Rebuilding Your Credit

[kiasmith1974]

I am in the early stages of my rebuild after a horrible start which includes chargeoffs, late pays, a BK and a judgement.

The BK is 4 years old, the judgment is about 2 years old and I have 3 new cc accounts of which only one has been reporting for 6 months. (the other two are very new)

I have 4 more payments on my student loan repayment program before it will begin to report positively

My FICO has increased about 75 points with the new tl and a couple of disputes with the CRA's  and I am thinking about getting a secured loan from my credit union in the amount of $500 as this is the most I can spare at this time.

My utilization is always under 30% and I have no late pays on my new accounts. My AAoA is 6 years as I have one student loan completely paid off (with several 180 lates)

Taking into consideration that I only have 3 positive accounts, does this sound like a progressive idea?

Will this add to my score or bring it down or even matter at all??? Should i pay off quickly or slowly?

any help is appreciated.......my current FICO score is 600.

Thanks!

[madmann26]

What does your CR look like now?

[kiasmith1974]

1 BK discharged 8/2008, 2 separate unpaid student loans closed with 180 day lates, 1 judgment, 1 paid as agreed student loan with 180 day lates, and about 3 items in collection with one being reported by the OC and the CA on all 3 reports (sent DV letter to CA last week). I am currently in a repayment program for the 2 student loans, those should be reporting positively in about 4 months. I have 1 cap 1 card $300 limit reporting for 6 months no lates %20 uti. Just received a cap 1 cash rewards $500 limit this month and a $250 Fingerhut account this month. These are not reporting yet. EQ shows 12 inq with several dropping off in Jan 13 and TU shows 4 inq.

anything else i should add?

[jandj80]

Goodwill the student loan. They can be tough, but sometimes it works. I had better luck calling and talking to a manager. Since you are in repayment, see if you can negoitiate a pay on time for six months- delete the 180 days late type of deal. Keep the cards flawless and under 30%. A secured loan will help your mix, just make sure it does not report as secured! I would also see if you can dispute the judgment and if that doesn't work, ask for a goodwill. I also here in some states you can file to vacate it, but you will have to research that. 600 is pretty good really, I have about the same mix of baddies and 25 positive trades lines, AAoA 5+ years, and I have a much worse score. Sounds like you are doing things right!

[Shogun]

A revolving acct. would be better than an installment loan.  You should get a secured card.

[kiasmith1974]

Thank you for the advice! I will try the goodwill letters.

[kiasmith1974]

I've read that there should be a mix of installment and revolving, so your saying there is a greater benefit in having a secured cc than having cc's and a loan?

Thanks for the advice, its very helpful!

[Shogun]

Yes, installment loans actually don't factor in very much to your scores.  Your revolving accounts can account for as much as 35%.  I've seen people without any installment loans with scores in the 800s.

[kiasmith1974]

great! then thats what i'll do.....thanks again

does it matter which secured i get? are there some with better benefits than others?

[Shogun]

You should go post on the Credit Card boards.  They will give you all kinds of tips on that.  There are several.  Some like BOA can graduate to an unsecured card.  Also if you belong to a CU it is a good practice to get one with them and show active accounts with them.