topic Credit Rebuild Question in Rebuilding Your Credit

Credit Rebuild Question

justjess — Thu, 03 Mar 2022 15:25:37 GMT

I am trying to rebuild my credit ahead of applying for a mortgage and eventually business credit for a business I own. In the last two years I have gotten my scores up significantly, I do not remember exactly where they started but they were in the fives and I had no available credit whatsoever. FICO currently EX 661 EQ 641 and TU 625. I paid a collection in full about a week ago which still is not reflected in EQ or TU. I currently have one credit card with discover with 1500 CL and 8% utilization. I had a second card with Wells Fargo but they canceled it for no use. I have two car loans with perfect payment history and student loans that have been current since 2018 with many lates before that which I know I can not do anything about.

I have two remaining negatives on my report one collection which will fall off in december and has not reported in gears so I am not concerned about and the other (a collection and charge off for the same account) which will not fall off until 2025. I am stumped on what to do with the second one. SOL for that runs out in September of this year. The balance is $7800.

Backstory - in 2017 I was in a desperate place with no credit and very little money. The transmission on my car blew and I needed another one. I purchased a car from one of those buy here pay here places (JD BYRIDER) because it was the only place I qualified for a car and I live in an area where you NEED a car because there is no public transport and it is not walkable. They sold me a bumper to bumper warranty with the car but it could only be serviced at the dealer. A week after buying the car it started having issues. Every time i brought it in to be looked at they told me there was no mechanic available because he was away with the national guard. I ended up having to take it to different mechanics and paying thousands out of pocket for repairs. A year after purchasing the car the engine caught fire and the car was totaled out. It was not repairable. JD BYRIDER would not honor the warranty or do anything to rectify the situation so I stopped paying them. I contacted the office of the attorney general in my state and the CPFB but neither would do anything. Other states have filed class action lawsuits against this same company for the same exact things I went through and have won against them with restitution being JD BYRIDER removing all reports from impacted customers credit reports. I do not want to pay these people. They are predatory lenders and they committed fraud against me with this transaction - the whole situation runs afoul of both federal and state trade laws. But at the time this happened I did not have a dollar to pursue suing them myself and when the AG and CFPB declined to do anything I just let it go. I somewhat successfully disputed this off both EX and EQ - the charge off is still there but the collection is gone. TU won't budge.

Do I have any options other than paying this? And if I pay it am I risking making things worse since it's still within SOL in my state until September?

Also.. should I get another credit card or two or wait? I read you should have three but I don't know if it's worth the HP hit to my credit?

Re: Credit Rebuild Question

FireMedic1 — Thu, 03 Mar 2022 21:16:56 GMT

Anything thats settled/paid looks better to future creditors. Since the SOL isnt done yet. Dont let them go legal as a last attempt to collect. Get it in the past. Sorry it happened. After it reflects $0 balance. Then yes go after a couple cards to hit the FICO rebuild bonus per say. You got loans. So no loans at all. Then. Life moves on.

Re: Credit Rebuild Question

justjess — Fri, 04 Mar 2022 20:31:39 GMT

so there is no specific way to try to address a negative item that resulted from fraud and violations of fair trade practice and consumer laws?

also if i pay the collection line item will the charge off update? it already says balance 0

@FireMedic1 wrote:
Anything thats settled/paid looks better to future creditors. Since the SOL isnt done yet. Dont let them go legal as a last attempt to collect. Get it in the past. Sorry it happened. After it reflects $0 balance. Then yes go after a couple cards to hit the FICO rebuild bonus per say. You got loans. So no loans at all. Then. Life moves on.

Re: Credit Rebuild Question

OmarGB9 — Sat, 05 Mar 2022 00:08:22 GMT

@justjess wrote:
so there is no specific way to try to address a negative item that resulted from fraud and violations of fair trade practice and consumer laws?

also if i pay the collection line item will the charge off update? it already says balance 0
@FireMedic1 wrote:
Anything thats settled/paid looks better to future creditors. Since the SOL isnt done yet. Dont let them go legal as a last attempt to collect. Get it in the past. Sorry it happened. After it reflects $0 balance. Then yes go after a couple cards to hit the FICO rebuild bonus per say. You got loans. So no loans at all. Then. Life moves on.

Well, at this point your only recourse would be to lawyer up and sue them.

If the charge off already says zero, then they either discharged the debt or sold it completely to a CA.