How bad did I mess up?

[Anonymous]

Hi all, I'm a new user here and need your opinions...before I do more damage!

Long story but I think you need the background. about 7 years ago, I went through a break up and essentialy lost my job at the same time. Leaving me with a $1600.00 house payment and an 850 truck payment to figure out.  I went for earning approx 10,000 a month to zip. Some credit card debt I had used on the business that ending up being sold in the break up but not to much maybe 4,000. I live In a semi rural area not to many jobs were available at the time and none paying wages that I needed to survive single now with 3 kiddos.  I lived of savings for about 3 months while job hunting then resigned to taking any job I could get. $9.85 an hour but it was a check.  I still owed 16,000 on my 48,000 loan for my truck and ended up being involved with the BofA lawsuit over my home loan. I called my truck lender (Wachovia) told them the situation. They advised my best bet was to volentarily bring the truck in as I was 2 payments behind and that way I wouldn't have any repo fees and might get a check back for any equity after they sold it. So that's what I did. Never heard anything from them again..no check no nothing. Ended up doing a remod on the house payment cut in half! Forced on BofA by the Feds. But showed 9 missed payments by the time everything was done. I know horrible.

i totally gave up on ever having credit again. My scores went from approx 740 to low 500's  yep I learned the biggest lesson in my life!

fast forward..dec 2014 I'm still at the same job now making just under 50k a year, kiddos grew up moved out and in college. I get a pre approval from premier usually I throw them away because I thought no way anyone would approve me. For only a $179.00 set up fee they would give me a 750 credit line...wow how horrible was that. Remember I had never been to this site nor had I even looked at my credit in 7 years...but I was going on a vacation and thought it might be good to have just a just in case card. I decided I made the poor decisions and this is what it was going to cost me to have a credit card again, yep I did it.  1st payment paid the fees off...so Jan. I a pre approval from capital one QS. $500.00 i was ecstatic! Mind you didn't know my credit scores didn't have a clue about this board. Now comes July I got brave and decided to apply for no interest financing on a sleep number bed. They turned me down but it shows my experian score was 701 omg! 701 that had to be a mistake! Not the denial but the score! 

So so off to credit karma I go found it looking for free scores.  It says my scores are 687 tu and 709 ex. I look deeper and everything was gone except a Home Depot baddie going to fall off In April 2016. I didn't know things fell off...and low and behold.a judgment for that stupid truck for 16,000 I had no clue about. I found Wachovia was sold to wellsfargo the same month I gave the truck back, and no one could tell me what To do because the judgement was given to Wachovia. 

credit karma says good chances for an Amex Ed approval so I do it , bam 10k !   I honestly thought it was a mistake. I thought for sure they would send a letter saying there comps were broken or something. I had just been denied by sleep number for an $1800.00 bed! So then the addition hit...as you see below I was an idiot I applied all over the place...they kept saying yes..then I found my fico. Learned a ton and stopped applying.  Ok well almost stopped applied for a sapphire and was declined reason, to many new accounts...go figure...now I have truely started to garden EXCEPT I have the opportunity to buy a truck from a family friend $10,000 under kbb. Private party sale. Total price with ford bumper to bumper warranty $20,050. It's a 2008 F350 Superduty crew cab 6.4l diesel in excellent condition with only 39000 miles. I have $10,000 in savings to put down so I need financing on 10k. But I screwed up with all of these cards right? (See below) do you think I can get get a loan? 

These new cards are at 20 percent utilization I make large payments 200 to 500 on them each month paying every 2 weeks. But my credit length went from 10.5 years to 1.2 years. My fico scores are below all saying my length of history is poor. Too many new accounts and of course that legal item from wachovia that is 5.5 years old and never collected. I need this loan in the next month or so...I will for sure be closing my premier card in November since they will start charging a monthly fee....they are insane. But should I close more?  My inquires are 10eq, 9tu and and 4 experian. Amex still not reporting my 10k cl but it does show the hp. Maybe for the best it is at 23 percent utilization.  

Maybe I should just forget the truck and stay in the garden? But I do really need a new vehicle mine is on its last legs. Thanks for reading my insanely long post but I thought you should know the history for an honest opinion. Thank you in advance for any opinions / advice / criticisms!

[Anonymous]

If you need the truck, go ahead and go for it. Since it's a secured loan, the underwriting criteria is easier than the credit cards you've been approved for. Plus with that large a downpayment, you should be able to get a favorable interest rate.

[Anonymous]

I was thinking of trying statefarm auto loans because I've been insure through them for years. It says on there web site they do private loans. I can't find much info about the though as in if they are strict or if that's for people with excellent credit... Any ideas on where I would start? 

I didnt know auto loans were easier then credit cards....I have much more to learn ...

thank you for reading and responding to my post..I feel better about it already

[Callandra]

Looks like you're doing a great job of rebuilding!  Judging by your scores, you should be able to get a decent auto loan although probably not the lowest rates that some places advertise. Have you looked at DCU for an auto loan? Most people here will advise you NOT to get financing through the dealership and to go in with financing already. 

The only thing that would concern me is that judgement; I would check the laws in your state about it (I'm guessing it's unpaid as you didn't know about it?) -- some judgements can be renewed and the creditor can choose to garnish your wages/bank account so you might want to address it. I suggest visiting the Rebuilding Forum if you want to deal with the judgement. 

Good luck! 

[Anonymous]

Thank you for the reply Callandra! 

I did did find out through an attorney while trying to get rid if it since I was never served etc.. That in Az they have to re-file it every 5 years which was on April 4th. They didn't so now they can't collect it but it's still sitting there.. I will not pay it since they have the truck which should have had a lot of equity. It's my fault I was so stupid..

That's a big part that worries me along with all these new cards..I had no idea I'd need a loan at the time I went on my crazy spree. I was saving to pay cash for a vehicle. I will have to find someone who does private loans as it is not at a dealership. I'm going to try your suggestions

thank you so much!

[CJ7]

Don't buy Credit Karma's version of AAOA.  They only include open accounts.  FICO averages all your accounts both open and closed.

Challenge that Wachovia judgement.

[Anonymous]

I love your story and it is gratifying to see you come full circle. Sometimes we think that we are at an end and on our last leg, but we aren't. I'm sure that truck sounds just what you need, but I'm sure that what you have can last a few more months or a year. It is easy for anyone here to say apply for another card or of course go for that new vehicle. Yet prudence and reflection says that you have made a lot of progress that you NEVER thought possible. You didn't even think those baddies would fall off, but they did. And in like manner you think your current vehicle can't make it anothr mile. It CAN. 

You can wait and eke out more from that vehicle you have. That's my advice. Is it what you want to hear? No. Is it the typical, easy response you'd expect to hear? No. Is it the response that affirms what you want to hear, not what you need to hear? No. You know full well that the vehicle you have can last longer, and you can get more out of it as you rebuild your fortunes. Take away from the second chance you've been given to not do things the same way you did them in the past. 

Be different. Be courageous to say no to yourself. You know that the reason you asked about getting the truck is that you could wait, but you want others to encourage you to make a choice that is not the best or optimal choice, but the easy choice. I say wait. When your current vehicle is truly on its last legs you will know it when it stops working completely. Until then, use what you've got to get what you want and to go where you want to go!

[Anonymous]

OP: "These new cards are at 20 percent utilization I make large payments 200 to 500 on them each month paying every 2 weeks. But my credit length went from 10.5 years to 1.2 years"

Don't take any new credit until your cards are paid off.

You don't ever want to be paying credit card interest. If it happens either your life has taken a turn for the worse, as in your original story, or else you are using credit to live beyond your means. Either way, running a balance on a card is a big red flag that says something bad happened.

Once your cards are down to zero and being paid in full regularly do an honest assessment of you spending, what do you have left over every month REALLY, and can you afford the truck?

Also see if you can get that judgement taken care of, your score will skyrocket when that comes off. As for account age time will take care of that.

[Anonymous]

BTW, I have only 13 months of history and a score of 733, maybe we can't be 800 club with short histories but it is that judgement, not your length of history, that is killing you. New account penalty and inquiries age off in a year and if they judgement is gone you could be in the top tier for car loans then.

[Anonymous]

How many inquiries do you have?  You sig shows 14 accounts.  You mentioned a few declines.  ~20 recent inquiries??

As mentioned eariler, auto loans are easier to qualify for than credit cards.  At $10,000 less than KBB private party value, you should easily qualify with very little/zero down.

But!... If you qualify with little/zero down, do not take on that new loan until your credit cards are paid in full.  Use any remaining cash for down payment.  The only thing i'm worried about is you're at 20+% utilization of $40,000+ in credit card debt.  That's a lot of debt!  Add on a new car loan on top of that, any unforseen circumstance in the future might put you back in the same predicament as before.

Once you pay the credit cards down, sock drawer them until you are capable of treating them like cash.