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New Contributor
mizmagic
Posts: 64
Registered: ‎10-20-2012
0

Where do I go from here?

I would like to apply and be approved for a mortgage loan in a year or two. I have been rehabilitating my credit over this past year and have recently paid of all but one derogatory item on my credit report. This last one was just reported even though it is from 2008 ( I had forgotten about it until it recently posted to my report.) I am making payment arrangements on this debt as well as my student loans, which equal $25,000. My credit score is dismal (523) , but does not yet reflect the pay off I made this month for the negative items. I would like to know how my credit score might be affected once these actions post:

 

Pay down of negative balances from $4225 to $1225

 

On-time payment history of 9 months on my revolving debt (student loans) of $25,000

 

I have tried the score simulator, but it only allows me to simulate one action at a time. I need tohow my score will be affected based on what I have already done so that I can move forward.

 

Thanks in advance!


Starting Score: 523
Current Score: EQ 608 EXP 648 TU 565
Goal Score: 800


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New Contributor
mizmagic
Posts: 64
Registered: ‎10-20-2012
0

Re: Where do I go from here?

The new account that just appeared on my credit report is fron EOS/CCA.  I am really disappointed in myself for forgetting about this debt, but I wonder why, after I had paid everything else off, did this debt decide to rear its head?  My original balance was $850, but now I apparently owe $1225 on this debt because of the 8% interest charged on it. Just when I thought I was getting a handle on my debt...


Starting Score: 523
Current Score: EQ 608 EXP 648 TU 565
Goal Score: 800


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Valued Contributor
rckstrscott
Posts: 2,659
Registered: ‎04-25-2011
0

Re: Where do I go from here?


mizmagic wrote:

The new account that just appeared on my credit report is fron EOS/CCA.  I am really disappointed in myself for forgetting about this debt, but I wonder why, after I had paid everything else off, did this debt decide to rear its head?  My original balance was $850, but now I apparently owe $1225 on this debt because of the 8% interest charged on it. Just when I thought I was getting a handle on my debt...


Paying off negative informaiton does not really translate into score boosting.

 

FICO was designed to predict future defaults; paying on debt you should have paid anyway (aka bad debt) isn't a score mover.. you have to get negative information removed. -- the FICO point loss is the history of bad payments.

 

Paying down bad debt, collection accounts, liens, judgements will not cause your score to go up at all. There are certain elements that will (like if a charge off is showing a balance and THAT was factored into your util) but you need to focus on removing.

 

A lot of removing is paying though, so you are doing the right thing. When that debt is paid off you will want to send GW letters to try removal

 

EOS-CCA contacts were PMed to you, try to use those to negotiate a settlement or removal.

 

-scott

Starting FICO Score: 10/10: TU 498 | EQ: 502 Current FICO Score(lender pull): 05/12: TU: 722 | EQ: 712 | EX: 686
Collections Removed: Hunter Warfield, CBE Group, Merchants Credit Guide, EOS-CCA, Enhanced Recovery, Portfolio Recovery, UCB, American Collection Company, Medical Business Bureau, Jefferson Capital, Credit Portfolio Associates, FCO, LVNV, Convergent, Armor Systems
Other Negative Entries Removed:Plains Commerce CO, HSBC CO, 2008 Judgment Santander Reposession

Still Working On: Illinois Paid Tax Lien,
Positive Accounts:10/10: 0 | 07/12: 6 | Mortgage Closed 5/12, Macy's AMEX $3900, Citi/Home Depot $2000, Capital One Cash Rewards $1500, Capital One Secured $500, Credit One Bank $500. Total Utilization: 6%. AAoA: 1yr, 7mth. INQS: 8 TU, 8 EQ, 4 EX
Valued Contributor
rckstrscott
Posts: 2,659
Registered: ‎04-25-2011
0

Re: Where do I go from here?


mizmagic wrote:

I would like to apply and be approved for a mortgage loan in a year or two. I have been rehabilitating my credit over this past year and have recently paid of all but one derogatory item on my credit report. This last one was just reported even though it is from 2008 ( I had forgotten about it until it recently posted to my report.) I am making payment arrangements on this debt as well as my student loans, which equal $25,000. My credit score is dismal (523) , but does not yet reflect the pay off I made this month for the negative items. I would like to know how my credit score might be affected once these actions post:

 

Pay down of negative balances from $4225 to $1225

 

On-time payment history of 9 months on my revolving debt (student loans) of $25,000

 

I have tried the score simulator, but it only allows me to simulate one action at a time. I need tohow my score will be affected based on what I have already done so that I can move forward.

 

Thanks in advance!


Also, Student loans are not revolving debt.

 

But the 9 month ontime is a good start, keep that going.

 

Do you have ANY credit cards?

 

I was in a similar situation.. 31k in debt, no positive accounts and scores under 500... I was able to get to 700 and get a mortgage in 14 months..

 

-scott

Starting FICO Score: 10/10: TU 498 | EQ: 502 Current FICO Score(lender pull): 05/12: TU: 722 | EQ: 712 | EX: 686
Collections Removed: Hunter Warfield, CBE Group, Merchants Credit Guide, EOS-CCA, Enhanced Recovery, Portfolio Recovery, UCB, American Collection Company, Medical Business Bureau, Jefferson Capital, Credit Portfolio Associates, FCO, LVNV, Convergent, Armor Systems
Other Negative Entries Removed:Plains Commerce CO, HSBC CO, 2008 Judgment Santander Reposession

Still Working On: Illinois Paid Tax Lien,
Positive Accounts:10/10: 0 | 07/12: 6 | Mortgage Closed 5/12, Macy's AMEX $3900, Citi/Home Depot $2000, Capital One Cash Rewards $1500, Capital One Secured $500, Credit One Bank $500. Total Utilization: 6%. AAoA: 1yr, 7mth. INQS: 8 TU, 8 EQ, 4 EX
New Contributor
mizmagic
Posts: 64
Registered: ‎10-20-2012
0

Re: Where do I go from here?

I have no credit cards :-(

 

For whatever reason, according to the credit monitor on this site, my student loans are categorized as revolving debt (it should be installment debt, right?). Does these terms affect how the debt is viewed y creditors? 

 

I have sent off the GW letters you suggested and can only wait to see what happens after that. I am so anxious about this process, yet excited about the possibility of having credit that I can be proud of.


Starting Score: 523
Current Score: EQ 608 EXP 648 TU 565
Goal Score: 800


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New Contributor
mizmagic
Posts: 64
Registered: ‎10-20-2012
0

On the subject of credit, should I be trying to acquire s...

On the subject of credit, should I be trying to acquire some? Also, should I wait until the changes post to my credit report or should I apply now?


Starting Score: 523
Current Score: EQ 608 EXP 648 TU 565
Goal Score: 800


Take the FICO Fitness Challenge

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