I've been reading these forums for about a month now, and as with everyone else, the information has been extremely helpful! There is one piece of crucial advice that I think is missing from
Credit Scoring 101, and that is simply "Make A Plan".
When I first started researching into the credit scoring world I had a goal in mind, but that was about it. I was pretty sure it could be accomplished, but I had no idea how or if I could do it "in time". I'm still not sure that it can be done in time, but I think after developing my plan with the information from these forums I've got the best chance.
From reading other posts, it seems that a lot of people start researching credit scores with the outset that their goal can't be reached. And of course it also seems that the success stories come from people with a plan they've developed from the information here.
Quite a few (including myself) seem to just "jump in" and end up making a mistake or two, before reading enough and working out their plan. A plan will also set a time line that will help with what step 2 undoubtedly is, and that is to have patience! It's obviously an important step (just do a
search for "plan" on this forum), and one I think doesn't get stressed enough.
I'm wanting to detail my plan for a few reasons. Those are to 'solidify' it by writing it out, get feedback on it, bring a spotlight to the idea of a plan being an explicitly stated first step, and give an example.
My credit scores aren't as low as I'd first feared, but there also not where I want them to be. My FAKO's (from my now canceled PrivacyAssist) had given me a "620" mindset, but that didn't turn out to be the case. I'll be dealing with fixing someone else's ailing credit scores though, and the successful plans detailed in the
Success Stories and Encouragement have already helped me greatly to prepare for that bridge.
Where I started120k private student loans
12k federal student loans
2k CL CC, 10 month history, 75% avg util, always PIF'd
2 incorrect derogs on TU, 1 incorrect derog on EX, clean EQ
6 years credit history
No late/missed payments (go-go responsibility!)
and I'm guessing scores lower than 650.
The goalConsolidation of my private student loans at a better interest rate based on the LIBOR instead of the PRIME rate (~3.5% difference on variable, ~1.5% on fixed as of now). Hopefully I can pick a fixed interest rate, but thats where time becomes a factor. I want a 760+ before I apply for the loan to get the best rates, and I'm not sure I can get there before the rates start going back up.
The mistakesApplying for the loan without knowing my score and having 75% util on my only 2k CL CC. I was denied, and I'm still waiting for the denial letter (2nd attempt at getting the letter!) The hard inq was the only one I've had in 12 months though, so I don't think it'll affect my score much for the reapplication.
The planSign up for SW so I can monitor my EQ score (the one the loan company pulls, by chance)
Get the derogs removed (even though they won't prevent me from reaching my goal)
Look into another CC to increase my overall CL.
Pay cards before they cycle to get the util to < 10%.
Play the waiting game if score doesn't make it to 760.
At 760, reapply, and possibly get *very* angry if I get denied.
Where I am nowI got a little excited on the CC, and ended up with a 5K CL BoA AmEx. A definite plus, but the hard inq without the approval could've been harmful. I wish I had signed up for SW before I had done this, to compare the score difference.
Contacted the CA about the derogs, and they are supposed to be transferring the debt to the right person and removing them from my CR. I've signed up for True Credit for now to monitor that, as AmEx wouldn't let me sign up for CreditSecure with the BoA AmEx (a small discrepancy with
CS101...turns out not "any AmEx will do" ).
Signed up for SW (finally!). I was *really* surprised to see that my EQ score is 710. I'm assuming that must be the new AmEx CL doing that, as I don't see why I would've been denied for the loan with that score. I wouldn't have gotten the best rates, but from what I've gathered a 710 is good enough for almost every lender.
I'm now waiting for next month so I can start paying my cards down before they cycle. This has to be the most important step I've found for people with no baddies to push the score up (and usually way up!)
I'm a little worried as to what's going to happen to my EQ score. In November, the CC company "misplaced" my CC account information, and quickly issued me a new account and card (history transferred). However, EQ is still reporting the closed account as open. I'm not sure what will happen, as that month my CC had 50% util...but at the same time its bumping up my rotating credit average history. I guess I'll just see how it goes, and hopefully be looking at an EQ 760 and a lower interest rate before the rates start to climb back up.
Of course, any comments or suggestions would be greatly appreciated. What I'm really hoping to see is more plans on these forums, as they are extremely useful for coming up with plans with similar scenarios. Its more than just making a plan, you've really got to learn the plan.
-- Finally,
after 3 write ups, I managed to submit this post...I liked the last version better tho!
