@Anonymous wrote:
Well I was doing pretty good and then BAM, lost my government job due to layoffs...OUCH...Unemployment wasn't nearly enough...
As I stand now in the low 500's, with a new job, I'd like to buy a house within the next year. With that being said, I have two old collection accounts that are maybe 5 years old. I also have two newer accounts that are in collections that I've tried the PFD tactics and GW letters but nothing seems to be working for those. Then there is my open lines of credit and installments. I have a car loan that is less than 2 years old. With 2 60 day lates and 4 30 day lates. I also have about 4 credit cards that are 30-60 days late. I am trying to catch up. But my question is if I pay these down to zero and keep my auto loan on time for a year, could we estimate a big jump in the score?
Thanks guys.
Not likely. You might see small gradual increases as the TLs age and as the damage from the baddies fade, but you won't see any dramatic increases until the lates disappear. Per FICO scoring, a new 30 day late, with a relatively clean report, can drop you 50+. The damage will gradually fade with time and will be largely unfelt by the 2 year mark. A 60 day can certainly impact you for the full 7 years that it reports but the damage will be largely unfelt by the 7 yr mark. A 90 or worse, including a CO or CA reporting, will largely hurt through the end of 7 years. If these accounts are open, then try sending a GW letter for each. Paying your CCs will help due to changes in util and FICO likes to see $0 balances.
