Before contacting your lender about removing negative items from your report, you need to determine if the mark was listed by mistake or was an error on your part. Here is how you can get inaccurate late payments removed, whether there was an error on their end or yours.

1. Analyze your late payments

Each of the credit reporting agencies (Equifax®, TransUnion® and Experian®) allows one free credit report copy every year. By requesting your free report from one of the credit bureaus every few months, you can ensure your credit is in good standing.

When analyzing your report, any late payment you come across should be under seven years old. Although it’s rare, sometimes older delinquencies can remain on your report after their expiration period. If you do find an older late payment on your report, make sure to call the bureau and file a claim to get it removed.

2. Dispute incorrect claims

If you find a late payment within the seven-year time frame that you don’t recognize, there’s a chance your lender made a mistake when reporting it. You can dispute this claim directly with the credit bureau, with your credit card company or even with your collection agency. After filing a claim, the company has 30 days to investigate before sending through their ruling.

To help make your case, providing proof that you made the payment on time is important. If you can, send through an account statement or payment confirmation on the date you made the payment to help speed the process along.

3. Write a goodwill letter

A goodwill letter is a formal explanation of why a late payment was made that you can send to creditors in hopes of getting your report wiped clean. While not always successful, a goodwill letter is often recommended for those who have fallen on economic hardship due to circumstances out of their control. Examples can include health issues, sudden loss of employment or even natural disasters.

When writing a goodwill letter, it’s important to be respectful, honest and sincere. Discuss your credit history (if in good standing) and the actions you plan to take to ensure a late payment doesn’t happen again. If you don’t hear anything back after several months, consider calling, emailing or sending updates of your current on-time payments to help change their minds.

4. Send a pay for delete letter

If you have a significant amount of debt, you may benefit from pay for delete services. This method removes negative items from your credit report in a settlement negotiation with debt collectors or the original creditor, but it's not without risk. For example, if you make a promise of payment, this extends the statute of limitations and makes collection enforceable on debt that otherwise might be uncollectible.

5. Negotiate with lenders

One of the final options you have for updating your credit report is negotiating directly with your lender. While not always successful, offering to pay your debt up front in a lump sum or setting up automatic payments to prevent this from happening again may be enough to convince your lender to drop the late payment from your report.

Bankruptcy is a legal process that can stay on your credit report for seven to 10 years. Long after debts have been paid off and discharged, their remnants can still send credit risk “red flags” to future lenders. (Just a heads up: If you’re concerned about bankruptcy, it is always a best practice to consult a bankruptcy attorney to evaluate your individual situation and options).

Bankruptcy laws were created to give those that suffered financial setbacks a chance to start over. There are six types of bankruptcy, but the two most common types are Chapter 7 and Chapter 13. It’s important to understand each type, the application processes involved, and how they will affect you.

Chapter 7 bankruptcy

When Chapter 7 bankruptcy is filed, an order called an "automatic stay" is issued. This is an injunction that prevents creditors, collections agencies and government entities from pursuing collections on exempt property. Items include evictions, foreclosures, and contempt of court for alimony or child support.

Chapter 7 is a liquidation of assets that wipes out most of the debtor's general unsecured debts (credit cards and medical bills) without paying back the balances. This type of bankruptcy works best for those with low income or little to no assets. A trustee is assigned to the case that looks at documents and sells off non-exempt property (e.g. expensive vehicles) to pay back the debts. If there’s no property to be sold, then the creditors receive nothing.

Chapter 7 can remain on a credit report for as long as ten years before it drops off. If you ever find yourself back in financial trouble after filing for

Chapter 7 bankruptcy, there is an eight-year waiting period from the original filing date to reapply.

Chapter 13 bankruptcy

Chapter 13 is bankruptcy for people that make enough income to pay back to creditors through specialized monthly payment plans. Considered a "reorganization," you can keep all your assets, but you have to pay an equal amount for the non-exempt property (some lenders look a little more favorably upon Chapter 13 bankruptcies because of this)

Individuals that can file for Chapter 7 usually opt for Chapter 13 because of the benefits that come with it:

- the ability to catch up on past missed payments such as mortgages, lien, or car payments.

- non-discharged debts such as alimony or child support can be paid off in three to five years.

- if an account was delinquent during the bankruptcy, it will be deleted seven years from its original delinquency date.

With Chapter 13, you agree to pay off all debts within a three-to-five-year timeframe. Once paid off, the negative items fall off all credit reports within seven years of the filing date. Bear in mind, declaring bankruptcy does not alter the original delinquency date or extend the time the account remains on the credit report.

How to raise your credit score after bankruptcy

Once a bankruptcy is discharged, raising your credit score is the next goal. Most people know the harmful impact bankruptcy can have on your credit, so trying to recover can feel like a daunting process. But with some effort and the proper steps, you can make a real difference and start to see improvements.

When you don’t pay back a debt, the lender or creditor can close out your account, mark the debt as non-collectible and claim it as a business loss on their taxes—a process known as a charge off. This doesn’t mean it stops affecting you, though, since the debt will likely be sold to a collection agency. In fact, you’re still responsible for the debt, whether by paying it off or by settling.

Paid off verses settled

You can pay off or settle your charge off. A payoff is when you contact the creditor and settle the total outstanding debt with them. Some people mistakenly think they can take care of a charge off by paying it off, but this isn’t the case. A charge off will continue to stay on your credit report whether it’s paid or unpaid.

Paying your charge off is seen as minimally beneficial as it will improve your credit score only a little. The bigger benefit is that when you apply for future credit, your lenders will be able to see that while you do have a charge off on your report, you took the initiative to pay it off.

The other option is a settlement on your charge off. In this scenario, you determine who owns the debt (original creditor or a collections agency) and reach out to them to settle. You’ll negotiate with them to pay a portion of the debt—not all—in order for them to mark it as resolved.

Once you make the payment, the debt will no longer be outstanding and will show up on your report as settled. Similar to a paid charge off, a status of “settled” won’t increase your credit score by much and won’t remove the charge off from your account (unless you negotiated a pay-for-delete). When pursuing a settlement, make sure you always get the agreement in writing.

When comparing the two options, most experts recommend you pursue a settlement because you won’t have to pay everything you owe. However, note that most lenders aren’t open to a settlement unless the debt is a few years old.

How to remove a charge off

You cannot remove a charge off from your credit report just by paying off or settling your debt. The only way to actually remove it from your credit report is by negotiating with your creditor after you’ve paid it off.

Regardless of your financial standing, there are things you should (and must) do when you have a charge off tacked on your credit report. Before you dive into a dispute or pay back the debt, take a step back and address the situation to take the proper action.

When a repossession happens, it's added as a negative line item to your credit, whether it was voluntary or involuntary. It's a situation where you stopped making payments on a loan, so it reflects poorly on you as a borrower.

A repossession can stay on your credit report, and impact your credit score, for up to seven years. If there's an outstanding balance after the sale of the asset, the balance will show on your credit report.

How do I remove a repossession from my credit report?

If a repossession is entirely valid and accurate, the only way you could get it removed (other than waiting seven years) is if you can negotiate with your lender to remove the item from your credit report in exchange for paying the debt in full. If the lender agrees to this proposal, make sure you get everything in writing.

Note that not all lenders will agree to this proposal. Still, it's worth trying, especially if you have an outstanding balance after the repossession. Your lender may be willing to work with you because the repayment plan means they don't have to file a lawsuit to get their money back.

You can also remove false repossessions from your credit report ("false" meaning that the repossessions aren't your repossessions, or they contain inaccurate information). Under the Fair Credit Reporting Act (FCRA), every consumer has the right to an accurate credit report and can file a dispute on any incorrect information. If the repossession on your credit report includes wrong dates, names, balances, addresses or other incorrect information, you can file a dispute.