02-11-2010 12:24 PM
02-11-2010 02:20 PM
To add, paying a CA (collection agency) or a judgment will never improve your FICO score. It doesn't matter if you owe $0 or $10,000, the damage is equal. FICO and lenders are focused on whether or not it is reporting, vs. the balance.
Congrats on paying off the debt. What you should have done, as the prev. poster hinted, you should have sent PFD letters to the CAs. You can't now since the debt is paid, but you can send GW (goodwill) letters to those CAs and ask them to delete themselves. For the judgments, you'd have to contact plaintiff's attorneys and ask them to file a motion with the court to have the judgment removed.
I'd suggest reading the following:
Credit Scoring 101 - great for knowing what is in your credit score and to see how your score is impacted.
and What Steps Do I Take - great for learning the repair process.
02-11-2010 02:55 PM
02-11-2010 03:06 PM
First of congrats on paying off old debts. Your LO should have told you NOT to do this, if he/she was aware. We experienced the same thing, and was advised WRONGLY, but we got a new LO and I got 2 secured credit cards since I had NO revolving debt and this increased my score tremendously. One more thing, they may have re-aged your account to look new, which may cause a problem. If not already, uou will need to prepare a letter of explanation. So again, get a credit card if you do not have one, pay it off prior to statement date, keep balance at lease 1-9%. You will be OK. We lost what we thought was our dream home, but it came on the market 3x's, but we end up finding another DREAM home.
myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.>> About myFICO