Help! New and not sure where to start!

[takingcontrol]

Hello everyone, I'm new here and my husband and I are trying to get our bad credit behind us.  We had a major move 7 years ago that we financed with credit cards (had to move due to loss of jobs for both of us) and when we got settled couldn't pay the credit cards, gave one vehicle up for voluntary reposession and another vehicle gave up voluntarily almost a year later.  Then in 2003 we had to go delinquent on a car that the engine blew up, it's part of a class action but still not having paid the car is on our credit.  We couldn't afford that large payment (it was at 24% interest) and another though and had no choice, it was that or not eat.  It's been quite the struggle to get back on our feet and make ends meet over the years.  But we are getting there.  We've had some major medical expenses the last couple of years causing some unpaid medical bills to pile up and a few miscellaneous things here and there.  So fast forward to today, we are in a great position to start working on our credit and moving forward but we have no idea where to start and what will be the best help.  We had paid a company $1000 to supposedly help us but they wrote some letters that we had to mail and they really didn't do anything.  So here we sit, I only pulled our Equifax scores through the SW here as of now and mine is 496 and husbands is 480 so we need to do some serious work.

What's the best place to start, we have some unpaid collections that I can pay off but is that the best place to start.  We have a total of I think it said $29k in unpaid accounts according to SW and most of that is two of the cars we gave up.  That's a huge chunk of change so it's a bit discouraging.  Do we call the people holding the car collections and set up a payment arrangement or pay our little collections off first and attempt to do pay for deletions on them?  We have no credit cards, would it help to get a couple unsecured credit cards to start boosting the score?  Do you have to charge and pay on them to be effective or is just having the available credit enough?  I'm sorry, so many questions. I've been reading here and getting great information, now I just need to know where to start.  Thank you everyone for your advice!

P.S. We would love to purchase a house in two years and are hoping to get these scores up, is that a realistic goal?

Thanks!

12/19/2007 - EQ 496

Message Edited by takingcontrol on 12-19-2007 07:20 AM

[Anonymous]

Hi takingcontrol, welcome to the forum. You will find a wealth of information with many very knowledgeable people here to help you regain your credit health.

Sorry to hear of your difficulties. Thank you for sharing and "bearing your soul". I want you to know that you are not alone. Many of us have been in similar situation. We will work on this together, along with all the kind people here.

And yes there is hope. It will take time, and a lot of effort to be sure.

You can repair your own credit on your own. Many find the debt repair company's don't do as they claim, as you did.

The best place to start? Asking questions is a good first step. IMO, joining a credit union could be beneficial for you. Establish a relationship with them. Start a savings account, etc. After a period of time, apply for a credit card.

To be honest with you, with an EQ score of 498, not much is out there unless it's a secured card.

Can you list what you have in collections that is showing on your cr? We need detailed information. We(you and I, and all of us) need to determine who exactly owns the collections...the original creditor(OC) or a collection agency(CA), as the approach is somewhat different.

NEVER speak to a CA on the phone, and DO NOT make any committments until you know EXACTLY what is going on, on a particular account.

This will be just the first of a series of exchanges you will have with everybody here. And you have to start somewhere.

Others will be chiming in to offer their opinions, but a good place to start is to give us detailed info as to where you stand now.

[fused]

Hi takingcontrol! Have you read Tuscani's credit scoring 101 thread?

http://ficoforums.myfico.com/fico/board/message?board.id=ficoscoring&thread.id=2654

[Anonymous]

Here is a thought. Although I typically don't like it when people avoid paying debts due to SOLs (Statute Of Limitations ... get used to the Acronyms), it might be in your best interest since it sounds like some of your derogatory accounts are older. It may delay your dream of homeownership by a couple more years though (or not at all).

All I am recommending is for you to look through these threads and find ones were people talk about SOLs and the 7 year FICO removal policy on tradelines (TLs). Pretty much rather than investing all of your money into these older accounts, you may want to look at more recent bad accounts (they tend to have the most effect on your score) and knock them out first. If by the time you are able to look at the older ones they haven't already fallen off of your report, you will then have to come up with some strategy to alleviate their impact on your credit score.

A basic idea of SOLs and 7 years for items to "drop" off of your report is as follows: An account went delinquent 6 years ago. The SOL in a particular state for this type of acccount is 5 years. Legally you can't be sued for this debt. After a year and a half (they get an extra 6 months on top of the 7 years), the Original Creditor (OC) cannot report this on your credit report (CR) and the credit reporting agencies (CRAs) tend to automatically remove them. This is real basic and there are other factors to account for but that is the beauty of this forum because whatever it is, someone has been there.

Of course this is all premature, as Sylvia said, we have to see the details of what is in your report so that you can develop a strategy for improving your credit that finds a balance between "being cost effective" and "taking as little time as possible to acheive."

Good luck.

[Anonymous]

Welcome taking,  First I will give you threads that might help.

This is for newbies and has the abbrevs that we all use along with the freq.requested thread.

http://ficoforums.myfico.com/fico/board/message?board.id=generalcredit&thread.id=38534

This will tell you the differance between CRTP and SOL

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

SOL is set by each state. If you received credit in 1 state and then moved to another, You will need to know each state. IF a creditor wants to file a lawsuit they may go by either SOL

Example:

I lived in Fl. and took out a CC with Cap1.    I moved to Ct.   I stopped paying in 2003.

SOL in Fl. is 4 years   BUT in Ct. it is 6 years.........They have the right to file suit in either state. BUT no later then  6 years IF they file in Ct.  After that, I still owe but they can not sue.

Simple SOL

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

Ask as many ?? as you need at any time!!

GL

[takingcontrol]

Thank you everyone for the wonderful responses, I feel relieved to know others have been there and have found light at the end of the tunnel.  I'll pop on tomorrow and post specifics, I have to dig out the reports again.  The reports I  have are a few months old, what's the best place to get all 3 reports to start with a clean slate from today on it?  I know you can pull them here but I can't figure out if they are the true full report (like one you get when you go to a mortgage broker or auto loan place etc.)?  One problem we have is that we have so many duplicates on our report and it's hard to tell what belongs and doesn't belong there.  Anyways, it'll make more sense when I have specifics so I'll post more tomorrow.  Thanks for all the links as well, I've read a few of them but I'm off to do more reading!

[Anonymous]

keep in mind that when a CC is a CO it can be reported from the OC ans at the same time by a CA if it has been assigned to them or bought.  These are not dup.reporting.

[BBYGRL]

Good for you Takingcontrol! You will find no judgement here - just support, encouragement and a wealth of information that will help you regain control of your credit.

I would suggest pulling all three of your FICO scores from the CRAs (TU, EQ, EX) because they tend to report different information. You should list all of the derogatory TLs from all of the reports before you decide what your next step will be.

We wish you luck!  Please keep us posted on your progress.