Greetings all. I love the amount of information available on this site and the forums. I've spent hours perusing the available info and it's been quite enlightening. However, since I'm new to all of this, I'd like to ask for advice or at least some confirmation that I'm thinking about these things correctly.
I've got two main debts that I'm working on paying down. If I tighten up my financial belt, I can make some serious progress on paying the debts down.
The first thing that is always listed on the "key factors that adversely affected your credit score" is a public record for child support. I've read several posts and pages on myfico.com that say that child support isn't considered in the FICO score. However, since this line is always present, it seems that my public record for child support is indeed affecting my score.
Just to clarify, I am paying child support, current and arrears, so I'm not asking if I "should" pay the past-due child support, that's obvious.
I also have a student loan, that shows up as five loans(different loans given at separate times, i.e., school quarters). It was in deferment/forebearance for a while, but I've been paying on the loan for approximately a year now. The balances are higher than the "limit" due the interest gained on the unsub'd loans in school and then gained on both unsub/sub loans while in forebearance.
That's the background on my two main things I'm looking at. So where I'm looking for advice/confirmation is:
The student loan is my only installment account. So it seems in terms of my score, I want it to stay open to continue in order to have the credit mix (revolving/installment) as well as to continue to establish a longer positive payment record with those loans. The drawback is that the loans are all charging 2.83% interest. So paying the loans down faster will save me money in the long run.
The child support arrears are going to look bad no matter what in terms of my credit, besides the ethical obligations(which as mentioned above, I am paying those, just considering what debt to accelerate). However, the arrears carry no interest, so the amount is only dropping as I make my current payments on the owed amount.
Perhaps what I'm asking is more "financial advice", but I was hoping that perhaps someone could at least confirm that in terms of FICO I'm looking at these things correctly. If someone can an opinion on which to pay down more aggressively, I'd apppreciate it.
Thanks!
Or another way to look at it may be.............a judgement is a judgement period. What the judgemnt is from may be irrelevant. I wonder if they just dont take child support payments into consideration but once you have a negative public record it doesnt matter what its from.
Just playing the devils advocate trying to look at it from another perspective.
Good luck!
Starting Score: 500(06/11)Thank you everyone for your input, it's much appreciated as I try to free myself from past mistakes. The emotional and physical effects from those times have long subsided, but the financial impact keeps its grip on me.
MarineVietVet, I have read what the administrator and the page on "What's not in your FICO score" had said regarding child support. However, the first thing always listed in the "key things adversely affecting your score"—which as I understand is listed in descending order of effect on score—is the public record (I only have one, it's not listed as a judgement either) for my child support. Is this something that I should point out to the CRA? Perhaps they're not properly recognizing it as child support?
Thanks!