topic Re: Building and Boosting in Rebuilding Your Credit

Building and Boosting

Anonymous — Fri, 02 Sep 2011 02:54:30 GMT

This is my first post.

We have no debt and no credit cards. Who knew this was a bad thing!

We live very frugally and are probably considered poverty level poor by U.S. median standards. My husband has been employed with the same company for over 30 years. I was employed for over 30 years myself, but now, am unable to work because -- well, I'm getting old and have a lot of health issues. I've tried and tried to get Social Security Disability but, my attorney keeps having to file appeals. All of that to say -- we are a one-income couple in our 60s.

My husband's truck (our only transportation), was repo'd in 2009. We just couldn't afford it and, with my health issues freaking us out, we weren't thinking clearly enough to try to refinance it. The truck sold at a car auction and we received a little over $600 back from that. We've been taking the bus ever since.

We'd like to get an inexpensive car but, when we went to the car dealerships and they filled out the credit application, they all kept saying: "You have no FICO score, the only thing on your Credit Reports is a Repo from 2009." Goodbye!

SO---we are in the process now of getting a secured credit card through Orchard Bank and doing the Rebuild Rock.

I am reading, from other threads on here that, some of you folks have rebuilt your credit and boosted your credit with amazing speed. And, I particularly like some the methods and techniques that I have been reading about.

I told my husband:"There's hope for us yet! We may not be relegated to riding the bus forever after all!" We are looking forward to learning more from all of you, and even becoming wise stewards with our meager fare.

Re: Building and Boosting

Booner72 — Fri, 02 Sep 2011 03:41:40 GMT

Hi there! I think you can get a credit score pretty fast. It's easier to build a credit score than to repair one that is damaged. It is my understanding that you need at least three active tradelines reporting for six months to generate a score. So that means get three accounts ASAP- if you have to go to your bank or credit union and open up a couple of secured cards that way. Orchard Bank is a good start -

Only let ONE of the three accounts report a very small balance - about 5% of it's credit limit. So say the limit is 500.00 - have it report 25.00. The other two should report a zero balance. You can use them, just pay in full by the due date. The STATEMENT DATE is the date that the info is reported to the credit bureaus - so say you paid if off by the due date, but then used it again - that amount would be on the statement and thereby, reported. Having anything more than 30% of your credit limit report is not going to do you much good for your score, and it sounds like your score is your goal.

I hope that some of this info helps!

What is Rebuild Rock?

Re: Building and Boosting

Anonymous — Fri, 02 Sep 2011 04:14:36 GMT

Thank you Booner72 for your quick reply!

I'd say doing the Rebuild Rock is what everyone on this portion of this website is actively engaged in to reach their desired goal.

In addition to Orchard Bank, we are thinking we should also try for a Capital One secured card, and perhaps one with First Progress as well. We're just not sure how much time we should have between applications. What do you suggest?

Re: Building and Boosting

MarineVietVet — Fri, 02 Sep 2011 12:18:06 GMT

@Booner72 wrote:
Hi there! I think you can get a credit score pretty fast. It's easier to build a credit score than to repair one that is damaged. It is my understanding that you need at least three active tradelines reporting for six months to generate a score. So that means get three accounts ASAP- if you have to go to your bank or credit union and open up a couple of secured cards that way. Orchard Bank is a good start -

Only let ONE of the three accounts report a very small balance - about 5% of it's credit limit. So say the limit is 500.00 - have it report 25.00. The other two should report a zero balance. You can use them, just pay in full by the due date. The STATEMENT DATE is the date that the info is reported to the credit bureaus - so say you paid if off by the due date, but then used it again - that amount would be on the statement and thereby, reported. Having anything more than 30% of your credit limit report is not going to do you much good for your score, and it sounds like your score is your goal.

I hope that some of this info helps!

What is Rebuild Rock?

That's not exactly true. In order for a FICO® score to be calculated, a credit report must contain these minimum requirements:

At least one account that has been open for six months or more
At least one undisputed account that has been reported to the credit bureau with in the past six months
No indication of deceased on the credit report (Please note: if you share an account with another person this may affect you if the other account holder is reported deceased

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

Re: Building and Boosting

Anonymous — Fri, 02 Sep 2011 12:57:32 GMT

@Anonymous wrote:

In addition to Orchard Bank, we are thinking we should also try for a Capital One secured card, and perhaps one with First Progress as well.

I think the Capital One secured card would be a good next step. They report quickly, they don't report as "secured," and I like their website's ease of use (my hubby has a secured card and it has really helped to boost his scores). Keep in mind, though, that they pull from all three agencies, so you will have an inquiry across the board (as opposed to some lenders who only pull from one or two agencies).

Good luck!

Re: Building and Boosting

Anonymous — Fri, 02 Sep 2011 16:44:10 GMT

Thank you to everyone for your good inpuut!

I've pulled all 3 CRs for both my husband and myself. The Repo of his truck appears on his CR, but not mine. We both have some old derogatory info on both our reports, most all of which states that it will come off early next year. There is one derogaory charge on my TU and EX for an ambulance that I am going to try to fix with a PFD since I never received a bill for that particular ride to the hospital and, it isn't scheduled to come off the CR until 2013. There is a CA on my husband's CR for the gas company which we will dispute since we neither one have any idea what that's all about, and it says its not scheduled to fall off his CR until 2014.

My husband is going to check to see what Credit Union his company is affiliated with. We've had our bank account with Chase (formerly Washington Mutual), for several years but, they are not a friendly bank at all. We've had several disputes with them over debit transactions and they have always said we were in the wrong, no matter what. We have in mind to keep our account with Chase open but, not use it as much. We'd like to switch to either US Bank or a Credit Union for primary banking. We are thinking we'd like to go with US Bank's secured credit card in addition to Orchard (which we've already established--we're just waiting to receive the card), and Capital One, which we established this morning, we're just waiting on the card from them too. These accounts are in my husband's name. I have not opened anything in my name yet. I'm not sure its necessary since I have no income.

Hopefully, by this time next year, we will have 3 CC accounts reporting positively for my husband, all the old baddies will have fallen off, and only the Repo will remain. By this time next year we may even be able to get Toyota Financial to remove the Repo, the truck sold at auction and we got over $600 back, it won't hurt to try to get the Repo taken off the CR. We both are anxious to have a vehicle once again but, we realize its going to take until at least this time next year for him to have any kind of FICO. We KNOW that our interest rate on the vehicle will be steep, but, it will be refinance-able down the line. We are just thrilled to know that there is "some" hope for us after all.

Thank you again to all of you for your encouragement! We really appreciate it.

Re: Building and Boosting

Anonymous — Fri, 02 Sep 2011 18:08:24 GMT

Chase doesn't have a secured card and IMO their regular cards are quite hard to get, at least for someone with little to no credit. I'm in the same boat as you, starting my credit up and I had GREAT success with Bank of America. Just go in and talk to a banker. I do believe opening a checking account with them also boosts your chances. And they are very quick at getting that card out to you as opposed to Cap1 who I also have and they are VERY slow about the process. Good luck on your road to good credit =)

Re: Building and Boosting

Booner72 — Sat, 03 Sep 2011 16:02:05 GMT

Sorry I said 3 tradelines reporting instead of 1 to generate a score. Big OOPS.

I would strongly recommend avoiding banks and going to CU's. Banks always get you with fees and crap and they're a conglomerate and CU's are small and local.

Re: Building and Boosting

Anonymous — Sat, 03 Sep 2011 18:39:54 GMT

Again, thanks for the good input everyone!

We are waiting on Orchard Bank and Capital One to send their secured CCs. My DH wants a 3rd secured CC because he wants 3 TLs reporting even though, as has been stated, one is sufficient. He opened a bank account wih USAA Bank yesterday and wants to let our current account with Chase become secondary. Through USAA, he is eligible for a secured Amex card so, that's what he has decided to do. He looked at joining Wescom Credit Union since they are local and, he says he might do that down the line. The company that he works for is affiliated wih Corning Credit Union back east in New York, so he has that option too. He had considered getting a secured CC from First Progress and US Bank but, after checking out all the options from USAA, Wescom CU and Corning CU, for now, he is going with USAA.

Thank you for the advice from Booner 72 that read:

"Only let ONE of the three accounts report a very small balance - about 5% of it's credit limit. So say the limit is 500.00 - have it report 25.00. The other two should report a zero balance. You can use them, just pay in full by the due date. The STATEMENT DATE is the date that the info is reported to the credit bureaus - so say you paid if off by the due date, but then used it again - that amount would be on the statement and thereby, reported. Having anything more than 30% of your credit limit report is not going to do you much good for your score, and it sounds like your score is your goal."

Sounds like a simple and easy plan to start with.

Can you tell me if increasing the CL on the cards helps? Does a card thats reporting a CL of $1,000 boost the FICO score? I keep reading on here about people aiming for CCs with really high CLs, and I'm wondering how the FICO math/algorythms react to that?

Re: Building and Boosting

Booner72 — Sat, 03 Sep 2011 20:35:06 GMT

A high CL will help only if you need to to help your utilization.

FICO doesn't care if your CL is 200 or 2000 - It's the utilization that is scored, both overall and for each card reporting.

Other FAKO scoring systems (like freecreditscore.com) say that having low limits is bad for your score. This is not true for FICO.

Re: Building and Boosting

Anonymous — Sun, 04 Sep 2011 07:02:48 GMT

We're still trying to wrap our heads around this term "utilization" even though we've read over and over again that its "balance divided by credit limit equals percentage" and that "lower than 10% is recommended" per account. I think once we get into receiving our first CC bill, and we see how quickly payments are received, and annotated, maybe we will get the hang of things. Charging less than 10% is great for our meager budget. We don't need any heavy burdens while we are trying to save some money for a down payment on a car.

Wow! To have a car again one of these days, we won't know how to act.

Re: Building and Boosting

Booner72 — Sun, 04 Sep 2011 15:22:26 GMT

HI discernment - yep, you've got it right. It's the percent of available credit you are using. FICO also scores TOTAL utliity, so say your card limits are 500, 400, 300. Your total available credit would be 1200.00 - ( you wouldn't want to be using much of your total credit either )

FICO also scores HOW MANY of your revolving accounts (cc's) are reporting balances. They don't like to see them all report balances, either.

So for optimal pointage, have only one account report one small balance 1-9% of your total available limit.

Re: Building and Boosting

Anonymous — Sun, 04 Sep 2011 17:51:59 GMT

This is kinda confusing. On one hand you say you and your husband have no FICO score, yet when you pulled your credit reports, you just mentioned the deragatory information listed in them. If a vehicle was repo'd, then you had installment loan which definately adds & subtracts from your score. Even more so then a credit card.

Re: Building and Boosting

llecs — Sun, 04 Sep 2011 18:18:13 GMT

@Anonymous wrote:
This is kinda confusing. On one hand you say you and your husband have no FICO score, yet when you pulled your credit reports, you just mentioned the deragatory information listed in them. If a vehicle was repo'd, then you had installment loan which definately adds & subtracts from your score. Even more so then a credit card.

The repo would have to be actively reporting and reporting as "open". Assuming the OC still owns the debt and reporting a balance, they aren't likely updating monthly and reporting as open as being a two-yr old repo. A requirement of FICO scoring is that at least one account most be open and actively reporting. FICO scores CCs much more heavily than installment loans too. I bet OP would see a very significant increase one the first CC reports, well, had there been a score now. In 6 months OP will have one.

Re: Building and Boosting

Anonymous — Sun, 04 Sep 2011 21:07:55 GMT

Thank you IIecs for your input regarding the accounts "last reported" date. The ONLY account that is currently and actively reporting anything, and there is "one," is a CA called: "Progressive Managment Sysems" who are reporting that the OC on that account was Southern California Gas Company. Why they are reporting anything at all is a mystery to us because when we paid the final bill before moving from that residence 6 years ago, we even got a refund back from the Gas Company for "overpaying" too much on their final bill. We wrote a DV letter to the Gas Company enclosing photocopies of the final bill and the refund on the 15th of August (last month), but, we've yet to hear anything back from them. The only CRAs reporting this nonsense are Experian and Transunion.

Our repo was handled by Toyota Financial ONLY, and, it is reporting a zero balance because, when the truck sold at auction, we got more than $600 back from the sale. The "last reported" date on that account is October of 2009.

Hopefully, that will clear up any confusion that JoeyBagadonuts24 had.

When I tried to open an account here on this website with the Equifax product this is the message I received:

Thank you for visiting myFICO.com®.

We regret that we cannot provide you with your FICO® score report as your report at Equifax does not meet the minimum scoring criteria. If you were using a credit card, it was not charged.

If you have not already done so, you may want to try ordering your credit report from the other national credit bureau - TransUnion. In addition, your non traditional credit data may be reported to alternative credit reporting agencies and Fair Isaac Credit Services, Inc. can help you get access to this information if present.

Please call Fair Isaac Credit Services at 1-866-838-3427 to obtain a copy of your Fair Isaac Credit Services consumer report.This report does not include a score.To expedite the call, please specify to the representative that you are interested in obtaining a copy of your Fair Isaac Credit Services consumer report. For any additional questions regarding myFICO.com, please call myFICO.com customer service at 1-800-319-4433 Monday - Friday 6:00AM - 6:00PM or Saturday 7:00AM - 4:00PM PST.

Thank you
myFICO® Customer Care

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When I tried to open an account here on this website with the TransUnion product this is the message I received:

Thank you for visiting myFICO.com®.

We regret that we cannot provide you with your FICO® score report as your report at TransUnion does not meet the minimum scoring criteria. If you were using a credit card, it was not charged.

If you have not already done so, you may want to try ordering your credit report from the other national credit bureau - Equifax. In addition, your non traditional credit data may be reported to alternative credit reporting agencies and Fair Isaac Credit Services, Inc. can help you get access to this information if present.

Please call Fair Isaac Credit Services at 1-866-838-3427 to obtain a copy of your Fair Isaac Credit Services consumer report.This report does not include a score. To expedite the call, please specify to the representative that you are interested in obtaining a copy of your Fair Isaac Credit Services consumer report.

For any additional questions regarding myFICO.com, please call myFICO.com customer service at 1-800-319-4433 Monday - Friday 6:00AM - 6:00PM or Saturday 7:00AM - 4:00PM PST.

Thank you
myFICO® Customer Care

----------------------------------------------------

I did not check to see if we had a FICO score with Experian because after everything I've read on here, I would not be getting a true FICO score from them.

Hopefully, this clarifies everything for any other readers who may have had any confusion.

Re: Building and Boosting

llecs — Mon, 05 Sep 2011 00:02:07 GMT

MarineVietVet outlines the scoring requirements on the previous page. If you open an account now, then in 6 months you'd have a FICO score assuming that account reports as open and reports monthly (and is undisputed).

Re: Building and Boosting

Anonymous — Tue, 06 Sep 2011 01:24:47 GMT

Well, an interesting development! I stated in my previous post here that the FICO product for TransUnion told me they would NOT charge my bank account the $4.95, however, when I signed on to our Chase account to take a look at my online balance, I see that indeed MyFICO did debit our account the $4.95 and also made two other debits of $1.00 each. What's up with that?

We don't mind having the TransUnion service for $4.95 but, I don't know how to access it and clicking on "My Accounts" doesn't tell me anything. I don't see any Credit Report available there nor any Credit Score.

Can anyone help me with this?