AM CONFUSED!!! DONT KNOW WHERE TO START! PLEASE HELP!

[kellyt]

I am 29 years old and am finally trying to get my credit together. My EQ score is 510. Currently the only open accounts I have are my student loans. All other accounts are collections(mostly medical) or chargeoffs that happened when I was in college. I have 2 judgements from an apartment I used to lease in college and 1 from a personal finance company. Ive read the forums and most people say you should try to get at least an open line of credit(secured credit card or something). I just want to know where and how should I start to clean this mess up. Should I pay off the chargeoffs or just let them stay charged off? Should I pay all the other collections(ie, gas bill, sprint bill)? How can I increase my score? I want to at least be at 550 in 6 mnts and 620 in a year. Any advice that you can give is greatly appreciated. Thanks in advance

[cadavis0609]

My first advice is aim higher than you are right now, you want to be at least 620 in 6 months and 680-700 in a year. The thing that everyone in here is going to want to know is date of last activity on the accounts that are charged off, date of first major delinquency, and the statute of limitations for these accounts in your state. Also, never pay a chargeoff outright, Try a PFD. No deletion, no money. Now you have some leveraging room.

Message Edited by cadavis0609 on 09-18-2007 07:44 AM

[kellyt]

The date of last activity on chargeoffs are 2005. All other collection accounts are medical and some small phone bills and gas bills. The chargeoffs r from credit cards I had in college. My question is, does SOL affect which state the accounts were opened in or which state I live in now?

[Anonymous]

Hi there. You situation sounds just like mine. I became very sick in college and was saddled with some pretty heavy medical bills which cost me my apartment (actually two...) and drove me into bankruptcy.

But you don't want to take that route.

I would sit down and list all your medical creditors (pay off the ones you can first...), then set up appointments with the others and go in an negotiate your payoff, if you can. Let them know you want to pay them but that you're strapped and you're trying to work out solutions with everyone. Just don't let them bully you into something you can't manage. Get everything in writing.

Pay off any collections that are not older than three years. (They are only on your report for seven years..._

On the judgements, if you can't pay them right now, then let them sit until you can pay them. Then, again, try to negotiate a pay off in return for the judgement being vacated. They stay on your report for 10 years.

Get one secured card and make it priority to pay it off every month. Even one good trade line will begin to rebuild your credit, along with the paid off collections. That is the strategy I used. I used a Household Bank and one Orchard card, then got a car loan. But I made it a priority to pay them off each and every month. Now I have four solid credit line..all my collections paid and at least one judgement that will age off my account next year.

You may want to read Mary Hunt's book, "The Complete Cheapskate"...it's great.

I hope that helps. Good luck..and keep in touch with the forum.

[kellyt]

Thanks for the advice everyone, especially Zen.Do you really think its possible for me to get to a score of 620 in 6 months? I mean really?

[Anonymous]

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kellyt wrote:

Thanks for the advice everyone, especially Zen.Do you really think its possible for me to get to a score of 620 in 6 months? I mean really?

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Sorry, I disagree with Zen (not everything Zen said).  Get a PFD before paying.  Otherwise your credit will look the same after you pay.  I made that mistake before I found this forum.  I paid a charge off to zero.  My score stayed the same because that paid account had the same weight as an unpaid account.  It may take more work to try to get a PFD even if you have the money to pay off.  But it is worth it.  Your score will go up fast.  Also get a secured credit card.  Keep its utilization between 1% and 9%. 

Otherwise only use it for a small purchase once every month.   Then pay it down to between 1 and 9 percent. 

Message Edited by monro411 on 09-18-2007 09:27 AM

[Anonymous]

I did, yes. You just need a plan and it will require some real diligence. Shoot for 600 first...then go from there.

My scores reached 648...and a year ago they were at 578.....My lowest was 520, 18 months ago....I had a brief setback yesterday on Experian but a correction on one account is underway and I expect that score will rise again fairly soon. But they certainly aren't where they were.

Decide. Commit. Suceed.

Good luck. Keep in touch.

[Anonymous]

I tried doing PFD on one account and the creditor turned, and did a settled for less than the amount. I don't trust PFD requests because creditors aren't required to honor it.

Paid collections can be as good. It shows you lived up to your responsibilities..and in every case on my credit report, my scores when UP when I paid. The most recent example is a paid collection to Allied Collections. Once it was reported paid, my score bumped seven points. That was a month ago.

[Anonymous]

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Zen wrote:

I tried doing PFD on one account and the creditor turned, and did a settled for less than the amount. I don't trust PFD requests because creditors aren't required to honor it.

Paid collections can be as good. It shows you lived up to your responsibilities..and in every case on my credit report, my scores when UP when I paid. The most recent example is a paid collection to Allied Collections. Once it was reported paid, my score bumped seven points. That was a month ago.

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But if you won a PFD it could increase 100 points.  I have had a few successfully done.  Some required more work with supervisors and managers but they helped.     I would suggest at least to try.

[Tuscani]

Bottom line is "NO PFD, NO PAY".

There is a stipulation in the example letter that states they must delete. If they do not you sue.

Trust me, if they want their money bad enough they will agree to PFD.