I am new to the forums and have been reading as much as possible, but am more confused now than I was before! I am sitting here in tears because I just don't know which way to turn, it is overwhelming. The sad thing is all my issues are minor but I am so desperate to make the right decisions in cleaning up my credit in order to purchase a home. To get straight to the point here is what I am working with:
My scores - EQ - 515; EX - 508; TU - 558
Hubby - EQ - 575; EX - 519; TU - 531
1. Credit Card - limit $300 - high balance - $429 - Pay status - Current - No late pays - Closed by me 5/31/08
2. Collection Agency for Verizon Acct listed as Derog/Collection/charge off - amount $354 - I just called Collection Agency and paid the settlement of 50%, they said they couldn't take it off credit because of their policies but that they would mark it as settled in Full w/ a zero balance - was this a mistake? (this is what I'm crying about, I don't know if I made a mistake
3. 2 current car loans - one started June 2008 and one started November 2007 - both paid on time as agreed
4. 2 previous car loans - both listing late pays in 2007 but both were also paid off in 2007
5. Collection Agency for cable company - amount $150 - do I pay settlement or full amount? it is for 2006 but was reported again in April 2009
6. Collection Agency for Medical Lab - amount $81 - for 2006 but reported again in 2009 - just pay??
7. Collection Agency for Library - amount $125 - Opened in 2004 and last reported in 2004 - should I just leave it alone since it is 5yrs old or should I pay it?
8. Collection Agency for Medical - amount $50 - Opened in 2003 but reported last on July 2008 cause I disputed it - should I just pay?
My verizon account is listed three times, twice under installment accounts as Verizon and then as the Collection Agency, and then it is listed under Collection accounts. Will all these reflect paid since they are all the same account just under different sections of the report?
This is my hubby's:
1. Open paypal account that is currently over the limit - planning on paying off within the next 3 wks, will this help score?
2. Same car loans accounts as listed on mine above.
3. 2 Collection agencies for credit cars - I paid both off in full in June this year, hopefully that will help his score
4. 2 Credit card charge offs - one high limit $434 the other $491 - balance is $0 though but both are listed as charge offs? - one is from 2005 but last reported 2007 and the other is from 2004 last reported in 2006- what do I do with these?
5. Another credit card charge off - amount $1122 - opened in 2004, last reported 2007 - what do I do?
6. Collection Agency for T-Mobile - amount $358 - it is with a law office - it is from 2003 but listing as opened in 2009 and last reported in 2009 - what do I do?
7. Bankruptcy that was discharged 11/2001
Sorry this was so long, I just wanted to make sure I put it all out there. All advice given will be greatly appreciated!
This is kind of an overwhelming list in this format. As you go along, you will get more and better responses if you group like with like, so all your collections together, separate from your medical collections, etc.
The first question is what are you willing to pay? Do you have funds to get started on paying these things off? That's the only way to proceed . . .
So the first thing on your list is killing you even though you have no lates on that credit card. One of the big things that make up your score is your utilization ("util"). Because you owe more than the limit on that card, your util is over 100%. You'll be scored highest when your util (overall, and separately, by card) is less than 9%. So you will get a big bang (scorewise) for your buck if you pay it off. Why did you close it?
For the CAs, you should first DV (to make sure that the CA even still has your account), and then try to negotiate for a PFD. If you don't know the abbreviations yet, check the stickied threads at the top of the forum to find them out. A paid CA is just as bad as an unpaid CA for score. But most loan officers will require that those be paid off prior to closing, so even if you can't get a deletion, you probably still will need to eventually pay those. But worth the shot at deletion.
For the medical CAs, you'll want to do some research on HIPAA. Supposedly, paid medical collections cannot report (just unpaid medical collections can report). But you'll want to follow the HIPAA process to make that happen. You can use the search feature in the upper left and type in HIPAA. It's pain, but some folks have had success with it.
For the lates on the car loans, the best you can do is try for a GW. Unless-they're reporting something incorrectly. If there's something incorrect, that's a different ball of wax entirely. But it sounds like you're not disagreeing with anything on your reports, just wishing the bad stuff wasn't there.
On your husband's list, as I mentioned above, paying off CAs will not help your score unless you negotiate a deletion. Additionally, both the OC and the CA can report on a single account--so you get dinged twice for the same bad account. Just keep that in mind.
For the cards that have not yet gone to CAs, you'll want to try to work something out with the OC so they don't go to collections. Looks the one is paid, what about the other one? Once paid, they can continue to report as COs. That's just an accounting term. But look carefully to make sure they are reporting correctly in terms of your recollection of events--that is, when the lates occurred, etc.
You definitely have a lot of repairing to do before you're ready to begin rebuilding. But there are lots of folks here who can help.
ETA: don't talk on the phone to CAs, do all the negotiations in writing. You can try to negotiate for PFD with OCs, but that's rare, and most won't do it.
As far a your library collection; mine was deleted 1 year after I had paid it.
Hope it info helps.
Just to add.
Always know what the DOFD and SOL for each type of an account.
Never send a DV if it is within SOL unless you can pay the entire account in full.
Never close an account with a balance on it.
Never talk to a CA. Always correspond in writing.
Paid and unpaid collections and Charge Offs are scored the same by FICO. Charge offs with a balance that are paid will help your utilization.
Keep utilization below 10%. For optimum score results keep it below 3%.
Do not give up. It may take a while but your scores will incease.