@johnnyscience wrote:I have 2 different student loans that total around 5k between the two.
They have both been on unemployment deferrment for a couple of years now with some late payments inbetween because of missing the re-deferrment window.
If I take them out of deferrment & start making normal, monthly payments on time, will it start rebuilding my credit & increase my score?
Thanks.
SLs are installment loans and ILs normally do not have that big of an impact on FICO, but in this case you have late payments, the best thing to do with these TLs is start writing GW letters to get those lates forgiven. I would not take it out of deferrment just because you want to raise your score. I would concentrate on your revolving credit cards this is the area that will give you the biggest score gains. utilization of CCs is 30% of your FICO, the other biggie is payment history at 35%. Instalment loans typically have an impact in the type of credit category (10% of score) and the payment history categories. Good luck in your journey 
@johnnyscience wrote:ok, good advice thanks.
Actually the 2 current loans do not have any lates. The one with Sallie Mae had a 35 day late and I owed them $180 in payments & late fees because I guess it got out of deferrment a little earlier than I thought.
But I called today & they said they don't send in lates until they hit 90 days and that they won't send in the 35 day late. They also suggested that if I do a voluntary forebarance that it would reset my payment clock for payments and erase the 35 day late and reschedule my payments to restart freshly in July, starting with paying off the $27 late fee.
I did this & got everything squared away for payments to start in July but plan on making the $51 payment tomorrow anyways to clear up the late fee & start attacking the principal. I will also make an additional/extra payment in June before my forebearance runs out just to keep on a good payment schedule for myself.
So even though student loans are installment loans and don't affect the score as much as a CC, once I get both out of deferrment & start making regular payments, it will help & increase my score though right? If they do it will be only a few points as I have already stated they dont have a big effect on FICO unless you default on one. I have had 2 personal installment loans, when I paid off the first I lost approx 10 points because I did not have any open installment loans, when I got my second installment loan my score went up approx 7 points but I dont get further increases in score every month as the install loan ages, in the grand scheme of FICO they really dont matter much. Here is another quirk I have noticed on installment loans: In the comments section on what factors are affecting my score(s) is this, the reported balance is too high in relation to initial balance (or something like it) so I am losing a few points for this, I get this all the way down till the balance hits 0 then I get "You dont have any recent installment loan experience", LOL talk about "double speak"......
I also don't have any other credit cards other than a $250 First Premier Credit card that they just recently transfered an old charged off account balance to to help me get a new/fresh start.
I will look into another credit card or two to help increase the score on top of starting the student loans and the FFC credit card. But I don't know that I will get approved for any based on my scores & the few collections that I have on my credit. (Including a repo for 8k but I'm not even considering touching that until everything else is cleaned up and hopefully by then it just falls off)
Grab 2 secured cards, you need 3 bankcards minimum to really maximize your FICOs. Look into SDFCUs secured card, info I have gleaned is its a SP to join the CU then if you have the funds for the secured card in your savings account already is another SP to open it. This card will not graduate to an unsecured but it will eventually help you getting unsecured CC from the CU and other creditors. The second secured I would get for graduation to unsecured, BoA has one but you can only get it by offer, you can also check with local CUs, Cap-1 has secured CC but it never fully graduates to unsecured, they do give occasional CLIs without having to add more funds.
@johnnyscience wrote:Ok, is this the State Department Federal Credit Union Secured card you are referring to:
https://www.sdfcu.org/emv-prepaid-card
If so I will look into applying for that one right away, any suggestions on how much to open it with? Yes, the amount is up to you personally I didnt do less than 500 when I needed a secured card, its really how much you can afford to tie up in the CL.
I will also look into BoA for their secured to Graduate card program.
Capital 1 is the company I have 2 outstanding Charge offs with, one for $1450 & one for $500. The one for $1450 has become a judegement. I plan to pay off both of these cards & see what I can negotiate with Cap 1, but this won't be for a couple months while I attack the smaller debt/collections on my account first as well as establish these Secured credit cards.
Since Cap 1 is out of the picture for now I will keep my fingers crossed in hopes that BoA will allow me to get one of the Secure/Graduate cards.
Also what does SP mean? Soft Pull (inquiry)