Can anyone explain this mess to us?? (newbie alert!)

[Anonymous]

Hi all, I need some advice and help!! Today my DH and I pulled our credit reports. The news we received was not at all what we hoped for. We worked our tails off learning how to budget responsibly in 2007, this included paying bills on time, etc. We were thinking that it was a sure deal our FICO improved. Um... no, they did not.

so........ here's the basics.

DH: TU 576/EQ 550/EXP 576.. No past due amounts reported on all 3, install balance on all 3 is +/- $44843 (all student loans).

ME: TU: 555/EQ 588/EXP 540
Past due: TU $3247/EQ $4055/EXP $3532
Install balance on all 3 is +/- $42830 (includes student loans and 1 car payment).

We have no credit cards. We had a total of 3 in the last 10 years, all which were charged off thanks to lack of responsibility in our younger days. woops. Currently all that is reported is the student loans and my car payment. We have several old accounts still in collection and some that have been paid but are still listed on the reports as PIF or otherwise.

We are planning to buy a house (when possible and scores allow) and also have a plan in place and are working at becoming completely debt free. If we maintain our plan we should be totally out of debt (somewhere around 97k with SL's) in 2010. However, we would like to buy a house in 2009.

We need some help figuring out where to start. The lender we chatted with last year said we should not apply for loans until we reach at least 675. He was very straightforward with us and we trust that he wasn't ripping us off so we are working towards at least that. I don't even have the slightest idea where to start in fixing these scores.

We're slated to pay off several of the past due collections this month alone ($1400) but I don't even know if that makes a different in the scores or not. If someone could give us some much needed advice, tell us where to start, or how to start, that would be great. We are lost!

Thanks,
AM

p.s. for some reason when I post, it seems to post twice everytime. Not sure why that is happening. sigh......

Message Edited by am911 on 01-08-2008 11:26 PM

[ozgirl]

I am no expert; however with the help of these boards my DH and I have managed to raise each of our individual scores by about 100 points with each CRA since July!

So, the first thing I would suggest is to read all of the Credit 101 etc... there is a wealth of information there. In fact, read as much as you can on all of the different boards as you will gain insight into how the credit game really works.

The first and most important thing I have learned is that you NEED to have some credit cards. Like you we were under the mistaken notion that it was good to live without relying on credit, pay cash for everything and that by simply paying down old debt we would be traveling down the yellow brick road to perfect credit scores. WRONG!

It looked to me like one of you (DH) is in better shape than the other (DH has no past due amounts etc... yes?) So maybe he can apply for credit with Orchard, or Cap1 etc..then start using the card for just one or two things (small!) each month and make sure it is paid off. You don't have to carry balances--just show that you can use a card responsibly. That is what I did and it worked! But, that is just one step in the process!

There is hope! But you really need to sit down and READ..READ... READ these boards and learn about the credit game. Get copies of all of your credit reports.

Good luck...

[cobra19]

agree with oz..........you need to obtain some credi cards. In addition to the suggestions above, I would recommend you contact your local credit union. CU's are generally more liberal with their credit lines.

And...............keep those car payments current.  

[sunrise]

BEFORE you pay your collections....try to PFD!!!  Also, try GW's.

 As stated above, get some CC's..you may have to settle for secured, but DO IT!!!  You will see scores rise steadily if you follow the advice in these forums. (Use the Credit Card section for this)

If you don't understand these abbreviations...use the stickies above under "Guide to Common Abbrev."

Everyone here will try their best to help.

I myself have been helped tremendously!!  In the last 2 months my scores have gone up on average 80 points!!

For mortgage questions...go to the mortgage section....ShanetheMortgageMan is brilliant...he will help you with advice on getting ready/approved for a mortgage.

Best of Luck!!

[bamagirl1]

i agree with all the posters all the info here is a wealth of knowledge and the people here know just about all there is to know in some shape or form about credit. I'm new here so I'm just starting to work on mine, but I have read others in same position as you and were very successful in raising scores

[Anonymous]

Thanks everyone for the replies. We will definitely be reading the credit 101 section to get some more info.

I have to say I was actually surprised that my report showed past due amounts at all. I have never been late on my car and my SL is current and in the past has been in forbearance state. The past due amount are actually 2 collections that are being reported as open accounts or something. It was not what I expected to see at all. Additionally... I'm not sure Orchard or those other subprimers will be willing to lend DH a card, thats who he defaulted on in the past. My only CC ever was a Discover that I got when I was 18 and it was closed sometime in 2001 or 2002.

Let my reading begin!

[cobra19]

am................how long ago did he default on his Orchard card?  My sister defaulted on her Orchard card in 2004, in fact it still shows up on her report as a collection. And......are you ready for this......they just approved her for a new card. New account number, new everything. 

[Anonymous]

Hi am911, welcome to the forum.

This thread is for newbies & is full of info. that will help.  Always ask as many question as you need!!!

http://ficoforums.myfico.com/fico/board/message?board.id=generalcredit&message.id=4328

IMO everyone need to know what their SOL is. This is set by each state and it is when any creditor can file a lawsuit.

simple SOL

http://www.bankrate.com/brm/news/cc/20040116b2.asp?caret=8

CRTP and SOL

http://ficoforums.myfico.com/fico/board/message?board.id=generalcredit&thread.id=17466

Look at your TU and EX  CR...it will tell you the DOFD or DOLA. (EQ uses DOLA)......Pay attention to the OCs as they are the ones that set the DOFD-DOLA.....it says something like....will remain on CR until (date).

When a CA is assigned or bought a debt they can NOT change that date. This is also the dates used in SOL.

Paying off collections will help your scores BUT only if they are PFD (deleted)

NEVER pay a collection without a PFD.......NEVER talk to a CA on the phone...NEVER sign a DV letter!!!!

The date that a CA shows as -date opened- means nothing!

List all you collections here  and include  the name of the OC    Date of DOFD or DOLA      name of the CA (if there is one)

My advice is to always DV any CA  before sending a PFD.  Remember that they MUST answer within 30 days or stop reporting!

When it comes to scores CC count more then any other loans!  Before applying for any CC  clean up your CR first. It will not happen over night BUT it is worth it!

Message Edited by HappyDays on 01-09-2008 02:15 PM