topic Re: Not sure where to begin? Help! in Rebuilding Your Credit

Not sure where to begin? Help!

ACN323 — Fri, 17 May 2019 19:15:42 GMT

Hi everyone,

5 months into my rebuild and not sure what to do. For some background info my scores are: 543 Equifax and 525 Experian. Not sure Of Transunion. In December of 2018 I applied for a Citi Secured card with a $200 deposit, I use it monthly for small purchases and a $5 monthly subscription charge, and never carry a balance. That has definitely bumped my score up a little over the last few months. I have one collection for $691, an old Capital One that went to Portfolio Recovery Assoc, and one charge off from another Capital One card for $3096. Both of those went delinquent in 2016, but aren't coming off my credit report anytime soon, making my revolving utilization like 124% or something crazy. I read that PRA will do pay for deletion, but the other charged off Capital One, hasn't been sold to a collection agency that I know of yet.
I only have 1 inquiry from my Citi card and that's it.

Do I pay these collections/charge offs, or just leave them? My only qualm with doing so is, I'm a stay at home mom, and my husband is our sole income earner, has been for a few years, and will be until our youngest goes to school next Fall...All of our bills- mortgage, utilities, cell phones, etc etc. are in his name. He knows my credit is pretty bad right now, but doesn't know the extent of my two collection accts. We don't really have a ton of extra cash laying around to pay off these accounts, and I certainly would feel pretty terrible if we did, using it to pay for mistakes I made a few years ago.

Long story short, will my scores increase with continuous responsible use of my secured card and not paying the two collections? Or is it pointless and I need to pay them to see a major score increase? Any useful info would be greatly appreciated! Thanks!

Re: Not sure where to begin? Help!

dynamicvb — Fri, 17 May 2019 19:42:23 GMT

Are the collections updating fresh every month with an updated date? If they are then they are going to hold you down and it won't help, much to get positive history with the secured card. If they are not updating and aging, then you may get some movement, but just the prescience of them will hold your scores back until they fall off. I do think the portfolio will delete it its over 2 years and you may even be able to settle for less. Search around this forum and you will find some threads of what others have been able to accomplish.

Re: Not sure where to begin? Help!

ACN323 — Fri, 17 May 2019 19:50:54 GMT

Thanks for your response! They are updating fresh every month, sadly. I will definitely search around a little more on other threads to see if I can get some more info. May just have to bite the bullet and see if I can settle at some point with PRA when I have the $$.

Re: Not sure where to begin? Help!

DIYcredit — Sat, 18 May 2019 06:29:26 GMT

A monthly collection update will not effect your Fico score. When the collection was opened/first reported determines how old the collection is and dofd will be the date when it will be purged from your cr.The collection will hold down your credit score because it is a serious derogatory.Continue building a positive history of monthly on time payments with the secured cc and pay down the cc debt to 1-6%.GOOD LUCK...

Re: Not sure where to begin? Help!

simplegirl — Sat, 18 May 2019 11:23:42 GMT

I would say if something is holding down your credit score then it is definitely effecting it. So yes pay portfolio because they do delete no matter if you pay in full or settle.

Re: Not sure where to begin? Help!

Jannelo — Sat, 18 May 2019 13:07:34 GMT

I can only give you my experience, because I was where you were with Cap 1, two charge-offs. I didn't do a thing towards addressing it. I had a Cap One Platinum charge-off, which was only $140. The other, Quicksilver 1, was $3966. They came from around the same time as yours. Once I became active in cleaning up my credit and getting a secured Green Dot Card, etc. I paid a couple of collections that appeared on my credit report. So seeing I was active again (I think). Portfolio swooped in and bought the low debt one, the $140. I could have easily before that called Cap 1 and taken care of paying off the charged account. Now Portfolio wanted like $600 or something. I was new to all of this and settled for a reduced amount, but paid way more than if I had just addressed it head on earlier with Cap 1. I now knew it was just a matter of time before someone bought the larger debt from the 3966 Cap 1 charge-off. So I contacted Cap 1 and began a monthly paydown on that debt. I guess I could settle for maybe half the amount, but didn't want to deal with IRS on what I didn't pay and wanted it on the credit report it is paid in full. They asked me what I wanted to pay. I said $200 a month. One month I paid $400. But I don't think it's written in stone. I'm sure if I could only manage $100 for a few months it would be fine. I came up with the $200 a month. They see I am diligent with paying it off and haven't hassled me. I am officially this month now down to $1966. Some days I just want to call them and ask for a settlement offer and get rid of this and pay less. But I keep reading on here it does look better if I paid it off in full.

I have read up on Cap 1 and turning over to collections. I had a real fear if I didn't pay it would eventually get filed and I would have a judgement against me for it, now racking up more fees, attorney fees for them to bring me to court. I would suggest taking care of it, whether calling them and setting up a payment plan or asking for a settle-for-less offer. It will not be a pay for delete with them (from what I read), but at least it shows you are taking care of it.

Regrading the $140 that went to collections for Cap 1. It was Portfolio that bought it. They refused a pay for delete. But a few months after I settled with them, it disappeared off of my credit reports. I read on here that that is their practice now, to delete. It still shows up under the old Cap 1 account as a charge-off, but says I settled and 0 balance.

Oddly enough, while still owing them, I received a new Capital One Platinum last August, and received a Capital One Quicksilver 1 with a $1000 SL a month or so ago.

Re: Not sure where to begin? Help!

ACN323 — Sat, 18 May 2019 21:22:28 GMT

Jannelo, good to know about Cap1. I will probably and try to reach out to them soon when we have some extra cash. They keep reporting each month. I just got a score alert and my score only went up 1 point this month from secured card reporting my payment. Pretty discouraging.
I agree with everyone here, that until I pay these my scores not going to shoot up.
Thank you all for the helpful info! Appreciate this forum so much!

Re: Not sure where to begin? Help!

Jannelo — Sun, 19 May 2019 00:47:45 GMT

Thanks. Also, looking at when you got your secured card, you should go ahead now and get another to help your scores. After I got my first secured card, and after reading on here how in a rebuild you need to slowly end up with three, I got my second one. I just tried to prequal for Capital One for secured (even though I had burned them with two cards) and was shocked they pre-qual'd me for an unsecured Platinum. I grabbed it. Okay. It was only $300, eventually credit stepped up to $500, but I was in the low 520s when I got it. I felt lucky to even get a card that wasn't secured.l My credit score jumped after it reported. Then seven months later is when I got a third, and my credit score jumped another six points. I spaced it out. I didn't run around trying to get a lot of cards I couldn't get or try to get too many or have a bunch of hard pulls. I just followed the advice of the wise people who have been through it on here.

Go on sites to that will let you see if you prequalify for it. They are all soft pulls when they do that, not hard pulls. Merrick Bank, in six months will double your starting limit. They have a pre-qual feature. I think they have some fee in the beginning, though. Go on Capital One and see what you qualify for. You might be surprised. Go on Discover and see if you pre-qualify for the secured or unsecured card. You will need a second card so you can start creating a postive history of credit and paying on time to offset the bad history.

The rebuilding adivice on here is three bank credit cards and one installment loan (like a car or self-lender loan) is optimum for the rebuild. Over the past year that is what I've worked towards while, most importantly, paying down the charged-off debt and collections and trying to save at the same time.

Re: Not sure where to begin? Help!

ACN323 — Sun, 19 May 2019 01:02:43 GMT

I will for sure look into another secured card. I did actually prequalify for a Discover Secured. I've read really good things about it, so I may try and give that one a go in a month or two. One of my charged off Cap1 accts started as a secured card, and it really was a great card for building my credit at first. Ugh, so annoyed with myself for letting them both get to the collection stage. Lesson learned! My goal is to start paying on the charge off and try to settle and do PFD with Portfolio, and get that Discover Secured. I'll give an update on my progress when I get there. Also, goodluck on your rebuild. Sounds like you've made some solid strides!

Re: Not sure where to begin? Help!

Anonymous — Thu, 06 Jun 2019 11:17:41 GMT

Hello Jannelo,
I saw your post about using cap one auto with your fico score. Did you need a downpayment? Im currently rebuilding, im at 650 fico and one 5 yr old settled auto charge off
Thank you

Re: Not sure where to begin? Help!

Anonymous — Thu, 06 Jun 2019 12:13:45 GMT

I will add here that you don’t want to just ignore the CapOne debt - they will sue you to obtain judgment and garnishment if possible. Doing what was stated and approaching them for a payoff plan is the right move.

Regarding the PRA collection, definitely settle that and take care of it. They will delete it once it’s handled, for full amount or less as stated above.

Also, I would sit down with your husband and let him know what’s going on. Hiding money issues rarely works well and most people have a financial skeleton or two lying around. My guess is he will be interested in you clearing these as well - it only stands to benefit your entire household in the long run.

Re: Not sure where to begin? Help!

ACN323 — Thu, 06 Jun 2019 13:47:44 GMT

ImTheDevil, yes was just reading about Capital One suing someone. Gave me such anxiety last night and this morning thinking about it. I will for sure sit down and spill the beans. Just a lot of guilt due to the fact that I'm not contributing financially. I know being at home with our kids until they can both be in school is equally important and contributing, but I've always worked prior to having our children, so I myself just feel like I have the lower hand now that I'm at home and can't work at the moment, to repay my own debt. I know it shouldn't be looked at that way, my husband is pretty understanding, but it's just another one of those "really?" moments I want to avoid. Thanks for your advice and I will for sure sit down with him, sooner than later.

Re: Not sure where to begin? Help!

Anonymous — Thu, 06 Jun 2019 13:53:04 GMT

Excellent. I think it’ll go better than you’re fearing. As you said, contributing to the family is more than just financial and I’m sure he knows that. What’s good for the family is something that anyone will embrace. My wife had those same thoughts awhile ago because she makes about half what I make and felt she wasn’t holding up her end of the deal. What she realized after we discussed it many times, and I hope you also realize, is that it’s a partnership. You contribute in your way, he does in his, and the household moves forward. It doesn’t have to be financially equal or even financial at all. At my house, we have a joint account, both paychecks go in, and WE pay OUR bills out of OUR money, not me paying from mine and she from hers. It’s anazingly refreshing to get that mindset and stick with it

Re: Not sure where to begin? Help!

ACN323 — Thu, 06 Jun 2019 14:32:38 GMT

Agree, 100%. Great dynamic you guys have! Hoping in the future with two incomes we can go that route with joint finances. Also, thank you, child rearing has been more intense, but also more fulfilling than anything I've done previously in life 😜 I know my kids will look back and be thankful I was there. Hopefully! Appreciate your understanding and kind words!

Re: Not sure where to begin? Help!

Anonymous — Thu, 06 Jun 2019 14:42:17 GMT

You can count on that about your kids. I have three (15, 14, and 8) and it’s definitely a handful, but when you’re as fully invested in something as you are in your kids, you refuse to fail. It’s not easy but parenthood is the most difficult job that I’d never quit.

Have that chat - I think you’ll come out of it relieves and with a plan to move your profile forward and to the positive. All the best to you

Re: Not sure where to begin? Help!

Jannelo — Thu, 06 Jun 2019 20:16:22 GMT

@Anonymous wrote:
Hello Jannelo,
I saw your post about using cap one auto with your fico score. Did you need a downpayment? Im currently rebuilding, im at 650 fico and one 5 yr old settled auto charge off
Thank you

Katy1, I can't remember if it required me to have a down payment when I pre-qualified. For the pre-qual I don't think it did. But I always planned to have a down payment. Once they pre-qualified me and you are now on their Navigator site, when you click on a car, you pick the terms as far as how long of a car payment you want and the price, and it tells you what your interest rate is. You can build a lot of loans on different cars and save them as you figure out which cars you want to go look at. You input there your down payment or no down payment. If it isn't acceptable, they will let you know this offer isn't good. I think the only terms I had in the pre-qual acceptence was I had to have a loan over $4,000. There may have been a cap to the loan of $35,000 or so. I don't remember. I knew I was never going that high, so it didn't matter. It really depends on the size of the loan you are going for and your income, etc., I would imagine, as to whether they require a down payment. I don't think I needed a down payment on the size loan I got, but I never tried to build a loan without a down payment on the estimate box on their Navigator site when I was looking at different cars. So I don't know.