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New Member
Posts: 6
Registered: ‎08-21-2007
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Trying to Recover From a Difficult Past...

[ Edited ]
I have an abysmal credit history. One year ago, my score was 530. I had 7 accounts, 6 of which were in bad standing, some of which went into collections. I had a student loan almost default (over 90 days late) and $12,000 worth of credit card debt. I required consolidation and nearly declared bankruptcy.

Rather than spare you the details, I'll tell you where I am now. I have three open accounts, all in good standing. Two are student loans in the amount of $12,600 total. The third account is a new credit card account (8 months old or so)in good standing, with a $493 balance (out of $500 limit.) I have been regularly paying more than the minimum balance due on all of these accounts.

According to Experian, my current credit score is 608, "Not Good" but 78 points higher than it was last year. Obviously I want my score to be awesome, and I've worked very hard to improve it.

So, um... what now?

I think the thing that confuses me the most is the student loans. I live in a dual-income household with my husband, and if all goes according to plan, within the next year I will be able to pay off at least half of my current student loan debt, possibly all of it (before going on to grad school and, inevitably, accruing some more...)

I'm not sure how credit lenders look at student loans. Are they considered any different than credit card accounts? I can't really do anything about having such large amounts of debt for the sake of my education, other than pay it off as quickly as possible. Do the student loans damage my credit score, or is this just lingering from the abysmal payment history I have? If I pay the loans down, even by 50%, will my credit improve substantially? (Neither of the loan accounts in question have ever had a single late payment... in fact, one is still in deferment until October.)

What can I do, from here, to improve my credit score? This is very important to me. Oh, and if it's relevant, I'm 24 years old.

Message Edited by GreenTara on 08-21-2007 04:06 PM

Message Edited by GreenTara on 08-21-2007 04:07 PM
Moderator Emeritus
Posts: 16,374
Registered: ‎03-12-2007
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Re: Trying to Recover From a Difficult Past...

Hi There! I would begin by reading the credit scoring 101 thread below. Good Stuff!
 
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
New Member
Posts: 6
Registered: ‎08-21-2007
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Re: Trying to Recover From a Difficult Past...

Thanks very much, that was an extremely helpful link. It looks like I made a mistake by closing those accounts once I paid them off. I am still confused about Student Loans though. Is UTIL calculated on those? Does the balance amount matter?
Super Contributor
Posts: 8,177
Registered: ‎03-25-2007
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Re: Trying to Recover From a Difficult Past...



fused111 wrote:
Hi There! I would begin by reading the credit scoring 101 thread below. Good Stuff!
 


Can we make it a requirement for posting that one reads CreditScoring 101 first?  :smileyvery-happy:
The slide from grace is really more like gliding
And I've found the trick is not to stop the sliding
But to find a graceful way of staying slid
Moderator Emeritus
Posts: 16,374
Registered: ‎03-12-2007
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Re: Trying to Recover From a Difficult Past...



MidnightVoice wrote:


fused111 wrote:
Hi There! I would begin by reading the credit scoring 101 thread below. Good Stuff!
 


Can we make it a requirement for posting that one reads CreditScoring 101 first?  :smileyvery-happy:


I have thought about this! Let me go ask the silverback!:smileyvery-happy:
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
New Member
Posts: 6
Registered: ‎08-21-2007
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Re: Trying to Recover From a Difficult Past...

Sorry, don't mean to be a lame n00b. :smileywink:
Moderator Emeritus
Posts: 16,374
Registered: ‎03-12-2007
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Re: Trying to Recover From a Difficult Past...



GreenTara wrote:
Thanks very much, that was an extremely helpful link. It looks like I made a mistake by closing those accounts once I paid them off. I am still confused about Student Loans though. Is UTIL calculated on those? Does the balance amount matter?

There are util% calculations on installment loans (excluding mortgages) such as autos, personal and student loans but hey carry little weight. Just make sure you pay your installment loans on time, never be late. Revolving util% calculations carry considerably more weight. I would much rather have an installment loan reporting 80% of the original balance as still unpaid (never late though) as opposed to 80% util on my CCs. The later will tank your scores!
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
New Member
Posts: 6
Registered: ‎08-21-2007
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Re: Trying to Recover From a Difficult Past...

In other words, I need to pay down that credit card. Thanks fused111, I really appreciate it.
Moderator Emeritus
Posts: 16,374
Registered: ‎03-12-2007
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Re: Trying to Recover From a Difficult Past...



GreenTara wrote:
In other words, I need to pay down that credit card. Thanks fused111, I really appreciate it.

For max FICO points keep your CC util 1-9%.
Credit Profile -
FICO 08 Scores (03-26-2015): EQ 814, EX 817, TU 822
All three scores were 850. Lost points for not having an open installment TL. So, BE WARNED!!!!!
Credit History: 26 years ~ AAoA: 13 years ~ Util: 1% ~ Inqs: EX 1, EQ 1

Credit Cards: Amex BCP ~ Amex Clear ~ Amex Platinum ~ Barclay Ring Mastercard ~ Chase Freedom Visa ~ CITI Dividend Platinum World Mastercard ~ FIA Fidelity Investment Platinum Visa ~ First Hawaiian Bank Gold Visa
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