Posts: 13,897
Registered: ‎04-15-2011
Re: Need help getting started

dggibbons21 wrote:

Hello everyone, after some bad life choices that I have finally recovered from I would like to begin repairing my credit before it destroys the rest of my life (I am 23).


Currently on my credit report I have a charged off citi bank credit card that has gone into collections as well as several medical bills in collections and what I believe is an out of state speeding ticket. I also have some student loans which are currently in a forbearance. Last I checked my score was a 570.

 I would check to see what the DOFD was of these debts you have in collection.  Plus how much are they?  Can you PFD them?  The speeding ticket I would probably go ahead and take care of, some of those don't really expire and could issue a warrant for that.  I'd really check into that one.

I was just approved for an unsecured capital one credit card with a low credit limit and high (24% or so) APR. I plan to use this to basically purchase a tank of gas or so per month and pay the balance in full to begin establishing a positive history with a creditor.

 Sounds like a great idea!

Im unsure as to where to begin or how to negotiate the pockmarks on my credit report. I am planning on returning to college so I am not  concerned about the student loans as they will be a non factor until I graduate. I am working with a limited income but have few expenses as I still live at home. Mainly my questions are as follows,


Do these collection accounts continue to lower my score the longer they are on my report?

Those collections hurt as long as they are on your CR. 

Do I attempt to negotiate with the initial creditor first or simply begin with the collection agency?

It depends, who is on your CR?  If it's the CA, will they accept a PFD?
What do I do about the charge off? I cannot afford to pay it off in one shot and it is a large balance (around 4000 $). The collection agency is offering to settle it for around 1500. Is it better to enter a long term arrangement and pay it in full or should I just settle it? Some people are also suggesting I wait until it falls off my report before pursuing it as doing anything now will cause the 7 year period before it is removed to begin all over again, I am very confused about all of this and am having trouble finding any concrete answers about what the best way to proceed is.

 If you pay/settle it, it's done.  There is no restart of the 7 year clock, it's done.  Now if you make payments, there is a chance on restarting the clock, it depends on your state's statutes on that one.

Im basically looking for a general plan of attack to begin fixing all these problems. I understand this will not be a quick process and am not looking for a quick fix. I didn't get into this trouble in a month and I don't expect to be clear of it for a long time.


Thanks everyone for your consideration and time.


Starting Score: 504
July 2013 score:
EQ FICO 819, TU08 778, EX "806 lender pull 07/26/2013
Goal Score: All Scores 760+, Newest goal 800+
Take the myFICO Fitness Challenge

Current scores after adding $81K in CLs and 2 new cars since July 2013
EQ:809 TU 777 EX 790 Now it's just garden time!