Next Steps

[Anonymous]

Hi,

I'm working on rebuilding my credit. I started in October 2006 in the 500s and now my scores are TU: 700, EQ: 726, EX: 721. My goal is 750+ on all scores.

On TU, my biggest problem is a medical collection. The good news is it is old, so old in fact that it just dropped off of EX. If it drops off of EX and it is the same issue, should it not drop off of TU at/near the same time?

Beyond that, I have many late payments listed for one BOA account.

TU:
30 days late 2 times (Nov 2004, May 2004)
60 days late 1 time (Jun 2004)
90+ days late 1 time (Jul 2004)

EQ:
30 days late 7 times (Nov 2004)
60 days late 5 times
90+ days late 9 times (Jul 2004, Nov 2003)

EX:
30 days late 7 times
60 days late 5 times
90+ days late 3 times (Nov 2003)

I've sent a GW letter to BOA. I'm not too optimistic but I figured it couldn't hurt. I've been with them for almost 10 years and had perfect payment history since 11/2004.

The only other steps I've taken have been to reduce UTIL through CLI and opening one new card, a Chase United Mileage Plus Visa. I'm about to PIF my only open CC at the end of this month.

What are my next steps?

[RobertEG]

Creditwhiz, two comments........

Under the FCRA, the collection account cannot remain on your CR after 7 years from the date it was reported into collection, so it must be dropped after 7 years, as a matter of law.

As for a GWL to BOA, I tried that last year, and got a very terse letter from them saying that it is illegal,, in their opinion, to remove legit prior derogs  That is BS, but that is what you can expect from them.

I find it interesting, with all of those major derogs, that you are in the 700 FICO range, so there must be something really good in your current history that FICO really likes.  60 and 90+ lates are major FICO killers.  Interesting.

As for your recent opening of a new CC, while it may increase your total CL, you can also expect it to add a new inq, and also reduce your avg account age, so I see that as a rebuilding move, and not an action that will substantially improve your immediate FICO

Message Edited by RobertEG on 05-14-2008 09:49 PM

[Anonymous]

RobertEG,

Thanks for your input.

Regarding the 7 years for the CA to report, I'm aware of the rules. I note, however, that TU and EX had different "fall off dates". TU, which remains, says the item should be removed by 12/08 while EX said 07/08. I sent a dispute to TU saying the account was too old to be reported. We'll see what happens there.

As for the GW letter to BOA, thanks for relaying your experience. Again, we'll see.

The scores are pretty good, I'll admit, for someone with lates and a collection. I have only 5 or 6 CLs total. Two are student loans, paid on time every month. One is an open card with BOA with zero balance and the lates described above. The other is a BOA AMEX with 10k limit $2000 balance, which is about to get a $1500 payment tomorrow and PIF end of this month. I have one other CC which is a closed CAP1, they pissed me off so I closed without regard to the implications.

Finally, the UTIL setup was just a plan. I wanted to get another CL now and work on it over time. I have only 3 inq's total across all three CRAs.

Is there anything else I can do to bring up my scores?

Thanks.

-D

[RobertEG]

Although the FCRA prohibits the reporting of derogs after 7 years, other than bankrupticies (10 yrs) and unpaid tax liens (forever), it also provides for a 180 day window to cease reporting after those dates, so it may continue to report for up to 7 1/2 years, but after that, it is a clear violation of law to continue reporting. So dont hold them to a strict 7 years to the day!  Ease off....

As for other steps, yeah! I know it is hard to do, but you just gotta sit back and GET OLDER!  Age is the major healer!

As for closing of the Cap1, knowing them, I would suppose that it was a low CL card, so you probably lost little, especially if it had a yearly fee attached.

A major consideration in your FICO plan right now should be whether you need your FICO to apply for new credit in the near future, or whether you are rebuilding into the farther future.  Taking hard inqs now to set up a new account that, 5 years from now, will contribute to payment history and an aged account is a rebuilding strategy that is wise, since the inq will drop from scoring in a year, and the account history will grow over time.  But I would definately ease off of seeking new CCs as time goes by, for the effect on your avg age of accounts will suffer more.

So, as with all things in FICO, it all depends on your individual needs  You clearly understand the game.  Play it according to your plan and needs.

Message Edited by RobertEG on 05-14-2008 11:36 PM

Message Edited by RobertEG on 05-14-2008 11:43 PM

Message Edited by RobertEG on 05-14-2008 11:45 PM