Gearing up for Credit Repair efforts - Could use some advice.

[Anonymous]

Good day myFico community!

I have been anonymously browsing the forums for a few weeks now to try to get ideas on how to increase my rating.  I have found a few short comings in my own credit profile that I am finding it very challenging in resolving - I could use some advice or "this is my story" discussions to help me decide how to tackle this beast. 

Currently, per Credit Karma, my TransUnion score is 528; I've found that my Experian is somewhere in the 570's recently when I was denied a request to consolidate my (3) cards into (1) card.

Revolving:

Chase Slate Visa - $500/limit - $495 balance - Reports to CBRU on 1st of each month - Given the 27% rate, won't reduce

CreditOne Visa - $500/limit - $545 balance - Reports to CBRU on 1st of each month - 21.99%

USF FCU Visa - $500 Limit - $100 balance - Reports to CBRU on 22nd of each month - 19.99%

Macys - $100 limit (oldest account) - $50 balance

Fixed Loans:

USF FCU Auto - $9,800 (orig. $13,200) - 8.54% (set to pay off

USF FCU Personal - $440 (orig. $1000) - 11.99% (paid off by Apr 2015)

Collections (all medical):

3 active, totalling $772

Verizon FIOS - $250

Verizon Wireless - $900 (stuck me with two cancellation charges and two months additonal service charges which I believe shouldn't be there.)

I think this is what would make my credit profile look better and raise my score significantly:

(1) $1,500 - $2,000 Visa/MC and getting rid of my Chase, CreditOne and USF FCU Visa's.

--> Goal would be to cover my basic living expenses (Utilities, Gas, Food, Entertainment) and make significant payments 2x a month to this card.

--> trying to spreadout payments to three credit cards seems like a revolving door of bad decisions and in my opinion, because I am struggling to "report" low balances because of the time I pay them to the time they report, I've already paid bills, bought food, gas, etc. that bumps up those balances when reporting time comes around.

-->--> This to me, seems like a credit trap.  I can clearly afford $1500 in credit according to my financial spreadsheet, but having to spread "good" payments amongst 3 cards with my pay period cycles makes managing their reported balances more difficult and in my opinion, does not represent my true credit worthiness.

-->--> Which is better for my credit rating: (3) cards reporting a 90% util, or (1) reporting 25%, (1) reporting 104% and (1) reporting 90%?

Macy's irked me by not covering a payment automatically when I had setup autodraft payments.  I got a 30 day late because of their flawed system and the CSRs refused to accept liability/blame for it.  I've learend a hard lesson on this one - don't trust automatic payments, ever.  Otherwise, I have a 99% on time record and will until this one drops off.

--> Macy's failed to notify me with a collections rep that I was in danger of getting a 30 day late.

--> Would it be worth it to try the "Goodwill Letter" with DSNB?  I have not seen any success stories (yet) with this company.  They seem to be very anti-consumer friendly with regards to waiving late fees or reversing credit bureau reporting.  The CRA's all saw it in the black and white scenario, "the payment was 30 days late, regardless of whose fault" so it met "FCRA standards"

--> this is my oldest account (2006) so I don't want to close it.  Having lost my wallet and having new CC #s issued to me ruined my "average age of credit".

USF FCU Auto Loan - 8.54%

--> I would like to start paying this down so I can refinance it to a lower payment, freeing up my liquidity to pay other items (like larger CC bills)

--> I'm concerned that I won't be able to refinance this vehicle because it is a 2006 and I'm just treading below water - a few weeks of heavy payments and I ought to be below $2k value by EOY.

--> If no considerable mechanic issues, should I trade it in and get a new(er) model, hopefully with better terms?

With all this considered, any helpful advice would be wonderful.

[Anonymous]

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@Anonymous wrote:

Good day myFico community!

I have been anonymously browsing the forums for a few weeks now to try to get ideas on how to increase my rating.  I have found a few short comings in my own credit profile that I am finding it very challenging in resolving - I could use some advice or "this is my story" discussions to help me decide how to tackle this beast. 

Currently, per Credit Karma, my TransUnion score is 528; I've found that my Experian is somewhere in the 570's recently when I was denied a request to consolidate my (3) cards into (1) card.

Revolving:

Chase Slate Visa - $500/limit - $495 balance - Reports to CBRU on 1st of each month - Given the 27% rate, won't reduce

CreditOne Visa - $500/limit - $545 balance - Reports to CBRU on 1st of each month - 21.99%

USF FCU Visa - $500 Limit - $100 balance - Reports to CBRU on 22nd of each month - 19.99%

Macys - $100 limit (oldest account) - $50 balance

Fixed Loans:

USF FCU Auto - $9,800 (orig. $13,200) - 8.54% (set to pay off

USF FCU Personal - $440 (orig. $1000) - 11.99% (paid off by Apr 2015)

Collections (all medical):

3 active, totalling $772

Verizon FIOS - $250

Verizon Wireless - $900 (stuck me with two cancellation charges and two months additonal service charges which I believe shouldn't be there.)

I think this is what would make my credit profile look better and raise my score significantly:

(1) $1,500 - $2,000 Visa/MC and getting rid of my Chase, CreditOne and USF FCU Visa's.

--> Goal would be to cover my basic living expenses (Utilities, Gas, Food, Entertainment) and make significant payments 2x a month to this card. Well, obviously one card is easier to manage than three. But they need to see you successfully managing three (or more) first.

--> trying to spreadout payments to three credit cards seems like a revolving door of bad decisions and in my opinion, because I am struggling to "report" low balances because of the time I pay them to the time they report, I've already paid bills, bought food, gas, etc. that bumps up those balances when reporting time comes around. It just takes lots of planning and tight budgeting. But it can be done. I would try to concentrate on using one card for expenses. Whichever one allows multiple online payments each month and posts the payments quickly. I'm assuming you are paid bi-weekly?

-->--> This to me, seems like a credit trap.  I can clearly afford $1500 in credit according to my financial spreadsheet, but having to spread "good" payments amongst 3 cards with my pay period cycles makes managing their reported balances more difficult and in my opinion, does not represent my true credit worthiness. The CC companies would appear to disagree - they WANT to see you successfully manage multiple smaller lines of credit *successfuly* before they will offer bigger lines.

-->--> Which is better for my credit rating: (3) cards reporting a 90% util, or (1) reporting 25%, (1) reporting 104% and (1) reporting 90%? Both of those scenarios are score killers. You need to get two cards reporting $0 and one reporting <10% of its limit.

Macy's irked me by not covering a payment automatically when I had setup autodraft payments.  I got a 30 day late because of their flawed system and the CSRs refused to accept liability/blame for it.  I've learend a hard lesson on this one - don't trust automatic payments, ever.  Otherwise, I have a 99% on time record and will until this one drops off. If you only have a single 30 day late, it will lose almost all of its impact after 24 months.

--> Macy's failed to notify me with a collections rep that I was in danger of getting a 30 day late. Yeah, no one really does that. They aren't concerned until AFTER you are late.

--> Would it be worth it to try the "Goodwill Letter" with DSNB?  I have not seen any success stories (yet) with this company.  They seem to be very anti-consumer friendly with regards to waiving late fees or reversing credit bureau reporting.  The CRA's all saw it in the black and white scenario, "the payment was 30 days late, regardless of whose fault" so it met "FCRA standards" GW is really the only option here.

--> this is my oldest account (2006) so I don't want to close it.  Having lost my wallet and having new CC #s issued to me ruined my "average age of credit". 1. The importance of AAoA is greatly exaggerated - its only 10% of the scoring model. 2. Closed accounts are NOT excluded from your AAoA as many seem to believe. 

USF FCU Auto Loan - 8.54%

--> I would like to start paying this down so I can refinance it to a lower payment, freeing up my liquidity to pay other items (like larger CC bills) You would be better off paying down the personal loan, and the two maxxed out cards first. Let this loan be your credit mix booster. You only need ONE installment loan at a time for best 'credit mix' portion of your score.

--> I'm concerned that I won't be able to refinance this vehicle because it is a 2006 and I'm just treading below water - a few weeks of heavy payments and I ought to be below $2k value by EOY. You're probably right - depending on the mileage, it may be impossible to refi. I would not pursue that.

--> If no considerable mechanic issues, should I trade it in and get a new(er) model, hopefully with better terms? No, you're certainly underwater on it. If its mechanically sound, keep driving it and making the regular payments. Trade it in once its paid off or very nearly paid off.

With all this considered, any helpful advice would be wonderful.

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[Anonymous]

Your advice has given me a lot to consider - thank you.  I like that you red-ink'd my comments - it helped ot put them in perspective.

Yes, paid bi-weekly.

I can see why tackling the CCs balance immediately after my personal loan would be a greater benefit to my overall score at a faster rate.  I didn't consider that before because I wanted to pay down the autoloan "for a chance to refi", thank you.  Despite the car being 2006, it holds its value very well; I'm at or slightly above water now.  It wouldn't be detrimental to my finances to keep its current payment rate either.  I think it will fall outside of the limits for age though, which is what I was a bit worried about...

I made a slight "oops" moment with the util %s -  Chase will typically report at or around 30% and USF also at or around 30%.  CreditOne takes the beating currently.  My last report was a tad high because of the Holidays.  Not an acceptable reason, but a common one.

[RobertEG]

You might take a moment to familiarize yourself with the basics of the Fair Credit Billing Act (FCBA).

It requries monthly billing of your CCs, which is their advisement of due dates and possible lates. 

Also, if you have an recurrence of billing relating issues, the FCBA has a powerful dispute process that includes discovery requirments not included in the after-the-fact FCRA dispute processes.  However, FCBA disputes have a timeliness requirment of no more than 90 days after becoming aware of a billing related issue.

[Anonymous]

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@Anonymous wrote:

Your advice has given me a lot to consider - thank you.  I like that you red-ink'd my comments - it helped ot put them in perspective.

Yes, paid bi-weekly. Same here. Yeah complicates things, but having another card that reports a week or so before or after your 'main card' can help even things out a bit. Just takes more planning. I'm on the Cap one website on an almost daily basis...

I can see why tackling the CCs balance immediately after my personal loan would be a greater benefit to my overall score at a faster rate.  I didn't consider that before because I wanted to pay down the autoloan "for a chance to refi", thank you.  Despite the car being 2006, it holds its value very well; I'm at or slightly above water now.  It wouldn't be detrimental to my finances to keep its current payment rate either.  I think it will fall outside of the limits for age though, which is what I was a bit worried about... Mileage is usually the big kicker. If its over 100K miles, the chance of it getting refi'ed  goes way down. Even though car last much, much longer than they used to a few decades ago, lenders are still terrified of that 'sixth' digit. They act like its a curse.

I made a slight "oops" moment with the util %s -  Chase will typically report at or around 30% and USF also at or around 30%.  CreditOne takes the beating currently.  My last report was a tad high because of the Holidays.  Not an acceptable reason, but a common one. eh, it happens. UTI is 'recovery friendly' in that FICO does not care what it *was*, only what it *is*.

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[Anonymous]

Nice -

Mileage is usually the big kicker. If its over 100K miles, the chance of it getting refi'ed goes way down. Even though car last much, much longer than they used to a few decades ago, lenders are still terrified of that 'sixth' digit. They act like its a curse.

I'll have to keep it on my radar; the car is well under mileage by 15,000.  USF FCU is pretty liberal in its lending and has been kind to me so far.  Once I pay off the signature loan and drop these CCs for 3 reporting periods I'll have to reach out to them to see if they would consider modifying my existing loan or refinancing my loan as well as up the CC limit.  I've been pretty lucky with them - banks, on the other hand, bah hum bug!  haha