topic Re: Okay Here's My Situation in Rebuilding Your Credit

Okay Here's My Situation

Anonymous — Mon, 08 Feb 2010 12:55:58 GMT

I grew up not understanding the importance of credit. My father died when I was 13 so he never taught me. Now that I understand how important credit is, I need to rebuild it. I currently have a credit score of Experian: 549 Equifax: 563 and Transunion: 549. Here is how my credit report breaks down:

Civil Judgement filed 2/3/2005 $1,703. (repossession of a car)

Open account @ Allied INT 4/29/2005 $324

Closed account @ Amsher 5/1/2009 $200

Closed account @ ERC 8/19/2009 $249

Unpaid account @ Nwide 9/1/2009 $1846

Closed account @ Palisades 6/1/2007 $3,744

closed account @ Unique 7/1/2008 $1186

open account @ Unique 6/19/2003 $159

closed account @ AFNI 9/1/2008 $517

Student loans in good standing $23,453

I live in Florida and work in IT. I have been at my current job for about a year now and I am only making about $35k. However, I am coming into some decent money in the near future that I can use to start paying on these accounts.

How should I pay these accounts? All of them are in collections with the exception of my student loans and the judgement from 2005. Do I pay these collection agencies directly in full or should I settle with them? Should I pay the original creditors? Does it make a difference if I settle? How do I want these accounts to be reported on my credit report? Should I pay the judgment? It should fall off in 2 years. My goals are to get my credit score over 700 and purchase a home. A lot of questions I know...thanks for your help!

Re: Okay Here's My Situation

Anonymous — Tue, 09 Feb 2010 02:08:04 GMT

looks like you should invest in lots and lots of stamps.

Your first step will be to get validation of debt (DV) all of those collection accounts. If they respond with valid information, start working on PFD letters. You might be able to pull off settle for deletes on a few. Settled in full doesn't look as good as paid in full, your best option would be to get the charge-offs and collections removed period. If you don't have anything else open in the way of trade lines you might want to consider a few lines to start rebuilding.

Re: Okay Here's My Situation

Anonymous — Tue, 09 Feb 2010 02:54:17 GMT

alo, paid collections and unpaid collections look the same. so your first priority is to get everything deleted when they get paid. Send out DV letters to everyone and see what they come back with. Some might get deleted, and some will not return info at all. Just keep DVing those who return nothing and try to get the info.

Re: Okay Here's My Situation

AndySoCal — Tue, 09 Feb 2010 03:09:34 GMT

Also, I if possible work on the newest derogatory accounts first after getting appropiate DV responses. These accounts are impacting your score more than the older accounts.

Re: Okay Here's My Situation

Anonymous — Tue, 09 Feb 2010 04:11:35 GMT

Thanks everyone for your input...I know all of the accounts are valid. So I don't think there's really a need to validate the debts. I'm curious however, as to how to write a PFD letter. Can I get a PFD letter from somewhere or is there a proper format? I talked to a collection agency earlier and they said they don't delete or remove stuff off of credit reports.

I was really hoping that settling on all of these accounts this month with the exception of the judgement, combined with a secured loan/credit card and good pay history would put me over 600 in a month or two...am I wrong? Or is that being too optimistic?

Message Edited by kinganthony on 02-08-2010 08:11 PM

Re: Okay Here's My Situation

MarineVietVet — Tue, 09 Feb 2010 04:33:39 GMT

@Anonymous wrote:
I grew up not understanding the importance of credit. My father died when I was 13 so he never taught me. Now that I understand how important credit is, I need to rebuild it. I currently have a credit score of Experian: 549 Equifax: 563 and Transunion: 549. Here is how my credit report breaks down:

Hello and welcome to the forums.

One thing I will ask is where did you get those scores? No one has been able to pull their own Experian score since last February. Creditors can pull Experian and also there is a CU in Pennsylvania that supplies that information to it's members only. You can only buy true FICO scores at a few places. One place is here at myfico. I suggest you do an internet search for "myfico discount codes" to save a little money. You can also purchase your Equifax score at www.equifax.com and your Transunion score at www.transunioncs.com.

From a BK years ago to:
7/09 TU-742 EQ- 779
8/09 TU-765 EQ- 783
9/09 EX pulled by lender 802

You can do the same thing with hard work.

Re: Okay Here's My Situation

Anonymous — Tue, 09 Feb 2010 05:18:57 GMT

I paid for my credit report and credit score from all 3 at annualcreditreport.com. I was told that this was a reliable site

Re: Okay Here's My Situation

llecs — Tue, 09 Feb 2010 12:27:50 GMT

kinganthony wrote:
I paid for my credit report and credit score from all 3 at annualcreditreport.com. I was told that this was a reliable site

The score purchased from Equifax.com is a real FICO for EQ only. However, the two scores from Experian and TransUnion are not FICO scores. Their site and info are reliable, but lenders don't use those two scores.

Re: Okay Here's My Situation

Anonymous — Fri, 12 Feb 2010 07:01:45 GMT

just paid one off!!On my way

Re: Okay Here's My Situation

RobertEG — Fri, 12 Feb 2010 08:27:50 GMT

Lots to consider. When it comes to collections, no one can offer firm advice, only options.

There is one primary thing you want to establish once a CA has reported to your CR. That is critical.

What is the DOFD on the OC account that led up to the CA? Important for two reasons.... it affixes the date that the CA must drop from credit reporting (7 1/2 years from the DOFD), and,

IN most most states, it also sets the date of running of the statute of limitations for legal action.

How to pay a CA has many options. It is like being at a craps table it Vegas.

A risk taker will go for it all, and offer the CA a PFD. If they accept, it fullfills the debt, and if granted in prior written commitment, will remove it from your CR, and thus FICO scoring. But risky because it is just a conditional offer that they dont even have to respond to. And apparently, your CA has already told you that they dont do deletions. You can still dangle money in their face, and take your chances. But not a great bet.

If you are conserative in risking futher CA action, you just pay in full (PIF). This discharges the debt, and clears the table. but only updates CA status, which does not remove it from credit scoring.

The highest step in risk taking is to ignore the CA, You do this if you have no intent on paying the debt, and are wiilling to risk legal action against you.

If you take that step, you had better know your state statute of limititations (SOL) before your day in court.

Re: Okay Here's My Situation

Kimberly68 — Fri, 12 Feb 2010 19:45:45 GMT

your best bet is to pay for delete, DV also re-age your account. I have seen it many times with my own report. When i call them they never give me any information, but I was lucky, it fell off on its own.

If you are looking to purchase in the near future, this may cause problems, but if not for a year or 2 you are ok to pay, BUT PLEASE KEEP ALL RECEIPTS.

Re: Okay Here's My Situation

Anonymous — Fri, 12 Feb 2010 19:48:56 GMT

@Kimberly68 wrote:
your best bet is to pay for delete, DV also re-age your account. I have seen it many times with my own report. When i call them they never give me any information, but I was lucky, it fell off on its own.

If you are looking to purchase in the near future, this may cause problems, but if not for a year or 2 you are ok to pay, BUT PLEASE KEEP ALL RECEIPTS.

DV do not re-age the account. It may cause them to update it but not re-age. Two totally different things.

Re: Okay Here's My Situation

Anonymous — Fri, 12 Feb 2010 19:49:30 GMT

DVing does not re-age an account to my knowledge. The date for an account to fall off is based on the DOFD only. I know there are some laws that reset SOL, but never re-ages the account itself.

Re: Okay Here's My Situation

Anonymous — Fri, 12 Feb 2010 19:52:06 GMT

Re-aging would mean that the DOFD had been changed. Can't be done, illegal. I believe the OP means they updated her account, which probably dropped the score. Many people confuse re-aging with updating.