Mountain climb...

[Anonymous]

Hi guys!!

This is my first time on the forum, althiough I've viewed in it random searches from time to time over the years. I am currently trying to rebuild my credit from a recent repossesion that was the result of a seasonal job turned bad after college. I was working at a powersports dealership that low and behold...only made money during the summer. Fall season came around and I was faced with some tough choices...choosing between rent and my car payment. What I should have done was called my bank and let them know my situation, but I was so determined to turn my bad luck at the dealership around I lost sight of the bigger pictuire....then POOF...no car. They literally took the car from me on a random Tuesday then, then I found myself in a credit hole for 7 years...

Fast forward 8 months now and I have a job overseas. I make pretty good money so I am currently paying off all of my debts. They wrote of the difference in value for the car after they sold it at auction, so I'm not sure if I can pay that off or not. Or if I even should. All I have left is $192 debt from a few years ago where my then-fiance put a hole in a wall of an apartment during a fight that we both refused to pay for (I know, apartment was in my name so I should have just paid it) and for some time to pass so that my past accounts that I've paid off can start to leave my credit report and I can get a much needed boost.

My credit score is a 514. Where do I go from here?

Thanks a million guys!!!

[medicgrrl]

When a debt is written off, that's only an internal accounting measure. You still owe the amount and they can still sue and obtain a judgement.

If you have the funds available, I would look into obtaining some secured cards in order to begin re-establishing credit. The problem you may run into is that you're overseas. Do you have a US address?

[Anonymous]

You say your credit score is 514 -- where did you get that number from?  It isn't clear.

First of all, credit repair is a 4 part process and you need to handle all 4 parts at the same time:

1. Clear up negatives -- this can happen in many ways.  Proper disputes, goodwill letters, PFDs, etc.
2. Add new credit -- generally speaking, the most popular methods here are the Capital One secured card and the Discover IT secured card.  Both of these are from prime banks, no annual fees, and they help rebuild credit.  If you have no active loans (student, auto, home) you may want to do the Alliant SSL since it's practically free and reports a good loan for up to 5 years.  Highly recommended.
3. Learn to save -- now is the time to put money away in your emergency fund and never touch it unless it's actually an emergency.
4. Build a budget -- just because you are making good money doesn't mean you have more money to play with.  A budget includes emergency savings, retirement funding, paying down delinquent debt and judgments, rent/utilities, food, and finally luxury spending if you have any money left.  If you have delinquent debt, you shouldn't have any luxury spending (not even Netflix) until you're clear of old debts!

Good luck -- it's a process, but in 2 years, you may find yourself in the mid 600s or even higher.

[Anonymous]

First and foremost guys thanks for the replys. Every little bit of support goes a long way.

I got my score from Experian. I should invest in myFICO score here pretty soon, but I'm trying to clear up some other useless expenses that I have (i.e. gym memberships in the states, rental insurance, etc) before I press forward with that step. I do realize how important this is and I'm going to make it a priority.

I do not have a state side address, and as of right now I have no access to mail. However I do go on vacation in 2 weeks (going home to see my mother and grandmother for the 1st time in over a year) so I look forward to ironing out that issue while I'm there.

Once I start getting everything ironed out, I am most definitely going the secured credit card route. I think one of my issues with my credit is that I've never actually had a credit card, since we never learned about them in school and my folks always pushed us away from them. 

As far as goodwill letters go, I'm thinking this is the best route to take as far as getting my car issue ironed out. I'm hoping and praying that if I pay the difference off in full, that the bank will agree to take the repo off of my credit...if thats at all possible (fingers crossed).