To begin with, I'd like to thank everyone for their great advice and insight. The folks on this board are great!!! Nonetheless, I am desparate for help with my credit! Let me explain my situation:
I have recently completed medical school and residency and am now a "full fledged doctor". Unfortunately, during medical school, mostly because of spending long hours studying and working more than 100 hours per week, I was irresponsible with my credit, and managed to have one account (a $20 doctor bill of all things) sent to a collection agency. In addition, I was 30 and 60 days past due on several credit cards multiple times, and this is obviously reflected in my current credit score.
However, over the past month since I have graduated, my salary has increased significantly, and I have been fortunate to pay off most of my credit card debt, which was initially at >$20,000, and is now less than $8000. I am aware that eliminating my credit card debt to < 7% of my max and consistently paying my bills on time is of utmost importance in improving my credit score, but I am still confused about several issues and need your help:
I have several accounts, ranging from previous car loans to GAP cards, which which have not been active or have been paid off for several years. Should I dispute these to have them removed? when I filed the online dispute, I was sent a copy of this to sign and submit to equifax. Should I do this?
In the past 2 months, my salary has gone from $40,000 to well into the six figure range. Will this, along with the fact that I will have eliminated all of my revolving debt in the next 2 months help my score? It seems that if I go from making $40,000 and owing $20,000 in bills to making in the six figure range and owing < $8,000 should help. Does it?
Any other advice on improving my score? My current Equifax score is 551
If you earn more now then you had before, I would assume that you have some cash in the bank. Immediately, go and ask for a secured credit card with your bank ( go and open freee checking accounts at 2 more banks, wamu, bofa, usbank, citi ) Ask them all for a secured visa or master. Put down as much cash as you can. I would put at least $10,000 each if you are at 6 figures salary. Put more if you can. Now in 60 days or less you will have IMPORTANT! credit cards with retail banks and not the usual suspects like cap one, orchard, usa first. use them cards below 10% utilization. check your scores in another 30 or so days and see your score move to the 700's. Put down $50,000 for each card if you can and you will have a $1,500,000 approved mortgage in 12 month by asking for credit line increases and using your cards.
Don't listen to anyone who says you can't. Just go and do it. Nothing to loose to try.
Being a new physician, I get legitimate offers for credit cards with limits in the $20,000 to $100,000+ range on nearly a daily basis. Would it be better to get these traditional unsecured cards rather than secured credit cards for purposes of improving my FICO score?
If you are not telling us all the baddies you have, then my option is fast. But nonetheless you absolutely MUST apply for youre pre-approved cards NOW. Your available credit will jump high, leaving the ammounts on your baddies like peanuts if compaired. Also make sure that your TU, EX, EQ reports reflect your current name change to Dr. and make sure that you have current employer: hospital listed on them too. You will be reviewed no doubt, because of being a Dr and all but this is standard for anyone who has dr in their names so don't even tripp. If your employer checks out then you are all set. recently indians ran a fraud ring putting a Dr. to their names and bogus hospitals on applications and credit reports. Thay ran up huge lines and ran back to india. So natuarlly bankers are more careful now.
call the credit report againcies at their number under disputes, wait untill you get a live person and tell her that your name is incorrect and ask to correct it. same for employment. tell them it's incorrect and here is the correct one: use your current employment info.
NOTE: takes a little longer and harder to get live person on experian. EQuifax and transunion are very fast and courteous. I guess experian sucks because it's a british company. the uk is a breeding ground for scammers and criminals. So expect some abbrasiveness when approaching them. I would just write a ltetter then deal with limeys.