How to Explain Late Payments on Credit Reports

The Federal Trade Commission’s Fair Credit Reporting Act mandates that credit reporting agencies are responsible for ensuring that accurate information appears in consumer credit reports. If a creditor falsely reports you for making late payments, you have the right to contest the report and petition to have the delinquency removed.

The FTC provides a sample dispute letter you can send to any credit reporting company that has inaccurate information about your credit usage on file. Include your name and contact information in your letter, and specifiy the inaccurate late entry you’re addressing. Describe why the entry is wrong, and include copies of documents to support your claim, such as a canceled payment check or a credit card or bank statement that shows on-time payment. If you’ve had direct contact with your creditor to try to resolve the mistake, include details about that as well. Send the letter by certified mail, and request a return receipt.

Credit reporting agencies are required by the FTC to investigate credit entry disputes promptly, typically within 30 days. The credit agency will contact your creditor and investigate the matter, and if your claim is justified, your creditor must take steps to remove the inaccuracy from all credit bureau reports. You’ll be notified of its findings by mail. If your claim remains unresolved, you have the right to place a statement of dispute in your file for potential creditors to see.