Wait or Do it now?

[Anonymous]

I need a little help...

I currently have 3 baddies, all three of which are credit cards from almost 7 years ago.  One is expected to come off my reports in July and the other two in November.  Because of the nearly 7 years of interest and balance increase on those accounts they all show over 100% util.  When they drop off I will not have any credit lines and no util unless I open a new card account.  In fact the only open account of any kind I will have is my student loan for $24k (perfect history).  Everything else (the car, the boat, etc) is paid off now (all with good history).

Knowing that util is a large portion of one's FICO score I am considering opening a new Credit Card account but I have a delima of sorts.  Should I wait until the others come off or do it now.  What concerns me is this - My score will improve after these come off but probably by only 30-40 pts.  This puts me in the mid 600's or if I'm lucky maybe higher.  I could possibly get a better card offer at that time.

However, if I do it now I will have a few months of history and since I do not have plans to use the card I will end up with great util, under 10% is the goal.  Which should I do?  Will I end up with a much better score by the start of 2012 by getting a new card now or waiting until December after the old baddies have gone bye-bye?

Also - I should mention that the two baddies that come off in November are CAP ONE,  should I stay away from CAP ONE and go with someone else or will they even care since these are so old?

Thanks

[p-]

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@Anonymous wrote:

I need a little help...

I currently have 3 baddies, all three of which are credit cards from almost 7 years ago.  One is expected to come off my reports in July and the other two in November.  Because of the nearly 7 years of interest and balance increase on those accounts they all show over 100% util.  When they drop off I will not have any credit lines and no util unless I open a new card account.  In fact the only open account of any kind I will have is my student loan for $24k (perfect history).  Everything else (the car, the boat, etc) is paid off now (all with good history).

Knowing that util is a large portion of one's FICO score I am considering opening a new Credit Card account but I have a delima of sorts.  Should I wait until the others come off or do it now.  What concerns me is this - My score will improve after these come off but probably by only 30-40 pts.  This puts me in the mid 600's or if I'm lucky maybe higher.  I could possibly get a better card offer at that time.

However, if I do it now I will have a few months of history and since I do not have plans to use the card I will end up with great util, under 10% is the goal.  Which should I do?  Will I end up with a much better score by the start of 2012 by getting a new card now or waiting until December after the old baddies have gone bye-bye?

Also - I should mention that the two baddies that come off in November are CAP ONE,  should I stay away from CAP ONE and go with someone else or will they even care since these are so old?

Thanks

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Tough call.  If it was me, I would get a card from someone like Orchard, or maybe a secured card like the Wells Fargo that has the chance of graduating to unsecured.  Both ff these do not have a high threshold of approval.  Or you could try for a better one at the same time.  Maybe you get it, maybe you don't, but the inq's will all be irrelevant after a year anyway.

[slarano]

I'd wait until everything falls off before doing anything you're planning to do. You've waited almost 7 years, what's a few more months?

[Wolf3]

My understanding is that the negative information is removed after 7.5 years.   But the accounts are supposed to stay on the CR for 10 years.  I think waiting is in order. 

[Anonymous]

Wolf3,

I think I can help shed some light on that.  I pulled all 3 reports back in early November 2010 and the TU and EX reports both gave the dates for the items to come off.  Doing the math backwards to the date of last activity it works out to be right at 7 years.  I had another baddie that came off in JAN 2011 just as the reports had suggested.  It was right at 7 years from the last activity date and the whole CL was removed not just the negative information.

Now it may still be true if I had just lates on those CL's but these were charged off accounts as bad debt.  I dunno???

In some ways I wish the CL would stay and just the bad info would go because I will loose 2 years of credit age as these are my oldest listed accounts.  Good thing is that I have a car loan from about a year afterwards so I'm not expecting a big difference.

[p-]

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@Anonymous wrote:

Wolf3,

I think I can help shed some light on that.  I pulled all 3 reports back in early November 2010 and the TU and EX reports both gave the dates for the items to come off.  Doing the math backwards to the date of last activity it works out to be right at 7 years.  I had another baddie that came off in JAN 2011 just as the reports had suggested.  It was right at 7 years from the last activity date and the whole CL was removed not just the negative information.

Now it may still be true if I had just lates on those CL's but these were charged off accounts as bad debt.  I dunno???

In some ways I wish the CL would stay and just the bad info would go because I will loose 2 years of credit age as these are my oldest listed accounts.  Good thing is that I have a car loan from about a year afterwards so I'm not expecting a big difference.

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It will...  When you reach  7.5 years the derogatory information will not affect your score, however until you reach your ten year mark the accounts will still affect your age of credit.

[unlucky_hove]

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It will...  When you reach  7.5 years the derogatory information will not affect your score, however until you reach your ten year mark the accounts will still affect your age of credit.

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Are you sure, i thought the entire tradeline would be removed after the 7.5 passed. Or do major derogs (CO, 120+) behave differently than 30 days?

[haulingthescoreup]

It's supposed to be that the tradeline remains after the derog falls off. That's what mine have done (thank goodness.)

Sometimes the whole thing goes poof, though, especially if you've tried disputing, etc. Once it's gone, good luck trying to get it back on for the remaining few years of clean reporting.

[unlucky_hove]

After thinking about it i guess a CO would not count since the entire account is bad and will be dropped after 7 years. So lets say you have 3 months straight of 30 day lates, after 7 years, will all three be removed at the same time or will one be removed at a time at the seven year anniversary date for each?

Sorry to hijack the thread and i know this is the wrong forum for this type of question......last one i promise!

[haulingthescoreup]

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@unlucky_hove wrote:

After thinking about it i guess a CO would not count since the entire account is bad and will be dropped after 7 years. So lets say you have 3 months straight of 30 day lates, after 7 years, will all three be removed at the same time or will one be removed at a time at the seven year anniversary date for each?

Sorry to hijack the thread and i know this is the wrong forum for this type of question......last one i promise!

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In my experience, lol, they came off as each one hit 7 years. One after another, after another...