Trying to get above water

[Anonymous]

Okay, to start off I have a TU score of 568 and was running nice at around 670 until a late payment went in on my mortgage.

The issue was I sent my payment in the mail, and go figure, snail mail was extra slow and at around 28 days I went online to pay my mortgage. My mortgage company would only do two months payments at that point since my next month was due as well. No problem, I had the money, submitted the payment and go figure - the check is processed the same day! So my account overdrew and bounced both payments and they kept trying both three times. This pushed to 30 days late and they posted my 30 days late, even though I technically wasn't and I tried calling them to cancel at least one of the payments so they would make it through, but they said they couldn't...WTF. I have read a lot on these forums and wish I had done so before I disputed it as I would have written a goodwill letter instead. Do you think any positive will come out of the dispute?

Anyway, so my credit is low and here is what I have in the way of credit cards:
Bank of America: BAL: 2490 CL: 2500
Capital One: BAL: 798 CL: 1000
Chase: BAL: 1993 CL: 2200
Cit Bank: BAL: 1350 CL: 1500
HSBC Bank: BAL: 733 CL: 750
HSBC Bank: BAL: 477 CL: 500
HSBC - Retail: BAL: 2408 CL: 2505 (Reduced from 3000 for low credit score)
WaMu - BAL: 1890 CL: 2000


Total Credit: 12,955
Total Balance: 12,139
Total Utilization: 94% (ACK!)


Loans:
State Farm: Bal: 6640 Opening: 9000
Mortgage: Bal: 161,730 Opening: 163,989

Anyway, regardless of interest rates I have started doubling my minimum payments which is about all I can afford, but my question is - would it help my score quicker if I go and put the "doubled" money on all of the cards at one card first and just start clearing them out one at a time?

My next question is, would it be better to hit my lower CL cards first? Remember, regardless of interest rates, which would be better for my credit score in the long run, I want these paid off and done and get out of the hole I am in after a rough patch.

Thanks everyone!

[dangphuocloc72]

you max out your CC like that . try to pay them down as soon as you can , another way you paid alot money for them .

[Anonymous]

Hi RSidetrack! Welcome to the forum.

You are seriously in debt, as you know. My best suggestion would be to take EVERY credit card you own, put them in an envelope and keep them in the bottom of your sock drawer.

Do not use them at all. Go cold turkey 100%. Cash only(or checks of course) until you get those balances down to a very reasonable level.....around 20%-30% or less.

Pay as much as you can possibly afford. The allocation of funds across your credit lines imo, should be about the same. Others will disagree. But that's just my opinion.

Good luck to you.

[Anonymous]

Thanks Sylviatob, I actually cut up all but two of my credit cards a little while ago because I was so upset with the situation, didn't close the accounts or anything.

I am actually to be getting a bonus here in March from my company so I am going to use that to pay some down. I am trying to put as much as I can towards them, but unfortunately I can only afford about double the minimums :-/

I will be getting a small tax refund as well coming up whenever the government sends it to me :-). That will also be applied to the cards as well. I guess I will spread it evenly over them, but it'd be nice to have them paid off in full one at a time as well.

I guess the question is would having a card with a $500 CL getting paid off help more score more than paying all of them down a little bit. It would change my utilization the same so I dunno.

[MsKmm00]

I realize your question pertains to your score, however I only have input for your other question: how should you pay down your debt. Every financial planner I have worked with states to pay off your cards in order of the highest APR. Once you have paid off one, use that money PLUS to begin paying off the next and so on.

Message Edited by MsKmm00 on 02-26-2008 01:53 PM

[Anonymous]

Thanks for replying - and this is what I have heard too. And I understand it completely, you are paying mostly interest on those cards because of the high APRs, but then again, a slightly lower APR with a higher balance could cost you more. I think I am going to take the one card at a time approach, but am going to shoot for the most costly one first.


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Does anyone have any idea if my dispute will result in anything with my 30 days late on my mortgage payment? I tried everything to get them to stop throwing all three payments at the same time every 2 days but they said they couldn't do it and that is the only reason I was late. I couldn't get to the bank to stop payment on the check :-/

[Anonymous]

Well, my dispute was turned down as I figured it was on my mortgage account - after all, it was technically late :-). I put together a GW letter, another thread asking for reviews on here. Hopefully they will be nice to remove it.

[fishbjc]

Typically that looks like a lot of debt because of utilization.  It certainly depends on your income. 

Have you thought about securing a p/t position in order to pay off a few of the smaller cards?  

May I inquire your FICO scores? 

[Anonymous]

Unfortunately income is a little tight right now, but any extra money I am getting (tax return, employer bonus, etc)I am going to throw at them.

I only have my TU score which is 588. I want to get back in the 700's as fast as I can but it looks like it could take a long while :-(