09-17-2012 04:17 PM
Good day everyone! I am trying to help out a friend. She's been avoiding her credit situation for 2 years now. In other words, she lost her job, lost her home, and is now too scared to deal with the negatives on her reports. I opened her up and she let me in. I told her not to avoid this matter to work on it and that I would help. In short she has a 6.7 year AAOA, she has 2 recent inquiries (from me helping her), she has no other negatives besides 6 accounts in collection (credit cards mostly WFFNB), and one short sale from her home loan gone bad. We are writing good will letters etc. I told her she needed a credit card to get some positive history back so she agreed to let me apply her for Capital one. Her FICO is 536 TU. She was approved for a secure card and we started her on Credit Karma just to watch trends, etc.
Any advice on next steps? Should she get another card? Her cap 1 card has a CL of $200. It's secured. Should she just garden or should she add a few more tradelines and if so what cards would she most likely be approved for with her history/current situation. All collections are at least 2 years old. Thanks for any advice in advance!
09-17-2012 04:22 PM
if she has the funds a second secured card may help. But you may want to let her cap1 card report and see what that does to her scores and see if you get any results with GW letters. With a little luck her score may improve enough to get an unsecured credit card.
09-17-2012 04:27 PM
09-17-2012 07:10 PM
09-17-2012 08:52 PM - edited 09-17-2012 08:53 PM
Welcome to the forums!
Get a second tradeline immediately before increasing the deposit on the C1 card as LS advises (that is a very good suggestion btw, just secondary to number of tradelines).
Beyond GW letters, the biggest thing she can do is start establishing positive payment history, and the sooner that's started the better. The limit is irrelevant on the second revolving tradeline (you can increase the C1 through deposits easily) she just needs another one that reports to all three bureaus. The secured loan route is likely beneficial to her as well if she can afford the extra financial outlay, but that'd be in addition to another secured card and not instead of.
09-17-2012 09:00 PM
+1 On getting a second secured card. It will really help her scores rise.
I would watch her scores and once they go above 620 you might consider applying for a Walmart card.
09-17-2012 09:01 PM
Really, the first thing that she needs to do is deal with the CAs. Getting a pos TL was a good start, and adding to it for a higher CL is a good idea. Usually, I would suggest opening a second TL. But I think she'd be better served working on the CAs. If she can PFD any that aren't paid, that would help. If she'salready paid, then Gw like you're doing.
After working on the CAs, I'd call local CUs and see if anyone will work with her to get a cc - either unsecured or secured. She may not be able to get all of the baddies off for a while. So, after a couple of months, I'd go ahead and get a second CL, by that time, she'll have a good idea of where she stands with getting the baddies off.
Shes lucky to have a friend like you helping her!
09-18-2012 04:34 AM
Thanks everyone for the suggestions. I really want to see her do well credit speaking! I've never been through anything like this personally so its hard, but I always hear that if you have bad credit, deal with it and start working on it right away. She has a long road ahead. I think she will add another tradeline then we will go from there. I think most of what she can get off of her CRs will help, but her short sale will be there for a while and there will be no PFD on that. Thanks again guys for all the help and any additional suggestions please let me know@!!
IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more
FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.