Goodwill letters: A note can get a credit blemish wiped away

You’re at the mercy of your creditor, but a ’yes’ can boost your credit score

Brady Porche
Staff Reporter
Focusing on credit scores and what consumers can do to improve them

Goodwill letters: A note can get a credit blemish wiped away

If your credit history is spotless save for one slip-up, you may be able to wipe it out with a letter to your creditor.

A goodwill letter is a request to a bank, lender or other creditor to remove a missed payment or other mistake from your credit report – an action known as a goodwill adjustment. As the name implies, the creditor is under no obligation to comply with or even consider your request. You’re totally at the mercy of your card issuer.

Goodwill letters are probably not an option if your credit file is messy and you’re looking for a credit score boost. But if you’re a responsible borrower who once missed a payment due to a medical or financial emergency or an honest mistake, a goodwill letter may succeed and help your score quickly recover from the damage. (Missing a payment can drop your score by as much as 110 points under FICO’s credit scoring model.)

“These things work best if it really looks like a fluke,” said Thomas Nitzsche, a spokesman for Money Management International. “If you’ve got a really spotty credit history where you missed a month here and you missed a month there … that’s not going to bode well for your chances.”

Your odds of success also depend on your ability to build a convincing case. A little perseverance helps, too – your creditor may be slow to respond or might ignore you entirely. However, there are success stories that prove a goodwill letter can be worth the time and effort.

Paying back your debt, providing proof are big pluses  

Brynne Conroy, author of the personal finance blog Femme Frugality, once used a goodwill letter to get an unpaid $10,000 college debt removed from her credit report.

“My parents were getting divorced at the time, and there was some miscommunication over who would be handling which semester’s bills,” Conroy said. “I was young and under the impression that somebody else was going to pay it.”

Years later, after Conroy had married and moved away from home, she was contacted by a collections agency about the bill. She repaid it within six months of the collection call, but the negative item remained on her credit report.

After learning about goodwill letters online, Conroy decided to submit one to her former school.

“I explained to them what happened – that I was young and didn’t completely understand the process, and that as soon as I was aware of the debt I paid it off at a pretty fast clip,” she said. “I told them this is going to affect my ability to establish my own family.”

Conroy also included documentation both from the college and the collection agency as proof she had paid back the debt. Within a few months, she received a response from the school notifying her that the collection item would be removed from her credit report.

“I was fortunate in the fact that somebody in the financial aid office had pity on me and decided to remove that item,” Conroy said.

"I was fortunate in the fact that somebody in the financial aid office had pity on me and decided to remove that item."

When is it a good idea to write a goodwill letter?

Goodwill letters can help you get an atypical credit mistake wiped clean. Here are some special cases in which your creditor might give you a break.

You missed a payment because of an emergency

In times of emergency, your day-to-day responsibilities can temporarily fall by the wayside. If you’re injured in a traffic accident or your home is damaged in a flood or a fire, chances are paying your credit card bill won’t be a top priority. And a sudden expense such as a medical bill or an urgent car repair can leave you without the funds necessary to make your next payment.

Your payment failed to transmit

Online payments are usually smooth and secure – particularly among major banks and issuers – but glitches do happen on occasion. Perhaps the bank’s servers were down the moment you made the payment and, unbeknownst to you, it never was transmitted.

Maybe there was a brief blip in your own internet connection that blocked the payment, and you didn’t notice it. Either way, you could be forgiven for getting hung out to dry by technology.

You moved, and your bill went to your old address

Moving can temporarily turn your life upside down, and things can fall through the cracks. Perhaps you weren’t able to get all of your mail forwarded promptly to your new address, or a credit card bill found its way to your old mailbox.

5 tips for writing and submitting a goodwill letter

Following are a few tips that can help increase your chances of getting a goodwill adjustment. You also can find several goodwill letter templates online and view an example below.

1. Be polite.
Never use a negative tone when writing a goodwill letter. Remember – the issuer or lender is under no obligation to erase a misstep from your credit report, no matter what circumstances led to it.

2. Don’t write a novel.
When explaining why you missed a payment, include any relevant facts. For instance, if your home was damaged in a flood, explain why you weren’t able to find a way to make your payment (i.e. there was a mass power outage and thus no way to access your online account, or you were too busy evacuating your home to pay your bill).

However, including too many details or over-explaining your situation can be counter-productive. Mike Sullivan, a personal finance consultant in Phoenix, recommends being direct and concise.

“I don’t think any customer service agent wants to spend hours reading a long story, so I would get to the point,” Sullivan said. 

3. Include supporting evidence.
Conroy’s case illustrates the importance of providing proof to support your case. It could be as simple as a note from a collection agency that your debt was paid in full. Or if you failed to pay because you were seriously injured in an auto accident, you could provide copies of the police report and your hospital bill.

“Anything that can back up your claim and give some evidence that it was beyond your control is definitely going to help you,” said Nitzsche. 

4. Make sure it gets to the right person.
Sullivan recommends sending your goodwill letter to a customer service agent at your bank, rather than the billing or finance departments. You could even deliver a copy of your letter to the manager of your bank’s local branch.

“When you’re sending the letter, it’s important that it gets read by somebody who can do something about it,” Sullivan said.

5. Follow up.
Chances are your goodwill letter won’t get an immediate response. If you don’t hear anything after about 30 days, follow up with a phone call or an email.

“I think [following up] is required in most instances unless your situation is so simple that they’re going to act on it,” Sullivan said. “There’s a good chance it is going to sit in a pile, so follow-up is important.” 

It doesn’t hurt to try

A single missed payment can tarnish an otherwise clean credit report and severely damage your credit score. If you have an out-of-character credit blemish and preparing to apply for a home loan or a high-end rewards credit card, a goodwill letter might be worth the effort.

If it works and your FICO score jumps from the high 600s to the mid-700s, you could ultimately save thousands of dollars in mortgage interest charges or earn a big credit card sign-up bonus.

Even if you’re not in the market for a new home or a credit card, a score boost from a goodwill adjustment can paint a more accurate picture of the responsible borrower you truly are. 

Goodwill letter example

Goodwill letter template

Goodwill Letter Templates, by Dan Ponjican, is licensed under BY-NC.

See related: Can I fix late card payment damage after autopay fail?, How quickly can my score recover from a late payment? 


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Updated: 06-20-2018