What are goodwill letters and do they help your credit score?

Quick insights

• Goodwill letters are a type of formal request you can make to a creditor to have a negative mark related to a missed payment removed from your credit report.
• These letters should be professionally written and include an explanation of the circumstances that caused you to miss the payment and what steps you’ve taken to ensure it does not happen in the future.
• While some creditors have a policy against accepting goodwill letters due to regulatory oversight, others may consider the request seriously, alongside a review of your payment history.

A goodwill letter is a written request to a creditor asking them to remove a negative mark from your credit report. These letters are often used when the late payment was the result of a genuine mistake or unforeseen circumstance. Writing a goodwill letter is one way to proactively manage one’s credit score. 

In this article, we’ll identify what to include in your goodwill letter, when to consider sending one and factors that may influence its outcome. 

How do goodwill letters work?

Goodwill letters provide a formal opportunity to address a missed payment and provide the creditor with the context needed to understand why it happened. Ideally, the letter is written in a professional format, with a polite tone throughout. Creditors are not obligated to fulfill your request, so be careful to avoid assumptions in how you write your message.

When to consider sending a goodwill letter

There are unforeseen circumstances that may cause a person to miss a payment, such as medical emergencies, the loss of a family member or natural disasters. These are clear examples of situations where goodwill letters are considered. However, there may be less serious reasons why you missed a payment, but it could still be worth writing a letter to explain what happened.

If you have an otherwise spotless payment history, it’s possible that regular human error (like missing your due date due to the general activity of life) may be reason enough for a creditor to honor your request. However, understand that your creditor will review and consider your record of making payments. Those who habitually miss payments or have repeated delinquencies may be less likely to have their letter honored.

What to include in your goodwill letter

Writing a goodwill letter to remove a late payment doesn’t need to be a highly creative activity. On the contrary, there are standard elements to consider including in your letter:

• Account data and formality: Include your name, account number and the date. Address your letter “to whom it may concern” and use a polite and respectful tone throughout. 
• Explain why the payment was missed: In formal language, you should indicate the circumstances that caused you to miss the payment. For example, job loss, a medical emergency, technical issues or an honest mistake.
• Promise to stay on top of payments in the future: Make sure to mention that you understand you are responsible for making payments in a timely manner, and what has changed about your circumstances or approach to ensure you do.
• Identify why you want it removed: If possible, you may want to mention plans you have relating to your credit and how the negative mark will affect them. For example, an upcoming application for a mortgage or new car.

Goodwill letters can typically be sent by mail or email. Your creditor may explicitly state an address to mail your letter to on their site or in other documentation. If you have trouble finding an address for your message, try reaching out over the phone for an answer.

Do goodwill letters work with creditors?

Sending a goodwill letter may or may not work with a particular creditor. Some institutions, like Chase Bank, have a policy against goodwill letters due to a credit reporting requirement.chase-faq-25-credit-reporting The circumstances you mention in your message will be honored at the creditor’s discretion.

Alternatives to goodwill letters

If your goodwill letter is not honored, keep in mind that there are other ways you can try to improve your credit:

• Monitor your credit: Using an online tool, such as Chase Credit Journey®, can help you stay in the know regarding your credit. Credit Journey® allows you to view your credit score anytime for free, which can be helpful for those looking to make long-term improvements. Anyone can sign up, including non-Chase customers.
• Dispute inaccurate information: If you believe that the negative mark was made in error rather than because of a missed payment, you can file a dispute with the credit bureau and creditor. If you're a Credit Journey user, you can refer to the dispute guide in the tool for step-by-step support.
• Set up automated payments: To ensure you don’t forget to make your payments on time again, you can consider setting up automated payments. This may help slowly recover your credit with time.
• Consider a debt repayment plan: If the negative mark relates to a larger problem you’re having with debt, you may want to communicate with your lender proactively to discuss a debt repayment plan.

In conclusion

While goodwill letters can provide an opportunity to appeal to your creditor, they aren’t a guarantee that a negative mark on your credit report will be removed. A clear, professionally written letter and otherwise consistent history of payments may help improve your chances of success. Whether or not your appeal works, continuing to monitor your credit health and engage in responsible financial management going forward may help improve your score over time.