Credit Recovery

[Anonymous]

Hey all, first time poster.

A few years ago my spouse and I spent a lot of money expecting her to start a new job. To make it brief, she got diagnosed with cancer instead and it... sucked.

I was stupid and hid from AMEX. They listed the account as a charge off and ultimately referred the account to GC Services. Even though it had been 2 years, GC Services said if I paid in full they'd reintsate my account. I'm just waiting for that to kick in. it's been a little over a month now.

I've been aggressively paying things off with a new job and big pay increase, and still have a bit to go. I was fortunate enough to secure a low APR personal loan through lending club that's lower than all my interest rates atm and will be paying off quite a bit next week. I've used score estimators but do have some questions on what will happen once things are paid off and my trade line with Amex is made better, as I'm sure they'd have to remove the charge-off info once they reinstate the account?

USAA AMEX - Was maxed out at 4k, now 0 balance.

USAA MC - 3700/6000 balance, will be paid off next week.

NFCU Visa - 14000/15000 balance, will be paid off next week.

Chase Sapphire - Was 5000/5000 balance, balance transferred and now use as daily spender, PIF before statement cuts. (I now travel a lot so pc'd from freedom to sapphire)

Penfed - Opened in January, 4800/5000 balance on it at 0% APR balance transfer for a year.

Citi - Was maxed at 2500, now 0.

Discover - Was maxed at 700, now 0.

Amex Platinum - Was 3K to charge off, paid in full and waiting on reinstatement. Anyone have experience with this process?

Military Star Card - Currently 7500/8800 at 0% APR on the purchases on it for the next 18 months.

All in all, aside from planning to carry the balance on the Penfed card due to 0% APR and just scheduling 12 payments to pay the balance off before the intro rate ends, what could I reasonably expect my scores to do with only 5-10% utilization and that Amex account no longer shows as a charge off? I also have 1 30 day late payment from 2.5 years ago but I've read that it shouldn't be hurting my score too much?

Also, any recommendations on courses of action? I'm very seriously considering closing my Citi and Discover accounts. I also thought about maybe trying to apply for the Unlimited Cash Back card from USAA in a few months and asking to close my two existing cards and moving the credit lines to the new account?

[Anonymous]

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@Anonymous wrote:

Hey all, first time poster.

A few years ago my spouse and I spent a lot of money expecting her to start a new job. To make it brief, she got diagnosed with cancer instead and it... sucked.

I was stupid and hid from AMEX. They listed the account as a charge off and ultimately referred the account to GC Services. Even though it had been 2 years, GC Services said if I paid in full they'd reintsate my account. I'm just waiting for that to kick in. it's been a little over a month now.

I've been aggressively paying things off with a new job and big pay increase, and still have a bit to go. I was fortunate enough to secure a low APR personal loan through lending club that's lower than all my interest rates atm and will be paying off quite a bit next week. I've used score estimators but do have some questions on what will happen once things are paid off and my trade line with Amex is made better, as I'm sure they'd have to remove the charge-off info once they reinstate the account?

USAA AMEX - Was maxed out at 4k, now 0 balance.

USAA MC - 3700/6000 balance, will be paid off next week.

NFCU Visa - 14000/15000 balance, will be paid off next week.

Chase Sapphire - Was 5000/5000 balance, balance transferred and now use as daily spender, PIF before statement cuts. (I now travel a lot so pc'd from freedom to sapphire)

Penfed - Opened in January, 4800/5000 balance on it at 0% APR balance transfer for a year.

Citi - Was maxed at 2500, now 0.

Discover - Was maxed at 700, now 0.

Amex Platinum - Was 3K to charge off, paid in full and waiting on reinstatement. Anyone have experience with this process?

Military Star Card - Currently 7500/8800 at 0% APR on the purchases on it for the next 18 months.

All in all, aside from planning to carry the balance on the Penfed card due to 0% APR and just scheduling 12 payments to pay the balance off before the intro rate ends, what could I reasonably expect my scores to do with only 5-10% utilization and that Amex account no longer shows as a charge off? I also have 1 30 day late payment from 2.5 years ago but I've read that it shouldn't be hurting my score too much?

Also, any recommendations on courses of action? I'm very seriously considering closing my Citi and Discover accounts. I also thought about maybe trying to apply for the Unlimited Cash Back card from USAA in a few months and asking to close my two existing cards and moving the credit lines to the new account?

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Welcome to the forums.

I hope things are better for your wife.  No one can truly predict how much of a score increase you will receive from paying off the debts.  You have not mentioned what your current FICO scores are.  I believe that some have reported the negative tradeline being removed, while others have said that it remained the whole 7 years,  but I could be mistaken.  As for the 30 day late payment, at this point in time it is not impacting your score, but you could still try to get the 30 day late remove by sending a GW letter to the company. 

For FICO scoring purpose, only one of the accounts needs to report a balance  under 10%.  UTI is measured by both overall UTI and UTI on individuals accounts, so  the balance transfers that you are carrying will still impact your score.  If Citi and Discover no longer meet your needs, then there is no reason to keep the open, but given that a lot of people including myself would be thrilled to have both cards (currently blacklisted with Citi and Discover doesn't like me profile for anything other than a secured card), I would reconsider it cause when you get your profile back in shape, you should start to see CLIs from them and they will be generous with you. 

Since you are in with PenFed, then you might consider applying with NFCU when things are better as they known for their generosity.

Good luck and let us know what you decide. 

[Anonymous]

@kaykay65

Thanks for the reply. My scores are wild depending on who I pull and I guess what scoring model they use. They're either in the low 600s or in the 670-ish area for Fico 8? I did prequalify for a mortgage a month ago, but due to timing reasons will have to go through the process again here in another few months.

That sucks that one account out of a dozen can throw utilization off. It's unpalatable to me to pay off the 0% APR balance any faster than necessary to avoid incurring finance charges when it is over. I could have them down to 50% balances by the end of next month, but I would like to hang on to some of that for closing costs should I decide to buy a home.

I do have NFCU, currently my monster with the a 14000/15000 balance! I'll be so glad when I send the payment to pay that sucker off.

You may be right about the Amex reinstatement. I got a call from them today asking if I was still interested. Amex Platinum with $3500/mo in spending power for the first year. The rep told me it would be a new card number and it was safe to destroy my old one. That leads me to believe that they won't use the same TL on my credit reports but add a new one. I was really hoping by some magic that paid charge-off might go away, but I'll take my medicine and move on.

Well, I'm right around 58% total utilization at the moment across all of my accounts, and that should drop to 15% or so this week and allow me to qualify for a better APR on the mortgage I hope!

[Anonymous]

@Anonymous.

I have the Amex platinum and I love it.  As UTI goes down, you will see a scoring boost, but maybe not what you could potentially see with one card reporting.  You gotta to do what you gotta do.  It's always good to have the information for future reference.  When you do get the new card, please let us know if the old tradeline is removed.  The forum is always looking for data points regarding COs and other things.