The length of time a credit-related event may be reported on a consumer’s credit report depends on the event type. Hard credit inquiries, for example, may remain on a credit report for up to two years. A late payment, on the other hand, will typically remain on a credit report for seven years.
Indeed, a late payment may affect a consumer’s credit long after the account is paid off, and it will continue being reported even after the account is closed. A consumer with good credit who has a long history of making timely payments is unlikely to see a significant drop in their credit rating due to one or two past-due payments. The existence of a late payment can, however, carry a harsh penalty for a consumer who does not otherwise have strong credit or for one who does not have much of a credit history.
Unfortunately, account delinquencies are reported in the same manner irrespective of the reason for the delinquency. In other words, a consumer who makes a late payment because they were preoccupied by illness or they were otherwise delayed for a reason outside of their control will be penalized the same way as a consumer who cannot afford to make a timely payment or who simply isn’t responsible about paying on time.
All hope is not lost, however, because there is no rule requiring all delinquencies to be reported for any amount of time, let alone for the entire permissible reporting period of seven years. When an otherwise responsible consumer is faced with making a rare late payment, they may be able to head off reporting the delinquency by simply contacting the creditor and explaining the situation. Of course, a creditor is unlikely to consider such a request unless and until the late payment is actually made. Assuming the consumer settles the delinquency and does not have a history of making late payments or requesting late payment forgiveness, such a request is not seen as unreasonable.
If, however, a consumer provides their late payment without contacting the creditor and requesting that the delinquency not be reported, the consumer will almost certainly see the past-due payment appear on their credit report irrespective of how flawless their account activity has otherwise been.
Once a delinquency appears on a consumer credit report, the consumer can try contacting the creditor to request removal of the delinquency. Under identical circumstances, it takes more effort for a creditor to remove the delinquency after it has been reported, so it is in the consumer’s interest to contact the creditor as soon as they know their payment is going to be late and, ideally, before the late payment appears on their credit.
If the creditor is unwilling to remove the delinquency, a consumer can open a dispute with the credit reporter—e.g., TransUnion, Experian, or Equifax—and simply ask for its removal. If the creditor does not dispute the request, the credit reporter should grant the consumer’s request and promptly update the consumer’s report to reflect the removed delinquency.