Hey all first off I'd like to say hi and thanks to the members of this great website. I am a long time lurker here but only recently actually joined the site and forums. I figured that I'd post my story up after about a year of credit rebuilding and the wonderful information from this site that helped me reach my goals. It's a bit long so heads up!
First off it's been almost exactly a year to the date that I first decided to take the steps of rebuilding my credit in order to be able to buy my first house for my wife and I. I also have to give a lot of credit to her help and motivation(she has near perfect credit) but the majority of the tips and advice I got was from searching these forums.
A little backstory, I used to have great credit until I hit my mid 20's and made a lot of big mistakes. First it was too much credit utilization and then I fell into the trap of getting a vehicle loan that was way more than I was able to afford. It wasn't long before I fell behind on payments on my credit cards while I struggled to pay rent, bills, and the car payment. The one saving grace was that no matter what I kept paying on my car note but I neglected a lot of cards. I was able to finally pay off the big car loan a few years ago. That was a great feeling! Then another big hit came when I could no longer defer my student loans and I fell into default not only with credit cards, but with Ed Financial.
I got so behind that I just gave up and let the collections build up until I was buried in letters and phone calls all hours of the day. My credit at one point was in the high 400s. This was all around 2006-2007. I basically left all of this on the backburner and neglected to take care of any of it until last year when my wife put her foot down and basically told me to man up and take care of my debts. We had been renting several years, and were wanting to buy a house. My credit was so terrible that everything was in her name and she wasn't happy with that, and neither was I.
So, last June 2012 I started searching for ways to repair my credit and get my debts taken care of and clearing my name. I found this website by chance and did a ton of research. I pulled my credit score from here and it was a dismal 550. I began by contacting creditors and collection agencies looking to make deals to pay off my debts in full while clearing the negatives off of my report. It was a long battle and process. Some of the creditors were helpful and some weren't. I had some success getting many negatives deleted or updated to show paid in full. I worked out a deal with Ed Financial to get out of default and clear off the bads from my report as well.
Within a month I had about a 580 score and decided to try and get a credit card opened in my name so I could start rebuilding with a revolving debt. The only thing I could get was a Capitol One Secured card with a limit of $200. But I took that card, and used it for small purchases every month and paid it off in full every month. After a few months they increased my CL to $300. I continued cleaning up my report at this time as well, mainly sending GW letters, making phone calls asking for mercy and to my surprise many companies updated my report in a more positive light.
By the end of 2012 I was in the low 600s and was able to apply and get approved for a Barclay's NFL rewards card with a $1000 limit, my first unsecured card in years. I continued making small purchases on these cards, while paying them off every month. A few more months went by and in March of this year I was able to contact Capitol One about going with an unsecured card and to my surprise they approved me for a nice Cash Rewards Platinum with 0% APR for one year on purchases and balance transfers. I had a mid 600s score by then, around 650s.
In May of this year we decided to start looking for houses. We went throught the preapproval process through a local mortgage company and when the pulled my scores I was in the 680s at that point. We were jointly approved and closed on the house on June 14th of this year and bought our first house! At that point my scores were nearly 700. We got a great rate at 3.5% FHA loan. We could have gone conventional based on our scores, but didn't have 20% down to avoid the PMI so chose the FHA route. All in all it went very smoothly and we actually closed early, and in less than a month. Roughly 27 days from contract signed with seller to having keys in our hands.
Fast forward to today and I was approved for my first American Express card. I got an instant approval on the Green card because I wanted to get my foot in the door with them and then apply for the BCE card. I am abosultely ecstatic. If you would have told me a year ago I'd be in this position with my credit and I would have laughed. But, with the help of these forums and some hard work I was able to raise my scores nearly 150 points in one years time. I've also learned to become incredibly responsible with my credit and pay cards off monthly.
Anyways, that's the long summary. I can give more details on some things if needed but I just wanted to let other folks out there that were like me know that there is hope and you can turn things around. Thanks again!
My Goal is to buy a home...
I have a lot of stuff on my report that is different on each one so I am working on getting that corrected.
just dont know where to start. what was the first thing that you did?
I know exactly what you're going through work_n_progress. I started by reading and searching a lot of posts here that had anything to do with what my particular situation warrented. I started with contacting the collection companies and asking for a pay for delete. Meaning I offered to pay off the balance in full if they'd delete the collection from my account. Some agreed, some didn't but in the end I still paid them ALL off. I didn't want any current collections on my account. In cases where the original creditor still had the account I called and mailed letters asking for goodwill deletions of derogatories and same thing, some did some didn't.
Once I got any negatives resolved or at least paid off, I started by applying for a secured Capitol One card so I could start establishing new credit again. Once you take care of old nagatives and can start establishing new credit you'll be surprised at how your credit report starts looking good.
@Thammer I have been reading everything I could, I found out about a secured card that is reported to the c.b's but they don't run your credit when you apply...it's called "open sky" I checked for reviews and I decided to apply for it. I am now researching letters to send in so that I can request things that aren't correct to be verified and I am also working on getting a lien vacated...and I was just looking now to see if there is a way to clear inquiries... but baby
steps because I know this can't be done in one day...I was also checking to see if anyone has been able to get a paid repossession listed differently or even have the late days cleared...(still looking), but thank you for replying, haven't met that many friendly people on here...(I'm a newbie didn't know the rules )
That is awesome. For the last 6 months or so, i have begun to seriously work towards fixing my credit. I have had a good last 3-4 months and my understanding of how some things work has improved. I have a few things that are not due to remove until 2015 that I can not afford to do a "pay for delete" on. But I am hoping to be in the 700 range in the next 6 to 9 months.
Awesome story! I am pretty much in the same boat as you were (score below 500 as we speak) and I feel like I can never make it any better.
I'd be ecstatic if my score was over 600 a year from now! Thanks for the inspiration!
Keep up the good work!!!!!