Messed Credit Up, now what?

[Anonymous]

When I was younger I was never shown how to manage my finances as NO one in my family has good credit, money or financial habits. I carried this over into my adult life and became very embarrassed to ask for help. Luckily, my husband has such an amazing and understanding heart that he's dealt with me through taking care of my debt and showing me how to handle my finances. I also sought out financial counseling  from a CFA. I have made great strides over the past 2 years in progress. However, my credit is still damaged due to  all of the late payments I have in my history and credit inquiries from trying to get an auto loan and constantly getting denied or high interest rates. Anyways, I'm looking for guidance on how to bounce back. Please provide "legally" ok advice and successes. Im in the 600s now but across the board my scores range from mid 500s to mid 600s for all FICO scores. TIA

[Gramz]

I just want to say welcome to the forum.

The first thing to do is stop applying for loan, because you really do not need the inquiries on your credit.  I will try and write goodwill letters to each creditor explaing to them why you were late on the payment.  To be honest there is not quick or magic way to speed up the process it will take time and dedication.  Search this forum for goodwill letters and you will come accross a lot of success story and I am one of them. 

Good luck on your journey.

[Anonymous]

@ gramz you ain't kidding! 🤦 Been doing it for almost 2 months. It's exhausting LOL but I am so determined to repair my credit. My score has gone up 90 points so far since starting. Not stopping!

[RobertEG]

The highest-weighted scoring category is payment history, and that is usually the first place to begin in addressing rebuilding.

Can you list each of the derogs reported under your payment history (monthly delinquencies and any charge-offs reported by the creditor, or any collection reported by a debt collector), along with the age of the derog and the date of initial delinquency on the debt?

[DollyLama]

Welcome to the forums! 

Glad you have a supportive spouse and have sought some extra steps to improve your credit, and hopefully will gain some extra knowledge here that will optimize your score and education on maintaining good credit. 

First, you may have lates, but they do not stay on your reports forever! They will in time "age off" your bureau reports. It may take some years, and sounds like you have about 2 years? behind you already. Are the accounts that do have late payments reported still open or have creditors or yourself closed them? If closed, do they still have a balance or are they all paid in full, zero balance? Still having a balance on a closed account is counting in the overall utilization. 

Utilization is a big key. Keeping low utilization on revolving credit is where the score bumps play a big factor. Some are under the impression that as long as you make timely monthly payments, it does not matter what your balance is in respect to the credit line. It matters a HUGE deal. 

Aggregate Utilization weighs more than individual, but both are significant factors. You aim for no card to report 28.9% of it's total credit line, ie $289 (interest included) per $1000 line of credit. This is at statement cut, not due date. The statement cut is the balance that will be reported each and every month to the credit bureaus. 

The best and most scoring is from using your credit, can be small purchases of $10 but paying in full before the statement cuts, and letting a zero balance report. You are getting the credit length history and payment history. Except you let only ONE card report a balance, a low utilization as stated. Known on the boards here as AZEO= All Zero Except One. FICO does not like high utilization, nor creditors either, as creditor can close accounts or balance chase you till you are paid off. FICO does not like all zero balances on credit cards either, will drop your score significantly, hence leaving a low balance to report. There are thresholds to FICO scoring that sees score gains on utilization, <88.9% (extremely high), <68.9% (very high), <48.9% (getting there), <28.9< (good), and <8.9% (excellent), goes the same for aggregate and individual. It also matters how many revolvers are carrying a balance each month. 5 cc's and 5 balances not so good, 2 of 5, good, 1 of 5 the best. 

Besides the late payments reporting, do you have any other derogs, prev Bankruptcy reporting, any charge off or collections on your file?

Plenty of people on this forum are highly knowledgeable in directing you the best avenue to guide you. 

ETA: The poster above me is one of the extremely high knowledgeable ones.

[Anonymous]

I have alot of accounts that range from loans to CCs. I have 4EQ/3TU/1EX collections- paid/closed. Charged off 6EX/7TU/3EQ-paid/closed. All paid off except one account listed on TU, this was a voluntary repossession, listed as a charge off, from 2 years ago with a reflected balance of 5000, actual balance is less due to me making monthly payments but its not updated monthly to show payments have been made.  I have 5 CCs, never missed payments. 3 have balances at 20%, 40% and 60%, others have no balance.  My inquiries are extremely high due to my credit being ran last april by 2 dealerships, 30 iq!!!! 

[DollyLama]

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@Anonymouswrote:

I have alot of accounts that range from loans to CCs. I have 4EQ/3TU/1EX collections- paid/closed. Charged off 6EX/7TU/3EQ-paid/closed. All paid off except one account listed on TU, this was a voluntary repossession, listed as a charge off, from 2 years ago with a reflected balance of 5000, actual balance is less due to me making monthly payments but its not updated monthly to show payments have been made.  I have 5 CCs, never missed payments. 3 have balances at 20%, 40% and 60%, others have no balance.  My inquiries are extremely high due to my credit being ran last april by 2 dealerships, 30 iq!!!! 

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Well the good news, the dealership inquiries should not count as 30 seperate hard pull inquiries from a score perspective. Regardless from a FICO 8 score, after 1 year they are no longer scoreable. The only way they would show is it underwriting is required, a mortgage, auto. So roughly 2 months from now, poof gone from basic FICO 8 scores. 

The foreclosure you are paying on that is not updating, balance or payment history. Is it still showing with Original Creditor, ie Ford Motor Credit, XYZ Bank & Trust? Or are you paying another party that the OC has sold it to and  possibly has not even reported they have the account?

A little more information that Robert asked on the charge offs and collections, the age of the accounts, and date of first deliquency. Have you recently pulled your reports that show when they are due to age off? 

I don't not know your disposable income, nor need to, but if you can pay in full before statement date on 2 of the 3 that are open, and let only the one left report a balance, you will see a boost.  If not, at least try aiming for the largest utilization one to get below <48.9 percent of it's tradeline. Might need to chip away at it, as much as you can. 

[Anonymous]

So the major delinquencies first occurred in/around 2014/5. The I have 2 or 3 collections slated for fall off due to them being inaccurate. I’m pretty fortunate to have a decent amount of disposable income now with has afforded me to be able to get a lot paid off and I have not been incurring any additional debt since then. I have about 5000 in Debt on my cards that’s with since today, having only 2 cards with a balance. As far as the repo, it’s still with the same company. I plan on paying the full balance in about 3 weeks and then challenging the information due to the failure update and reflect payments or ask them to remove from my CR in exchange for the full payment.