How can I improve my score?

[hubbryan]

Hey there, I am in a bit of a situation. When I first entered college, I didn't have the credit history or a co-signer to get a private student loan, and not knowing anything about credit, but having a good job at the time, I got two personal loans within a year and a half, and a credit card to pay for tuition and living costs. I lost my job my last semester of college, and didn't have a job until 6 months later. Those three accounts went into charge off status. I am only 22 years old, and now that I am out of college and have a good full-time job, I want to fix my credit. I have a lot of credit cards (8), and am an authorized user on 2 accounts that my s/o added me on and a family friend to help my credit utilization. My family friend got me the card through Chase bank to pay off the charged off accounts (it has a credit limit of $10,800) and the one my s/o and I use for bills has a limit of $3,000, but is paid in full every month. 

Here is an overview: 

Transunion: 557

Equifax: 551

Experian: 559

Debt (a lot): 

Navy Federal Secured Loan: $49 (one more payment left from 6 month term) 

Navy Federal Secured Card: $134 ($200 limit)

BOA Cash Rewards: $241 ($1,200 limit) 

Discover: $0 ($500 limit) 

Cap One Secured: $181 ($200 limit) 

Cap One Quicksilver: $288 ($300 limit) 

Mission Lane: $618 ($750 limit)

Target Card: $145 ($300 limit) 

Amazon Secured: $75 ($100 limit) 

Chase Freedom Flex: $0 ($10,800 limit) 

Bilt Card: $0 ($3,000 limit) 

Recenly I have been very good about paying the full balance on my BOA, Discover, and Cap One cards on the due date. My goal is to just use the Chase card and Bilt card, but isn't it a bad idea to close cards? 

Charged off accounts: 

Founders Federal Credit Union Loan: $12,140.47 (they are still charging daily interest) 

Founders Federal Credit Union CC: $5,504

State Employees Credit Union Line of Credit: $2,599

I am going to pay off the State Employees account next week. But other than that, how can I help my credit score moving forward? 

[Anonymalous]

---

@hubbryan wrote:

Navy Federal Secured Card: $134 ($200 limit) 67.0%

BOA Cash Rewards: $241 ($1,200 limit)  20.1%

Discover: $0 ($500 limit)  0%

Cap One Secured: $181 ($200 limit)  90.5%

Cap One Quicksilver: $288 ($300 limit) 96.0%

Mission Lane: $618 ($750 limit) 82.4%

Target Card: $145 ($300 limit) 48.3%

Amazon Secured: $75 ($100 limit) 75%

Chase Freedom Flex: $0 ($10,800 limit) 0%

Bilt Card: $0 ($3,000 limit)  0%

Recenly I have been very good about paying the full balance on my BOA, Discover, and Cap One cards on the due date. My goal is to just use the Chase card and Bilt card, but isn't it a bad idea to close cards? 

---

Somebody with more expertise on the subject will hopefully be along to help with the charge offs, but regarding your revolving accounts:

I added percentages, above. Never let a card hit 90%, that's real red flag territory. Your first priority should be paying the two Cap1 cards down to 88.9%. The next threshold is 68.9%, and you have 2 more cards above that. Reducing those to under 50% (48.9%) should help. After that, aim to get all your cards below 30% (28.9%, due to rounding). Under 10% is best, but that's a ways away.

Cards closed in good standing will stay on your profile for 10 years. In the FICO models, they'll continue to be counted in your score for that entire period, so particularly at this stage in your credit journey, it should be fine. The only 2 caveats are utilization (it sounds like you're factoring that in), and Vantage Scores. In VS, closed cards aren't counted. This isn't a huge issue at the moment, because FICO is used my nearly all lenders. But VS 4.0 was approved by Fannie Mae last year for mortgages, so while it will take a few years to implement, it's going to become important in the future.

However, there's an advantage to keeping at least 3 personal (not AU) cards, because it allows you to practice AZEO, which is a way to optimize utilization. (With 3 cards, pay 2 down to $0, and leave a small balance on the last one).

But why are you concerned about your credit scores? Deal with the debt, then worry about your scores. As long as you have recent collections, your scores are going to be terrible, and going after more credit before you get your house in order is a bad idea, especially if you're not sure you can be responsible with the credit you do have. Fortunately, you don't really have that much debt, and you're young, so you have a lot of time to build a good credit profile

[CLabuser]

your best bet is getting a bunch of AU's from family or local friends, it may seem like a touchy subject with people but it virtually costs NOTHING and it's a 10 sec process. Anyone clost to you who wouldn't WANT to do it, either doesn't wanna help you or is lazy. THIS is what will help you get your foot in the door because you PERSONAL credit report will not quality for anything substantial. You have to rely on the credit worthiness of others before you can stand on your own. 

"hey can you put me on a few of your credit cards?"

"i'm trying to fix my credit but i need clean accounts under my report, and since you don't have debt, it would tremendously help me out"

^ this is how you'd want to phrase it when asking.  luckily you've had someone come through and put you on. 

another issue is that you have too many accounts with baby limits so it's categorized as high risk because NO lender has given you anything substantial that would act as a vouch to other lendors/credit processors. 

i see you have 1  - 4 digit limit & a starter 5 digit limit card which is good cause you caught a break there but the ratio of accounts is going to be looked at like this through the processors sytem.

how many accounts ? 11 Accounts

how many major limits (4-5 digit limit cards/accounts)? 2 Cards

how many baby limit cards (3 digit cards/accounts) 9 Cards

This ratio is not good enough and we live in a world that your credit report is your facecard.  I've learned some game over the years in regards to credit and manipulating systems to get substantial credit lines but it takes time. 

My homework for you would be this:

• Call each account lender and ask if credit limit increases are hard or soft inquiries.
• go down the list and weed out whatever is or isn't and hard pull.
• submit increases for NO MORE THAN 1,000$ for each account, i can't stress this enough. This is to create multiple vouches for your credit report when you recieve a bunch of credit limit increases, because it makes you more credible and worthy.
• maintain all the accounts you have and pay them down slowly by slowly, this combined with the slight credit increases will build up your total CL, lower utilaztion, and stregthen your accounts.

report back when this is done, i'm waiting for your reply and good news. 

[FireMedic1]

Take the cards and give them to a family member. "Recenly I have been very good about paying the full balance on my BOA, Discover, and Cap One cards on the due date. "My goal is to just use the Chase card and Bilt card, but isn't it a bad idea to close cards?" No need to close them. Stop using them. Interest alone on all those cards isnt helping paying them off. Live off your debit card and get out of debt. Adding AU's is just a bandaid on a laceration. Stop the bleeding. The good by adding AU'S isnt going to fix whats owed. Look up the snowball method. Finances over FICO. Get rid of the swipe fever.

[SouthJamaica]

---

@hubbryan wrote:

Hey there, I am in a bit of a situation. When I first entered college, I didn't have the credit history or a co-signer to get a private student loan, and not knowing anything about credit, but having a good job at the time, I got two personal loans within a year and a half, and a credit card to pay for tuition and living costs. I lost my job my last semester of college, and didn't have a job until 6 months later. Those three accounts went into charge off status. I am only 22 years old, and now that I am out of college and have a good full-time job, I want to fix my credit. I have a lot of credit cards (8), and am an authorized user on 2 accounts that my s/o added me on and a family friend to help my credit utilization. My family friend got me the card through Chase bank to pay off the charged off accounts (it has a credit limit of $10,800) and the one my s/o and I use for bills has a limit of $3,000, but is paid in full every month. 

Here is an overview: 

Transunion: 557

Equifax: 551

Experian: 559

Debt (a lot): 

Navy Federal Secured Loan: $49 (one more payment left from 6 month term) 

Navy Federal Secured Card: $134 ($200 limit)

BOA Cash Rewards: $241 ($1,200 limit) 

Discover: $0 ($500 limit) 

Cap One Secured: $181 ($200 limit) 

Cap One Quicksilver: $288 ($300 limit) 

Mission Lane: $618 ($750 limit)

Target Card: $145 ($300 limit) 

Amazon Secured: $75 ($100 limit) 

Chase Freedom Flex: $0 ($10,800 limit) 

Bilt Card: $0 ($3,000 limit) 

Recenly I have been very good about paying the full balance on my BOA, Discover, and Cap One cards on the due date. My goal is to just use the Chase card and Bilt card, but isn't it a bad idea to close cards? 

Charged off accounts: 

Founders Federal Credit Union Loan: $12,140.47 (they are still charging daily interest) 

Founders Federal Credit Union CC: $5,504

State Employees Credit Union Line of Credit: $2,599

I am going to pay off the State Employees account next week. But other than that, how can I help my credit score moving forward? 

---

1.  You're going to be able to achieve small gains, but the chargeoffs will always weigh you down. So if you want to really clean things up you'll need to resolve those with the creditors.

2.  You keep referring to paying revolving accounts off before the due date, or paying in full. But it makes a difference how you do it.  Assuming your statement balance is your reported balance, if you pay them off after the statement cuts, but before the upcoming due date, the statement balance is nevertheless factored into your utilization. Whereas if you pay them off before the statement cuts, only a zero balance is factored into utilization. First, you should pay off anything with a small balance.  Then, going forward, you should have all but one of your revolvers report a small balance, while the others report zero balances.

3. If you have any cards with an annual fee, close them. Otherwise, there's nothing to be gained by closing any of the other cards. Just don't use them.

4. I don't know what you meant by this:  "My family friend got me the card through Chase bank to pay off the charged off accounts (it has a credit limit of $10,800)".  So I can't comment on it.

[Latoria]

Improvement of your credit score is always a great decision! It will help you in different areas of your life, including finding a job, renting an apartment, and others. There are various ways to improve your credit, so I will present you the best ones: 

1. Review your credit report regularly;

2. Pay your bills on-time;

3. Repay your outstanding debts;

4. Limit the number of hard credit inquries in your bank account;

5. Ask for higher credit limits;

6. Use a secured credit card;

7. Apply for credit-builder loans. 

[Slabenstein]

---

@Latoria wrote:

Improvement of your credit score is always a great decision! It will help you in different areas of your life, including finding a job, renting an apartment, and others. There are various ways to improve your credit, so I will present you the best ones: 

1. Review your credit report regularly;

2. Pay your bills on-time;

3. Repay your outstanding debts;

4. Limit the number of hard credit inquries in your bank account;

5. Ask for higher credit limits;

6. Use a secured credit card;

7. Apply for credit-builder loans. 

---

You're still failing the Turing test.  Just fyi.

[CYBERSAM]

---

@hubbryan wrote:

Hey there, I am in a bit of a situation. When I first entered college, I didn't have the credit history or a co-signer to get a private student loan, and not knowing anything about credit, but having a good job at the time, I got two personal loans within a year and a half, and a credit card to pay for tuition and living costs. I lost my job my last semester of college, and didn't have a job until 6 months later. Those three accounts went into charge off status. I am only 22 years old, and now that I am out of college and have a good full-time job, I want to fix my credit. I have a lot of credit cards (8), and am an authorized user on 2 accounts that my s/o added me on and a family friend to help my credit utilization. My family friend got me the card through Chase bank to pay off the charged off accounts (it has a credit limit of $10,800) and the one my s/o and I use for bills has a limit of $3,000, but is paid in full every month. 

Here is an overview: 

Transunion: 557

Equifax: 551

Experian: 559

Debt (a lot): 

Navy Federal Secured Loan: $49 (one more payment left from 6 month term) Pay/Close no need.

Navy Federal Secured Card: $134 ($200 limit) Pay/Close no need.

BOA Cash Rewards: $241 ($1,200 limit) Make primary account and PIF

Discover: $0 ($500 limit) Use and PIF

Cap One Secured: $181 ($200 limit) Pay/Close no need.

Cap One Quicksilver: $288 ($300 limit) PIF but don't close for now, but mostlikey bucketed.

Mission Lane: $618 ($750 limit) Pay/Close no need.

Target Card: $145 ($300 limit) useless CL

Amazon Secured: $75 ($100 limit) Pay/Close no need.

Chase Freedom Flex: $0 ($10,800 limit) AU would not help you to spend on this

Bilt Card: $0 ($3,000 limit) AU would not help you to spend on this

Recenly I have been very good about paying the full balance on my BOA, Discover, and Cap One cards on the due date. My goal is to just use the Chase card and Bilt card, but isn't it a bad idea to close cards? 

Charged off accounts: 

Founders Federal Credit Union Loan: $12,140.47 (they are still charging daily interest) 

Founders Federal Credit Union CC: $5,504

State Employees Credit Union Line of Credit: $2,599

I am going to pay off the State Employees account next week. But other than that, how can I help my credit score moving forward? 

---

Seems like you started too fast and watched too many youtube credit builder clips unfortunately!

I can see how this looks horrible and overwhelming, but in reality is not. Now that you have a good job it makes it even easier to fix your predicament.

1. As I noted you no longer need any of these secure accounts. The purpose of secure account is to generate a FICO score so you can get a normal account, all you needed was one! They no longer provide any use or benefit to you. Cancel and get your deposit back.
2. AU accounts are not going to help your score at this stage of your profile as you see. Don't cancel them yet but they have no use to you and stop spending money on them given they would not help your credit.
3. Make sure pay your own credit cards in full to improve your chances of growing that card.
4. DO NOT APP for any new loan or CCs. Also don't try CLIs yet. You don't want to a manual review that could result in AA. Your score is very low for any banks to provide you with more credit.
5. All you need is 3 good CCs reporting monthly to improve your score, by canceling all the cards that would not grow you can focus on improving your credit and getting control of everything. Keep it simple.
6. Lastly overall utilization is no longer an issue for you. Your score is already affected and you do not want to carry any balance at all. You may even want to pay your balance before it reports to keep the individual card utilization down.

Now the best charge-offs that you can have, if there is such a thing is through CUs. They can work with you the best and you probably have good chance to have them remove the negative once the balance is satisfied. I have no experience with your CUs but I do know that they are much more lenient then regular banks and collection companies.

You can contact them and setup payment options or a settlement if they are willing to remove the negative altogether, certainly worth a try!

Good luck 👍

[jhunna]

Improving your credit score is possible even after experiencing credit challenges. Here are steps you can take to start moving forward and rebuilding your credit:

1. Settle Charged-Off Accounts: Pay off or negotiate settlements for charged-off accounts.
2. Pay On-Time: Ensure on-time payments for current credit cards and loans.
3. Reduce Credit Card Balances: Lower credit card balances, aiming for under 30% utilization.
4. Keep Cards Open: Avoid closing old credit cards; use them sparingly.
5. Diversify Credit: Consider adding different types of credit accounts.
6. Monitor Reports: Regularly check your credit reports for errors.
7. Be Patient: Improving credit takes time; stay consistent.
8. Avoid Late Payments: Never miss due dates; prioritize on-time payments.
9. Authorized User: If possible, become an authorized user on good-standing accounts.
10. Budget and Save: Create a budget and build an emergency fund.
11. Professional Help: Seek credit counseling if necessary.

Remember that improving your credit score is a gradual process, and it may take some time to see significant improvements. Stay focused on your financial goals, avoid taking on too much new debt, and continue practicing responsible credit management to rebuild your credit over time.