Another Fresh Start

[SuperBMR]

Hello.  I joined back in November 2012 and made a post stating I wanted to start fresh.  Well it still took me another year before I actually started taking action.  I was so afraid to confront the debts I accumulated and had delusional ideas it would just disappear.  Throughout the year I settled a few accounts that raised my score from the low 400's to 569 as of 8 January.  This year I am looking to break into the 700's.  I have been reconing various post over the past month and today I felt confident enough to share my story and truly seek advice.

Currently I am accelerating payments on my car loan so I can free up another $600 to add to my snowball payment.  Today I sent a Servicemembers Civil Relief Act request to my lien holder requesting to lower my interest rate from 17.9 to 6 percent.  If this is accepted (finger crossed).  I should have my truck paid off by March.  If not, if won't be complete until June.  

I have 8 account in collections.  I am currently waiting on responses from the credit bureau because a couple I believed were already settled.  I have about two weeks left before I should start receiving responses.  But all together with these collections I owe around $7,000.  

In December 2013, I received approval for an NFCU Secured and Cap One Secured to help start building my credit while I settle the collection accounts.  I apologize if I seem all over but I wanted to ensure I give you the full picture.  

Please provide any advice you believe will help me reach the 700's or close to it by next year.  Aside for making payments on time and keeping my balances low, what other techniques should I keep in mind for building up my credit.

[LadyLeah]

I'm new so I can't really offer any advice, but I do want to offer my support and congratulations on taking steps in the right direction. Plus, a huge congrats on the work you did last year to raise your score over 100 pts!!! That's pretty huge! Best wishes!

[SuperBMR]

@LadyLeah, thank you for the support.

[otter69]

I hate being the bearer of bad news, but it probably isn't possible for you to reach 700 in a year. If you can convince the 8 creditors of the accounts in collection to remove for full payment and/or they are over 6 years old meaning they will drop off within the year... than maybe it is possible. Settling an account in collection doesn't make it go away; although paying does help somewhat it will still show 7 years from when it became delinquent. 

The good news is that with time and doing the right things, you're score will get better. At some point, your collections will be old enough that they will have less of an impact and then they will drop off. But it will take time. Within a year or two you will be able to break into the mid or upper 600's and while you won't be able to reach 700 yet, you will still be able to get good credit, if not the best credit. I don't know the  FICO algorithm, but I have seen enough scores and seen enough research to know that 700 is no-man's land for people with collections... maybe the rare person with an old collection about to drop off, but not eight.

Don't mean to discourage you, but better to know that going in then to find out latter and abandon your efforts after hard work. Do try to learn as much as you can, keep your credit blemish-free from here on out and keep your head up.

[SuperBMR]

Thank you for input. Your reply forced me take due diligence in removing those collections instead of going with the flow.

[Anonymous]

Yes, paying for the collections of hoping some of them are out of SOL in your state will help.

Getting them removed should be a priority so your score can improve

[SuperBMR]

It has been a long year, so I will provide a quick update. I have been able to remove five of the eight collection accounts and will be negiotating two more once I return home. The Servicemembers Civil Relief Act request I submitted was denied but I used money from savings to pay off the truck in April. As well as, two other personnel loans.

I received an approval for VS for $300 and Amazon for $600 in February. My CapOne Secure received a CLI of $300 in April plus I was approved for a Platinum and QuickSilver for $500 each last month. My NavyFed has remained the same, and currently I rotate monthly which card is my primary and PIF at the end of the statement cycle.

I am working on establishing an account on myFICO but currently CapOne shows my TU score as 619.