You’re so excited that you have to stop yourself from breaking out and dancing right in the middle of the sidewalk. You finally found the car of your dreams and figured out that you have the money for the down payment, you can afford the monthly payments and the insurance, and all you have to do is get approval for the loan. Like most people, your credit rating isn’t perfect, but you do know it is high enough to qualify for the loan you need. You spent the previous evening pouring over every detail of the loan application and making sure every “t” was crossed and every “I” dotted. You have the required employment information, credit references, personal references and a copy of your credit report from each of the big three credit reporting bureaus. You noticed there is a late payment recorded, but your overall score is decent and you haven’t had any problems lately, so you didn’t even give it another thought.
Red Flags on Your Credit Report You’re at the bank or credit union and sit down with the loan officer to go through the loan application together. The loan officer sees you have all the necessary documentation in order, but pauses as the credit reports are reviewed. Unfortunately, for you, that late payment brings everything to a screeching halt. That late payment is a red flag the loan officer cannot ignore.
What can you do? The payment was late and it was reported to the credit reporting bureaus, and now it’s sitting on your credit report like a big red flashing light. So, what can you do? It’s not like you can go back in time and make sure the payment is made before the due date. You can’t simply erase it from your credit report. Due to the bank or credit union’s regulations regarding loan approvals, the loan officer is unable to pretend it isn’t there, no matter how good your reason was for the payment being delayed.
“Fix” Reports of Late Payments Your payment history is the single most important factor in determining your credit rating, and any kind of blemish can stop the loan process in its tracks. Sometimes one single reported late payment can make the difference between you getting the car (or home, etc.) of your dreams or going home empty handed. That late payment is going to sit on your credit report for 7 years unless you can figure out how to make it disappear. “But that’s impossible”, you think. But, is it? Can you do something to make it possible for the loan approval to go through? Yes, there is something you can do. Simply call the creditor and ask them to remove it. They do have that power. It may be a little more complicated than making a simple request, but that is the basic idea. You just have to make the effort.
Watch Damon DeCrescenzo, CEO of The Credit Pros, explain in this video exactly what you can do to take care of late payments on your credit report for loan approvals: