Probably The Worst Situation Possible

[Anonymous]

Hi LanaiaLei and welcome to the forums. I took the liberty of reformatting your post to make it easier to read. I'm also going to move it to the Rebuilding Your Credit board. I think you'll get more responses there - MarineVietVet, myFICO moderator

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Hi everyone! First off I've been a longtime lurker and I've enjoyed many of the responses and guidance provided on this forum. It's so great to see many of you rise up financially and prove that there is life after BK. For me though, I feel that will never be possible. I was discharged from ch7 in Feb 2010 and did somewhat okay in my beginning efforts of rebuilding. I was able to obtain the following cards:

BBRZMC -$300 limit

Household Visa- $300 limit

Credit One Bank- $300 limit (recently closed)

Alliant CU Visa- $500 limit

Kay's/Jareds- $500 limit

Capital One Visa -$750 limit

Apple CU Secured Visa- $750 limit

Fingerhut-$950 limit

Capital One Rewards- $1250 limit

CFNA Firestone-$1600 limit

Honda Financial Auto Loan- 2011 Honda Odyssey (joint with DH) Honda Financial Auto Loan-

2012 Honda Accord (joint with DH) Santander Auto Loan-

2008 Nissan Sentra (for 18 year old soon who's working and starting college in 2months)

The biggest problem I have are my student loans that are appox $105k total tha have numerous 30,60,90,120 lates reporting. The first group of lates started after the BK when they started re-reporting and I wasn't aware. The 2nd time was last year when I was dealing with a mother who was near death and everything just overwhelmed me and I honestly didn't have the mental/emotional bandwidth to deal with them.

Am I just doomed forever to have a 450 credit score. I've heard that you're basically SOL is you have anything report late after a BK. DH and I are really hoping to use his VA loan and buy a home in 2 years. BtW....DH did not file BK. We weren't married then. I filed BK due to a bad mortgage loan, poor education on my part when I had my home built. Thanks in advance for any advice!

[Anonymous]

Keep stong and work your credit up... Stay within only around 10% credit used on all the cards and just keep on paying them off.  This will show that you are responsible with whatever you have right now and slowly it will build credit.  Also try to increase the credit limit on some of those cards around $1000 or more since anything less than $1000 does make your score a little lower.  My friend also went BR about 2 years ago and is in the 620 in all three CB as of this month.

[RobertEG]

I would suggest also posting in the Student Loans portion of the forum.

That area is inhabited by those having experience dealing with your issues.   It looks as if GW requests would be the best approach.

[laz98]

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@RobertEG wrote:

I would suggest also posting in the Student Loans portion of the forum.

That area is inhabited by those having experience dealing with your issues.   It looks as if GW requests would be the best approach.

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Definitely agree.

[-Cain-]

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@Anonymous wrote:

Keep stong and work your credit up... Stay within only around 10% credit used on all the cards and just keep on paying them off.  This will show that you are responsible with whatever you have right now and slowly it will build credit.  Also try to increase the credit limit on some of those cards around $1000 or more since anything less than $1000 does make your score a little lower.  My friend also went BR about 2 years ago and is in the 620 in all three CB as of this month.

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How? Do you mean in regards to utilization percentage?

[Anonymous]

Have you tried consolidating all of your school loans?  That will give you a fresh start , and hopefully a better percentage rate.   You might try sending good will letters to the loan holders they can be flexible with deletions.  Did you get a diploma with all those student loans?  The reason im asking is that depending on the field you are in,  the loans can be forgiven after so many on time payments,  librarians, nursing, teaching, etc etc.  There are programs out there to help you get things under control you just have to find them.  Utilization is important of course,  but remember not to cancel the cards when you get them paid off. 

[jeffg330]

I'm no expert but am wondering if it's really neccesary to carry a small balance on ALL the cards you have. Make sure if it's not best to keep some active with a zero balance and keep some with just below 10%
Best of luck, I'm sure in two years you'll be looking at a much higher score

[rckstrscott]

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@jeffg330 wrote:
I'm no expert but am wondering if it's really neccesary to carry a small balance on ALL the cards you have. Make sure if it's not best to keep some active with a zero balance and keep some with just below 10%
Best of luck, I'm sure in two years you'll be looking at a much higher score

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MY best approach has been 0 on all cards, and 300 dollars on my $3900 dollar card (so whats that, around 9%)

That gives my overall util at 5%, and gives me my best FICO -- I played around a LOT with these numbers.

As with anything, YMMV.

-scott

[jeffg330]

Being that the OP has stated a two year goal, she has plenty of time to experiment and see the difference in carrying different balances on the multiple cards. Score watch will be most helpful keeping track of that over the months. Find out what mixture of balances (my understanding is 9% optimal) VS Zero's suit you best and roll with it. Two years ought to be [plenty of time to acheive a healthy enough score.

You havent failed until you stop trying

[urbex]

Re: paying interest on balances just to show use - it's my understanding, at least with my Cap1 card, that they report balances to the CRAs the day after the due date.  I get notified of the balance due a couple weeks before the due date, and pay it immediately upon receipt of the notification, then charge something like a pizza to the card the day that the payment is actually due, which is what gets reported to the CRA.  

So, say I have a $200 balance on the card.  For easy numbers, say I get notified on June 15, with the payment due on July 1st.  I've already paid on June 15, so I have a zero balance on the due date.  I charge $10 on the card July 1st, which gets reported to the CRA on July 2nd.  

In this way, I'm showing the utilization, but I never pay a single cent in interest.  That said, it does take a bit more effort on my part, which some people may not be able to keep up with.  If you're one of the people that see this and think "Good Lord..anal much?" , you can take the approach of just paying the balance down to $5-$10 each month, and letting that roll over.  Yes, you'll pay interest on it, but $10 at a 20%APR is only about $0.10/month, or a bit more than $1/year.  

For me, as someone who have previously let my credit get WAY out of control, and dealing with the extra hassle of my method now is well worth the warm fuzzy feelings I get every month by paying it off in full, and seeing the $0 balance