Long story short, I was in 3 car accidents (not at fault, just terrible luck apparently) within a year and a half. The last one totaled my car. This has left my credit totally trashed because I was unable to work and keep up with payments.
I keep getting tempted to pay someone like a credit repair place to help me because it just seems so overwhelming with a full time job working overnights and 3 kids. I really want to start digging myself out of this hole so I am able to buy a house next January.
I guess my question is - where do I start? I have a few accounts in collections. One is 6 years old so I'm not sure if it's worth bothering with at this point. Is paying collections worth it? How do I go about doing so? Will it make a difference in being able to buy a house?
Also when my vehicle was totaled in 2019, my car loan was through BBVA. My credit report shows this loan as derogatory and the balance not paid off even though USAA paid BBVA and I had gap insurance for the remaining amount. I have called USAA several times to confirm and when I call BBVA they give me the runaround. They keep me on hold for hours and continue to transfer me to different people. Is there any advice on how to handle this especially?
Any advice is welcome! I am completely lost and have no idea what I am doing. I have recently gotten 2 secured credit cards as well in hopes that can help.
The first step is to figure out exactly what you owe, and to who. I would pull your reports from annual credit report and list all of your debts so you have something to work from going forward. I would also obtain your FICO scores so you know where you currently stand.
I would stay away from credit repair services. There's nothing they can do for you that you can't do for yourself. Many times, they will hurt your credit in the short term.
Paying collections are worth it. For one, if they're still within the statute of limitations, you can be sued. For two, paying then will improve your credit score; especially if they are deleted from your credit report. And for three, many traditional mortgage lenders won't underwrite a mortgage if you have unpaid debts such as collections or charge offs.
If you list the companies and/or collection agencies you're dealing with, you'll likely get some more insight.
In order to best help you, please list out all debts, including open and closed loans, credit cards, charge offs, collections, etc. including balances and who the debts are with. Paying a collection is most beneficial when you can get it deleted altogether after payment, which not all CAs do. But several do. As for a mortgage, you may have to pay off all outstanding collections anyway as part of the deal to get approval.
We've all been there.
The first step is seeking advice from those that have achieved or are in the process of achieving the same positive steps you are wishing to accomplish yourself. You've done that by reaching out to the community here so Kudos for taking the first step!
As suggested by the replies before me, if you will give us a lay of the land for what your current credit reporting footprint looks like, the membership here will be glad to chime in and offer suggestions for accomplishing the desired end result.
We look forward to your reply and to the opportunity to be of assistance in your credit repair journey.
I have 3 accounts in collections. They are:
I have 5/6 accounts that say charge offs, but one I know for sure is innaccurate and I am going to be calling later today. These are all more recent and from 2018/2019 when I had all of my accidents and I couldn't keep up with payments.
I also have $10k worth of student loans that have 2 late payments from 2019, but other than that those are current.
I am able to pay off all of my collections and charge offs ASAP (except BBVA, because I am adamant that one is removed since insurance paid), but I guess I need to know the best way to go about it.
Welcome to the forums. Also i know for sure portfolio recovery does PFD and i think LVNV does to so once those are paid they should fall off. As far the one falling off on 10/2021 i wouldn't worry about it until the very end or let it fall off and pay it afterwards. For the indigo card they could have sold it to a collection agency which would add a new one with a potential score drop once that one is added. So for indigo i would figure out if they did or didn't so you don't have a new collection come out of nowhere. Good Luck on your rebuild.
- BBVA - $38,711, but this is the one I am sure is not accurate since insurance paid $30k of it and I filed gap insurance for the remainder.
- First investors - which was a voluntary surrender (I just couldn't make the payments and gave up) and says $0 so I'm not sure how to figure out how to fix that.
If insurance has actually paid 30K they must update the balance to show it, to continue to report the full amount is against the law, if a creditor reports anything it must be accurate information. A CFPB complaint would be in order to induce them if they refuse to do so. Keep all your paperwork on it as evidence the entire time it can be reported.
The insurance has paid that amount. I will have to dig through everything to see if I have any documentation, but I have confirmed with the insurance and I do have the claim #. Every time I call BBVA they place me on hold for over an hour. I will call them on my next day off so I can dedicate the day if need be.
For pay to delete - do I need to send them a letter? Do I pay the full amount or do I try to get it lower?
And how do I handle the charge offs? Do I just call and pay them or do I need send them a letter as well?
For Portfolio and LVNV you don't have to send a letter they delete automatically. As far as the charge offs you just have to pay them rather in a settlement or in full then send out goodwill letters the companies with hope that they will delete the negative information. Original creditors don't usually do pay for deletes. Also i know for portfolio they will delete even if you settle so no need to pay that one in full and for LVNV once if you speak to them you can see if they will delete even if you settle they may but in my opinion if any collection agency will delete even if you settle i would settle. The charge offs if you don't plan on getting another card with them in the future just call and settle with them too but if you want to do businesss with them again call & pay in full.
Good advice given above. I just want to add, if you settle your debt/charge-offs for less than the amount owed, you'll likely receive a 1099-C next year and have to pay taxes on the forgiven amount. If you want to reestablish a relationship with the creditors, it may be best to pay them in full if you're able to do so.