A letter to improve your credit will not always help you restore a pristine credit rating, but writing out and mailing in your own explanation of a late payment may go a long way to raising your credit score by eliminating negative items in your credit report.
You can be certain that late payments are the worst thing you can do to negatively affect your credit history. Making a credit card payment 30 days late is the fastest way to lower your all-important FICO credit score.
FICO -- which stands for Fair Isacc Co. -- refers to the firm which developed the credit scoring model used by a majority of lenders and credit card companies today when they are deciding if and how much credit they will issue in your name.
What Makes Up A Good Credit Score?
The FICO scoring system ranks the following items in your credit history by these percentages, according to MyFICO.com:
1. Your past payment history -- 35%
2. Amounts you owe on credit cards, loans, etc. -- 30%
3. Length of your credit history -- 15%
4. New credit you have applied for, used -- 10%
5. Types of credit used -- 10%
As you can see from the above list, fully two-thirds of your FICO credit score will be based on (1) your timely payments you've made in the past, plus (2) the total amount of debt you've carried on credit cards, monthly consumer loans, department store credit cards, and the like.
You can control timely payments. Therefore, it is clear to see that if you want to fix your bad credit, your best option is learning how to keep your payment history accurate, as well as striving to find new ways to keep debt levels low.
The good news: bad credit doesn't have to last forever! By taking proactive steps today, you can repair your credit report and score in the future. This article will focus on the first way to dispute negative credit by writing letters to explain late payments on your credit accounts.
How To Get Started Writing Credit Repair Letters:
Here are some simple steps to take when drafting your own late payment explanation letter:
Be upfront and honest when you write a letter to dispute a late payment. If you know you were late, then say so and ask for forgiveness. Remind them you are a good past customer, and intend to be a better customer in the future. If you dispute the accuracy of the late payment, include a copy of your online payment statement. Just make sure you copy these payments to your computer if you need to prove an online payment in the future or else you won't have any proof to get your request satisfactorily answered. Send your letter as soon as possible after the payment is late. If you procrastinate and wait until the creditor contacts you, you lose a lot of negotiating room in your argument. By proactively admitting your mistake and asking for forgiveness, you stand a better chance to prevent negative items showing up in your credit report.Free Sample Late Payment Letter
We've added a link to an excellent sample late payment explanation letter provided by Buzzle.com, which shows you how to start writing one of your own.
Organizing your own unique words and thoughts into writing your personalized explanation of a late payment can help cure your bad credit score by removing negative items from your credit report with the stroke of a pen and for only the price of a postage stamp. The cost is minimal; the results can be substantial. Make the effort now to write a late payment explanation letter to correct your credit report today.
Steve Johnson is the writer and publisher who created Credit-Letters.com. Some of the most popular features at Credit-Letters.com are the free credit repair sample letters you can review, copy and edit to your own use yourself for correcting your credit report and raising your credit score.