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Hey there- so glad to find a resource like this. I'm trying to work my way out of a bottomless pit and my head is spinning.
A little backround if you think it's relevant - I'm 32 and married and my husband and I are clueless about money. We come from families that are clueless about money. We were hit extremely hard in the recession and are still reeling from it. Mostly everything negative that happened happened back then but we do have a few degragatory things on our reports as recently as 2013 -such as a repossession charge off, and a couple of deliquent bills. 2 or 3 medicals for around $100 each and a bank charge off for $900. We finally have decent paying stable jobs and want to get a handle on things because we are desperate to buy a house. I don't know my actual credit scores. I estimate it to be 590-620. Credit Karma says 611 for transunion 605 for equifax. I don't want to pay for scores. If there's free way to see the actual ones, please let me know!
As I said I'm very overwhelmed. There's so much information. What I would really love is to sit down with someone face to face and go through my credit reports and figure out what and how to attack it to get my score up. But I have no idea where I would go for that resource. Debt and credit counselor? I can't seem to find anything like that in my area. And I'm worried that I'll end up somewhere shady and get bad information. Does anyone have ideas of what to look for when I'm searching for resources in my area? Or even like a beginner's guide to increasing your credit score type book?
Here are a few other questions that perplex me:
-Why do Credit Karma and Capital One get different numbers for the same bureau's score? Which is more accurate?
-Should I make frequent purchases on my credit card and then immediately transfer funds to pay off the purchases (while still carrying a balance) even if it takes me near my credit limit (which is only $300)? I hope that makes sense.... I'm wondering if using my credit card like my bank card, as in going grocery shopping, using CC then immidiately making a payment to the CC would help increase my score because I'm using the card frequently or no because that grocery trip might be $200 which is too close to my $300 limit.
- I understand about having 3 different cards but why do I see people recommend 2 different Capital One cards? Wouldn't it be better to have more variety? So would the proper way to use these cards be that one carries a balance and the other two get paid down to 0 after you use them and you rotate which one carries the balance?
At this point I only have one credit card, a car loan and my student loans which are deferred for another year. My total debt is like $65,000 which feels like it might as well be $65 million. I'm not sure if we should be putting our energy into paying down our auto loan - because it's high interest and high payment, paying on the baddies or saving up a down payment.
I know the advice is to get two more credit cards but I'm scared of my score getting any lower. Any advice?
Thanks so much for any insight you might be able to give me.
@Anonymous wrote:Hey there- so glad to find a resource like this. I'm trying to work my way out of a bottomless pit and my head is spinning.
A little backround if you think it's relevant - I'm 32 and married and my husband and I are clueless about money. We come from families that are clueless about money. We were hit extremely hard in the recession and are still reeling from it. Mostly everything negative that happened happened back then but we do have a few degragatory things on our reports as recently as 2013 -such as a repossession charge off, and a couple of deliquent bills. 2 or 3 medicals for around $100 each and a bank charge off for $900. We finally have decent paying stable jobs and want to get a handle on things because we are desperate to buy a house. I don't know my actual credit scores. I estimate it to be 590-620. Credit Karma says 611 for transunion 605 for equifax. I don't want to pay for scores. If there's free way to see the actual ones, please let me know! Go to the Credit Check Total website - they have a 7 day trial offer for $1. You can get all three FICO scores plus all three reports. Just make sure you call and cancel BEFORE the 7th day, or you will be charged $29.95. If you tell them you're cancelling because its too expensive they will usually offer you a discount to $14.95 per month for one year, which is a really good deal. If you're not ready for that yet, just go ahead and cancel it.
As I said I'm very overwhelmed. There's so much information. What I would really love is to sit down with someone face to face and go through my credit reports and figure out what and how to attack it to get my score up. But I have no idea where I would go for that resource. Debt and credit counselor? I can't seem to find anything like that in my area. And I'm worried that I'll end up somewhere shady and get bad information. Does anyone have ideas of what to look for when I'm searching for resources in my area? Or even like a beginner's guide to increasing your credit score type book? Just sitting down and reading this forum for a few hours each day for the next two to four weeks. If you're still not feeling like you're "getting it", just let us know what questions you have.
Here are a few other questions that perplex me:
-Why do Credit Karma and Capital One get different numbers for the same bureau's score? Which is more accurate? These are known as "FAKO's". They are other scores that try to emulate the FICO scores. Sometimes they come close other times...not so much.
-Should I make frequent purchases on my credit card and then immediately transfer funds to pay off the purchases (while still carrying a balance) even if it takes me near my credit limit (which is only $300)? I hope that makes sense.... I'm wondering if using my credit card like my bank card, as in going grocery shopping, using CC then immidiately making a payment to the CC would help increase my score because I'm using the card frequently or no because that grocery trip might be $200 which is too close to my $300 limit. Yes, that is exactly how you should use your card. Run it up, then pay it right back down immediately. On the statement date you just want it to have a small banlance of$10-$20 or so. After 2-3 months of heavy usage like this, go online and request a credit limit increase. If you have already been doing that for a few months then request an increase now.
- I understand about having 3 different cards but why do I see people recommend 2 different Capital One cards? Convenience. Its nice to have multiple cards with only one payment interface to deal with. Wouldn't it be better to have more variety? So would the proper way to use these cards be that one carries a balance and the other two get paid down to 0 after you use them and you rotate which one carries the balance? Yes, but no need to rotate. Just pick one card and let it carry the small balance.
At this point I only have one credit card, a car loan and my student loans which are deferred for another year. My total debt is like $65,000 which feels like it might as well be $65 million. I'm not sure if we should be putting our energy into paying down our auto loan - because it's high interest and high payment, paying on the baddies or saving up a down payment. Impossible to say at this point, without seeing your full picture.
I know the advice is to get two more credit cards but I'm scared of my score getting any lower. Any advice? Go ahead and get one more ASAP, you should get a small score boost from a second card, and after a copule of reporting cycles, go ahead and get the third one. Any minor score ding from the third one will be balnaced out by score growth over the next few months.
Thanks so much for any insight you might be able to give me.
The most critical thing do by far, to rebuild your credit, is to absolutely maintain PERFECT PAYMENT history going forward. If you can maintain a perfect payment history, while addressing the worst items in your reports (which are unpaid credit card charge offs, and collections that update every month) then you can build a 700 score in 24 months.
Thanks for the reply. That's really helpful!
Yes! Emphasis on perfect!
In my wallet: Venture 15k; Barclay Ring Platinum MC 12.5k; Discover 10k; CareCredit 7.7k; Amazon Store Card 5k. QS 5k; BofA Travel Rewards 3.5k; BofA Travel Rewards 3.5k; BofA Platinum Visa 2k; Barclay Apple Rewards 2k. Total Credit: 66,200. 7/1-FICO: EQ - 789; TU - 781; EX - 690; GOAL: 780 across the board then 800 across the board. Inquiries: EQ: 4; TU: 7; EX 7; Chapter 13 seven years May, 2015. Reset my garden date to 6/27. Gardening until further notice.
This forum has all the information you need to get perfect credit and a house. Just read. Start in the rebuiding section. Search your questions, they have def been asked before as most of us have gone through the exact same thing you are. Don't lose hope, you have found the right resource to resolve your credit troubles. Good luck.
Ditto what Norman says. I started following his advice and others here on MYFico about 9 months ago and it really helped me. Utilization is absolutely critical for those of us rebuilding. I now have two scores in mid/low 700s now and lots of great new CCs with good SLs. Good luck -- if I can do it, you can too!!
Thanks guys
@Anonymous wrote:Thanks guys
Welcome you have great support here
You will be amazed at the kindess and expertise of members of the forum. Good luck in your journey as you reach your goals.
In my wallet: Venture 15k; Barclay Ring Platinum MC 12.5k; Discover 10k; CareCredit 7.7k; Amazon Store Card 5k. QS 5k; BofA Travel Rewards 3.5k; BofA Travel Rewards 3.5k; BofA Platinum Visa 2k; Barclay Apple Rewards 2k. Total Credit: 66,200. 7/1-FICO: EQ - 789; TU - 781; EX - 690; GOAL: 780 across the board then 800 across the board. Inquiries: EQ: 4; TU: 7; EX 7; Chapter 13 seven years May, 2015. Reset my garden date to 6/27. Gardening until further notice.