We’ve mentioned in the ‘6 Things to Know About Credit’ article that late payments are sort of there worst. They hurt your score if they show up on your credit report, and they usually take seven years to drop off of your credit report. Worse still, late payment information is usually accurate, so it’s hard to get late payment records off of your credit report. But don’t fret – there’s still plenty you can do to reduce the impact of late payments on your credit score.

Most importantly, avoid late payments at all costs.

Easier said than done – we know. Sometimes you just can’t make your payment. But if at all possible, make your minimum payments on time. But before you do, understand what “on time” REALLY means for you:

Understand when debtors report to the credit bureaus.

Credit cards, for example, will give you a payment deadline, and they might ding you with a fee if you pay past that deadline. But guess what? They don’t report to the credit bureaus on the day your payment is due. Most debtors won’t report you to the credit bureaus until you’re at least 30 days past due on your payment. We’re not saying to always wait 29 days to make your payments, but if making your minimum payments on your various debts is problematic for you, your first step should be to understand when exactly each debtor reports to the credit bureaus, and create a timeline for paying your bills accordingly.

If you’re 30 days late, don’t be 60 or 90 days late.

If for whatever reason you don’t get your payment in before the debtor reports you as 30 days past due, don’t give up! Try to get a payment in before you’re 60 days past due, because they’ll report you to the bureaus AGAIN at 60 days, and that’s way worse. So you can imagine how much being 90 days late is for your credit score.

If you do have a “late payment” that’s been incorrectly reported…

…then that item is a top priority for your credit repair process. We’ve mentioned before that most late payments on your credit report are correct. But if there’s any chance it’s not correct, you’ll want to dispute this asap and be vigilant in following up on it. (Side note: this is an area where Swell can really help. Get in touch to chat about how we can help, completely free).

Many debtors will let you do a payment plan.

Most utilities companies and some collections agencies, government agencies, and even credit card companies will let you do a monthly payment plan for whatever you owe them. Often they don’t require you to pay very much on a monthly basis, and sometimes it’s without interest. Regardless of the type of debt, if you think you can’t make your payment or need more time, ask about a payment plan.

(Almost) never pay the full amount of a collection

The #1 thing to know about debt collectors? They will very often accept less than the original debt. Let’s say you got behind on your utilities payments to the point that they sent your debt to a collections agency. The utilities company will often be willing to accept 70%, 50%, or even less of the amount you originally owed. So negotiate with the collections agencies. Some will easily accept your offer. Learn more about managing collections here.

Make sure any debt you’ve paid is completely deleted from your credit report.

All of the work you do to get a late payment paid and removed from your credit report will be for nothing if it’s not actually removed from your credit report. So before you pay a collections agency or other debtor, try as hard as you can to get them to confirm in writing that the debt will be completely deleted/removed from your credit report. If they report the debt as ‘paid in full’ or ‘settled’ it can still have a negative effect on your credit score. This is an area where Swell can help a lot, so get in touch if you need guidance.