addition to on-time payments, they might also be looking for card activity, to make sure you are actively using the account but, at the same time, not overdoing it (spending more than you can afford).
Have you already had a goodwill adjustment, particularly in the last 24 months? If you’ve been given a goodwill adjustment from the same company within the last 24 months, the chances of receiving another are extremely low.
Give Yourself some Goodwill
If you have a late payment or two on your credit report, this can be a great strategy to try, and you might get the results you are looking for. Remember that it’s much safer and cheaper than working with a credit repair firm, but it may not work out in your favor. The most reliable way to have good credit is to budget wisely, minimize credit card use, and/or pay your balances in full each month. If you implement these habits, you’ll be well on your way to a healthy credit score.
Should the goodwill letter be sent to the creditor or the 3 credit agencies?
Hi Nasha! You send the letter directly to the creditor!
I tried submitting a goodwill letter to Navient to get late student loan payments removed from my credit report. They replied saying they’re legally required to report the late payments. Is this true? I feel like they’re just using it as an excuse.
Hi Jay! I’m sorry they didn’t remove the late payments. They are not obligated to remove it, so they don’t really need an excuse, unless you’re appealing it or claiming it is a mistake on their part. Good luck getting it worked out!
I have a late payment my old credit union reported on a card that I hadn’t used for about 8 years. I found out my ebay account was linked to it when I sale something to pay for the fees (hadn’t sold anything for a long time). The charge was $5.85 and ended up being about 65 days late (we never received the statements because the address was wrong and only learned about it after they called us). I requested a goodwill adjustment and they are saying the the fair credit act prohibits them from doing anything like what I’m requesting (i.e., retract the reporting of the late payment). Does this sound right? Has anyone else ran into this before? The lady I spoke to sounded very sincere like she wished she could do something and had talked to everyone she could internally. She said the Credit Union could get slapped with a fine if they did what I requested.
The FCRA doesn’t require “reporting of all credit accounts”; it simply stipulates that IF a company decides to report something, it must report it accurately. In other words, companies can, at their discretion, remove the accounts from your credit report, but then they would have report the whole thing. I hope that helps!
I filed bankruptcy and I have 3 accounts showing in collections. Each account shows $0 balance and the comments stated that it was discharged with bankruptcy. Is this dragging my score down and can I get these off of my report?
Hi Terrica! It’s hard to know how these things affect your credit score since scores aren’t transparent. I hope that helps!
I would like to know would a goodwill letter help with a foreclosed property? In 2012, my rental property was foreclosed. I know that it takes 7 years before it is removed. I have been in good standing on all my other financial obligations. Will I have to wait until 2019 before I try to have it removed?
Hi Aisha! You have nothing to lose! I hope that helps!
hector luis dones
thank you for you help !
In this day and age, few of us have the privilege to hire anyone for this or that, and sometimes that advice is incorrect.
Your information has been more helpful than two attorneys I have talked with (consultation only)…rates are higher. Thank you for allowing us to have some guidelines ourselves in trying to find resolutions to same.
Great to hear SueAnn, I hope this site as a whole is helpful to you. The goodwill letter is certainly far from a sure thing, but can be a useful tactic. Best of luck to you.
My husband contacted the credit card company and asked for marks to be removed. They said the could not remove them, only the three credit agencies could. So who do I send the goodwill letter to?
Please help I have negative item on my credit report which they are 8 years old how could i remove those items they were my ex husband. I am trying to purchase a land. I had 8 credit cards pay off 3 of them, I only have 3 more credit cards i do pay on time. I lived in the cold weather i need to be in warm weather do to medical condition please adivce thank you. Irene
PLEASE HELP. I am helpless and néed your help. I work on Grammy Awards.Oscars, AMA etc for 20 years in union. ETC. My score is 58o need to buy house soon. I paid off all my debts. Ihave 5 credit card in good standing card..I hAve proof of income. Please have things removd so I ca.n be with my wifeet and kid. *Cheers Derrick
It sounds like you might have some negative marks weighing your score down? Time will certainly help with those. It’s also important not to carry too much of a balance from month to month. Not only should your cards be in good standing, but if you can pay them off in full each month (or close to it) that will help tremendously. Lastly, you might consider asking for a higher credit limit on the cards. You wouldn’t use this extra limit, but it could help improve your utilization, which would lead to a higher score, all things being equal.