topic Re: Im so new to improving credit - please help in Understanding FICO® Scoring

Im so new to improving credit - please help

Tryinghardtoimprove — Mon, 08 Jun 2020 15:45:39 GMT

Hi. I've been working on improving my credit. I obtained a new Nov 7/19 that pays better and has allowed me to pay some things down.

My credit utilization never goes above 7%.

Credit:

Discover It 1500 limit 49 balance

Milestone 300 limit 10 balance

Fingerhut 1100 limit 0 balance

Credit builder loan through Credit Union 800 for 6 months. Made one payment so far. 600 balance

Car payment - recently paid off one car and traded it in on a new on . Have made 3 payments on the new car so far.

Student loans 110,000 all paid time not late in the last 24 months. On covid forbearance but still making payments to reduce balance.

All my payments are on time except one 30 days delinquent in April 2020. I traded the car in the day before the state shut down due to coronavirus. My purchase and trade deal sat in a desk and they failed to pay my old car loan off and I was reported. I disputed it but the car company wont take it off. The new car dealer did pay my first payment but my score took a 36 point hit.

My scores are

Discover 590 - due to update on the 11th. They sent my 200 security deposit back and increase limit to 1500 in May 2020 after 1 year.

Fico 8 Trans Union Discover It 590

Fico 8 Experian Fingerhut 605

CapitalOne Creditwise 585

TransUnion 9, my Credit union was 572 went down to 541 not sure why. Every other score went up but they only update every 3 months. I think because the new auto loan.

My bankruptcy is 5 years old

I need to know if I should pay for rent reporters to boost my Fico 9? My rent has never been late in the last 5 years

Should I pay collections for Credit One and Capital One, Khols and boscovs, even though they wont provide me with a letter saying they will delete the negative reporting? The balances for these are very low and only Credit One shows up on my credit reports.

I am financially in a position to pay old collections and to pay for secure or unsecure credit cards

Should a try to open at least one more credit card and if so with my low scores who should I go through? I already had capital one, credit one within the last 5 years. I had premier about 8 years ago.

I hope this is enough info. My score increase from a 514 in Dec 2019 so its better but I believe ther could be alot more I could be doing.

I would like to purchase a home on some acres in a year.

Thank you all in advance for your wisdom

Re: Im so new to improving credit - please help

Girlzilla88 — Mon, 08 Jun 2020 16:14:17 GMT

So yes even if they won't remove the collection a Paid collection is better reporting than unpaid think of it like if you were a Credit Company and two people came to you wanting credit from you one had 4 collections that were all unpaid and the other had 9 but paid them all you would be more willing to go with the 9 even if it is a higher number because they still paid towards their debts than the one with less that the people never saw anything back out of. That's just the way I like to look at it. But maybe after you paid it as well a bit down the line you can see about getting it removed at that point, OR doing an early removal when it's closer to the fall off time after paid. Getting those off will help your score for sure I would wait on opening new ones for now until you get it a bit up and up and have your card that is the 'newest' at least 1 year before applying I'm not sure how old your newest is but just food for thought. You could also see if the Rent Boost helps but I have no experience with that or knowledge of it so there's that but it sounds like it could if you have never been late for 5 years help give a boost

Re: Im so new to improving credit - please help

Girlzilla88 — Mon, 08 Jun 2020 16:15:29 GMT

It also shows that you know you have them and are willing to correct it (shows growth on your end) Another side note lol

Re: Im so new to improving credit - please help

Girlzilla88 — Mon, 08 Jun 2020 16:17:28 GMT

You could also see how old those are too if they are old enough that they will fall off on their own soon (within the year or next year) I would let them be where they are because if you did pay for them that does have the potential to restart the clock another food for thought lol

Re: Im so new to improving credit - please help

FireMedic1 — Mon, 08 Jun 2020 16:28:29 GMT

@Tryinghardtoimprove wrote:
Hi. I've been working on improving my credit. I obtained a new Nov 7/19 that pays better and has allowed me to pay some things down.
My credit utilization never goes above 7%.

Credit:
Discover It 1500 limit 49 balance
Milestone 300 limit 10 balance
Fingerhut 1100 limit 0 balance
Credit builder loan through Credit Union 800 for 6 months. Made one payment so far. 600 balance

Car payment - recently paid off one car and traded it in on a new on . Have made 3 payments on the new car so far. You only need 1 installment loan open. Since yhou got the car. You can payoff the CU loan. That will lower your loan util %.

Student loans 110,000 all paid time not late in the last 24 months. On covid forbearance but still making payments to reduce balance.

All my payments are on time except one 30 days delinquent in April 2020. I traded the car in the day before the state shut down due to coronavirus. My purchase and trade deal sat in a desk and they failed to pay my old car loan off and I was reported. I disputed it but the car company wont take it off. The new car dealer did pay my first payment but my score took a 36 point hit. Since they wouldnt fix it. You can file a complaint with the CFPB and upload supporting documentation to get that late removed.

My scores are

Discover 590 - due to update on the 11th. They sent my 200 security deposit back and increase limit to 1500 in May 2020 after 1 year. Congrats!

Fico 8 Trans Union Discover It 590
Fico 8 Experian Fingerhut 605
CapitalOne Creditwise 585
TransUnion 9, my Credit union was 572 went down to 541 not sure why. Every other score went up but they only update every 3 months. I think because the new auto loan. Possibly. But CU's mostly have their own internal scores.

My bankruptcy is 5 years old As a fellow BK'er. Theres no point gain as aBK ages unfortunately.

I need to know if I should pay for rent reporters to boost my Fico 9? My rent has never been late in the last 5 years With all the data breaches. Ity wont help much nor do you want to give a CRA your banking personal info.

Should I pay collections for Credit One and Capital One, Khols and boscovs, even though they wont provide me with a letter saying they will delete the negative reporting? The balances for these are very low and only Credit One shows up on my credit reports. Anything thats paid will always better paid then owed. CO is known to delete CO's with a solid GW letter.

I am financially in a position to pay old collections and to pay for secure or unsecure credit cards

Should a try to open at least one more credit card and if so with my low scores who should I go through? I already had capital one, credit one within the last 5 years. I had premier about 8 years ago. Fix whats broken first. Then you wont have to go down the vulture highway. Let time heal. You have enough to build on for now. Let the wounds heal.

I hope this is enough info. My score increase from a 514 in Dec 2019 so its better but I believe ther could be alot more I could be doing.

I would like to purchase a home on some acres in a year.

Thank you all in advance for your wisdom

There ya go. It doesnt happen overnight but in time the good will outweigh the bad. Just need patience. Getting more credit is never a good way to improve things. More hit for new credit knock scores down. Let them go up. Then in time better credit products will be more obtainable. Good Luck!

Re: Im so new to improving credit - please help

Tryinghardtoimprove — Mon, 08 Jun 2020 16:32:09 GMT

Thank you for all the advice. Both my milestone and discover it are 14 months old. I really want a non secured through my credit union and they require a 640 transunion 9 so I will definitely wait to apply for new credit. I will also check the date on the collections and pay all that are not due to fall off soon. They are 3 years and younger so I dont think they are due to fall off yet.

One more question. Where do you get your scores from? I want to ensure Im working with the most accurate scores.

Thank you so much.

Re: Im so new to improving credit - please help

Tryinghardtoimprove — Mon, 08 Jun 2020 17:24:51 GMT

Thank you

Re: Im so new to improving credit - please help

Trudy — Mon, 08 Jun 2020 21:51:24 GMT

Calling @AllZero you seem to know all the cheapest ways to obtain FICO scores

Re: Im so new to improving credit - please help

AllZero — Mon, 08 Jun 2020 22:05:18 GMT

@Trudy wrote:
Calling @AllZero you seem to know all the cheapest ways to obtain FICO scores

Your wish is my command. 😃

$1 you can obtain your 3 bureau FICO 8 scores and reports at Experian or CreditCheckTotal (part of Experian). Cancel in 7 day or less to avoid the re-occurring monthly charge. Wash, Rinse, and Repeat as needed.

AnnualCreditReport. Free weekly 3 bureau online reports through April 2021.

Free credit reports (disregard the VantageScore 3.0 score) at:
Credit Karma for weekly TU and EQ reports.
WalletHub for daily TU report.

Re: Im so new to improving credit - please help

Tryinghardtoimprove — Mon, 08 Jun 2020 22:31:04 GMT

Thank you all

Re: Im so new to improving credit - please help

Tryinghardtoimprove — Mon, 08 Jun 2020 22:31:31 GMT

This is great info. Thank you all

Re: Im so new to improving credit - please help

Anonymous — Tue, 16 Jun 2020 05:15:46 GMT

The bankruptcy is keeping you in a dirty scorecard, so actually there is no new account penalty for getting new cards. All it costs you is the inquiry and the effect to average ages.

With that said, as @Anonymous said, having more than one loan is redundant. That actually hurt you by lowering your average ages and offered you no benefit. Considering the loan size is so small, I don’t think paying it is gonna affect your installment utilization much though. But it will lower DTI.

Likewise I agree that I would forgo the rental reporting unless you’re trying to app with an institution that you know uses version 9. Otherwise it’s useless and as stated an invasion of your privacy.

Also great advice to file a complaint with the CFPB. Also agree that anything paid is better than unpaid unless it’s soon to fall off.

You’re gonna have to wait for that 30 day late to hit 24 months before you get the majority the points back that you will get.

Based on the above I don’t think you’re going to be in a great position to get property in one year.

I would definitely advise two more non-retail revolvers. When you get them is up to you but there won’t be a new account penalty since you’re in a bankruptcy scorecard. my concern would be when I could get which cards I want based on score. As soon as I thought I was able I would add the two and allow them to begin aging.

From my understanding the best thing you can do with a bankruptcy is get several accounts giving positive payment history as soon as possible. That one 30 day late hurt you decent. I hope you’re able to get it overturned at the CFPB.

Per myFICO: “ As long as the bankruptcy is listed on your credit report, it will be factored into your score. However, as time passes, the negative impact of the bankruptcy will lessen.“

https://www.myfico.com/credit-education/faq/negative-reasons/bankruptcy-types

So actually the scoring penalty for bankruptcies is reduced over time, whenever you go from the recent PR scorecard to the non-recent PR scorecard. I have no idea how much of a gain that is and it would depend on your profile in any event.

Good luck to you.

Re: Im so new to improving credit - please help

Tryinghardtoimprove — Tue, 16 Jun 2020 15:46:35 GMT

Thanks for the knowledge. I appreciate it. I just got approved for $1000 NFCU Visa but was denied for Amazon Store Card. Any suggestions on the second card to get or should I wait for 2 months payments on the NFCU? My credit utilization reported at 4% which I will continue. I'm still going to try in a year for the mortgage in July so I want to garden for at least 8 months prior if not

Re: Im so new to improving credit - please help

Anonymous — Tue, 16 Jun 2020 19:14:49 GMT

Congratulations, an excellent institution to get the card with.

It’s really hard for me to recommend which card because I’m not really familiar with the lenders that are bankruptcy friendly. That would be a question posed in the rebuilding forum to get the best answer.

If you hurry up and get it before that one reports, I’d say go ahead and get it now. If you allow it to report, then you may need to wait three or six months so you don’t appear credit seeking to who you apply to. So you may want to move quickly before it reports.

Re: Im so new to improving credit - please help

Anonymous — Tue, 16 Jun 2020 19:24:04 GMT

I know who to ask. Are you in the BBVA foot print? Now that I think about it I know they are and you can get a rewards card.

@AnonymousWhich lenders are bankruptcy friendly?

Re: Im so new to improving credit - please help

Anonymous — Tue, 16 Jun 2020 19:34:13 GMT

@Anonymous wrote:
I know who to ask. Are you in the BBVA foot print? Now that I think about it I know they are and you can get a rewards card.

@AnonymousWhich lenders are bankruptcy friendly?

All of the ones in my signature apparently 😂

Capital One, Disco, BBVA, and NFCU are the most friendly, Citi is the least. AMEX is in the middle as are most CUs.

I skimmed and I see OP was denied by Synchrony so I left them out.

Re: Im so new to improving credit - please help

Anonymous — Tue, 16 Jun 2020 20:21:42 GMT

Thanks @Anonymous ! I wanted them to be able to see your signature and see all the ones that you got with bankruptcy but I think BBVA may be a good choice due to the rewards.

I would avoid capital one due to bucketing though. Discover may be a good idea as well as you suggested.

Re: Im so new to improving credit - please help

Anonymous — Tue, 16 Jun 2020 20:22:28 GMT

Yeah I would consider BBVA and or Discover

Re: Im so new to improving credit - please help

Anonymous — Tue, 16 Jun 2020 20:44:51 GMT

@Anonymous wrote:
Thanks @Anonymous ! I wanted them to be able to see your signature and see all the ones that you got with bankruptcy but I think BBVA may be a good choice due to the rewards.

I would avoid capital one due to bucketing though. Discover may be a good idea as well as you suggested.

With the scores OP has, BBVA won't likely go there. I just went back and looked. I'm impressed that NFCU approved the OP and it's probably in their best interest to garden at this point and work on settling their balances so the scores recover.

Re: Im so new to improving credit - please help

Anonymous — Wed, 17 Jun 2020 17:15:28 GMT

I did not know you could wash, rinse and repeat that. Good info to know.