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Big Mess

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Anonymous
Not applicable

Big Mess

Now that I have a job, I'm trying to clear up my credit. My current score is 570. Obviously, my student loans and tax leins aren't helping in the slightest. I'm working on the leins and plan on repaying my student loans as soon as the grace period ends. Hopefully, by that point, my taxes will be cleared or dealt with. The rest is just a big giant mess that I can't figure out. It isn't a lot of money - the most I owe on one credit card is $1500, but it is a lot when you don't make that much money. I'm thinking of letting a lot of it go and focus more on building it up instead of paying back. Any thoughts?

Message 1 of 19
18 REPLIES 18
Anonymous
Not applicable

Re: Big Mess

I would definitely get some good revolving credit on your report by using secured credit cards if necessary. 

 

I was in a similar situation - in fact, in March of 2016 my score was 601... by using the credit cards wisely I have slowly brought it up to a now 682.  I have some pitfalls along the way and i'm more than happy to share them so that you can learn from my mistakes.  (i also applied for a small car loan that was easy on my budget in May, which brought my total # of current accounts to 3. 

 

I applied for a credit card with my bank (Bank of america) In August of 2015 and was offered a secured card.  I took $300 and deposited it onto the card for a $300 credit limit.  Each month I would charge just a small amount (between $20-$25) and let it on the card for the reporting date, being sure to make any payment that was due in the meantime. After 12 months of on time payments, they released my security deposit back to me and increased my credit line to $400.  They have since raised my credit line to $900. 

 

I also applied to Open Sky credit card.  This card does not pull a credit report but does verify your identity.  I deposited $200.  This card is not the best, but it has served me well. It has an annual fee which I don't like- but in all honesty- the $59 per year or whatever it is - is well worth the value of helping my credit.  After 12 months of on time payments they returned my  deposit to me.  They have not offered a credit line increase, which is fine with me. 

 

PITFALLS OF CARDS--- a couple times, my budget would get out of control.  I would end up charging stuff on the card and a higher balance was on the card when it reported to the credit bureau.  That killed my score- I literally cried the one time.  Then one time, I kept a small balance on ($15) the cards and because the balance was the same as the prior month my score fell. it assumed I wasn't using them.  ugh.  MY ADVICE OVERALL- I'd do these cards again in a heartbeat.  KNOW when they report to the bureaus and live and die by that date.  COMMIT to being actively involved in your budget.  If you ever feel like hiding from it, that means something could go very wrong and you NEED to be on top of it.  Keep your credit card usage to 9% or below.  For me this has made a huge impact. 

 

Also - I use credit check total as a credit monitoring service.  I still subscribe to it.  It has helped me immensley... I haven't used others, so i can't compare- but I have liked my experience with credit check total. 

 

SO I guess that's the long answer to your question---- I would indeed hold off on paying them just long enough to establish some secured cards so that your credit report has new, good information reporting to it.  Then I would return to paying them down.  

 

=)  GOOD LUCK!

Message 2 of 19
stargazer25
Regular Contributor

Re: Big Mess

Can you give us more details of everything so we can give proper advice?

Starting Scores: September 2015 minus 500 across the board
Current Scores: October 2017 EQ: 715 TU: 710 EX: 716
In My Wallet:
Cap1 QS: $4.8K - AMEX BCP: $4.2K - Old Navy Visa: $7K - Nordstrom $3.8K - VS $500 (FTW!)
BofA AU: $12K AMEX AU: $25K
Business: AMEX BCP $15K
Message 3 of 19
Anonymous
Not applicable

Re: Big Mess

What more do you want to know?

Message 4 of 19
Anonymous
Not applicable

Re: Big Mess

I just got approved for a secure credit card from Capital One. It has pretty good reviews. For a deposit of fifty bucks, they will give me $200 of credit. According to their information, if I make five consective payments, they will raise the credit. This how my parents repaired the credit after a bankruptcy. My main beef is that I don't want to pay anything to creditors and have it not removed from my credit report. Right now, I'm going to start with those tax liens and go from there. One step at a time.

Message 5 of 19
stargazer25
Regular Contributor

Re: Big Mess

All accounts that are opened what balance vs. credit limit, charge offs, delinquencies, lates.

Starting Scores: September 2015 minus 500 across the board
Current Scores: October 2017 EQ: 715 TU: 710 EX: 716
In My Wallet:
Cap1 QS: $4.8K - AMEX BCP: $4.2K - Old Navy Visa: $7K - Nordstrom $3.8K - VS $500 (FTW!)
BofA AU: $12K AMEX AU: $25K
Business: AMEX BCP $15K
Message 6 of 19
Anonymous
Not applicable

Re: Big Mess

I think your building up is going to be limited if you don't pay back.  When you say "letting a lot go", do you mean not paying current bills?  I am pretty new here, but when people ask for more details they usually want to know who and how much you owe.  It helps them gives suggestions.

Message 7 of 19
rmduhon
Valued Contributor

Re: Big Mess

Are any of the baddies updating monthly? If so it's keeping your scores down. Paying them (even if they aren't removed) will stop the updating and allow your scores to recover faster.
Message 8 of 19
Anonymous
Not applicable

Re: Big Mess

You're talking about ten pages worth of info. I have my credit reports, but they are a giant mess. There are entries that are on there multiple times. I tried making sense of it a couple of years ago and couldn't. It is even more confusing now. One thing that I think is hurting me are my parent's AMEX and Macys card that are tied to my account. The balances are very high, but I don't know if they are hurting me or helping me, as they make all their payments on time.

Message 9 of 19
Anonymous
Not applicable

Re: Big Mess

EM71 - I don't have any active credit cards myself. The only ones that are shown as being active are my parent's Macys and AMEX card. All of my own personal cards have been charged off. This Capital One Secure Card is the first credit card I've had in four years. I didn't feel comfortable getting a card when I was unemployed, let alone qualify for it. Everything I'm referring to has been charged off.

Message 10 of 19
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