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Low FICO Score, what to do?

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Valued Contributor

Re: Low FICO Score, what to do?

OP...one other thing I meant to point out. Two of your open accounts are secured, I suppose it is with savings. The idea of how a secured credit card helps your score is as follows. You get a 1000 dollar credit card secured by 1000 dollars in savings. You then use the card and pay it off before the due date every month. The cards credit limit and low balance helps your utilization and shows that you can handle credit well. If however, your utilization is at or near 100% on the secure cards, they are hurting your utilization and showing as 2 more maxed out accounts. You would be better off surrendering enough of the securing funds to pay the rest of it off, which of course will lower the limits. Don't close them, just surrender enough to where you can keep the reported utilization at or near 0. In your case, the secured cards are hurting your score, when they should be helping it....edit:: I just saw that I read one of them wrong, only one card is nearly maxed out, but that card is more a drag on your score than a help.

TU fico08=823 09/28/19
EX fico08=813 10/16/19
EQ fico08=823 10/04/19
EX fico09=810 10/02/19
EQ fico bankcard08=844 09/24/19
Message 11 of 21
Established Member

Re: Low FICO Score, what to do?

The debts are still in the SOL.  The Chapter 7 was discharged, but the Chapter 13 was dismissed.  I can pay those balances down within 3 months, just had some unexpected charges.  I know the 100% is hurting and needs to be fixed.  Will that help my score the quickest, or paying collections?  As for Capital One, that is what it is doing.  Transunion shows open, but Experian shows closed.  However, it shows payment history, with the balance never going down.  What should I do about that?  I have just paid $300 last week and will pay another $300 on Friday to PIF this account.

 

See links of pictures from Capital One

https://ibb.co/ZcjvXRn (Transunion)

https://ibb.co/WHNdrmR (Experion)

Message 12 of 21
Valued Contributor

Re: Low FICO Score, what to do?


@jeboles wrote:

The debts are still in the SOL.  The Chapter 7 was discharged, but the Chapter 13 was dismissed.  I can pay those balances down within 3 months, just had some unexpected charges.  I know the 100% is hurting and needs to be fixed.  Will that help my score the quickest, or paying collections?  As for Capital One, that is what it is doing.  Transunion shows open, but Experian shows closed.  However, it shows payment history, with the balance never going down.  What should I do about that?  I have just paid $300 last week and will pay another $300 on Friday to PIF this account.

 

See links of pictures from Capital One

https://ibb.co/ZcjvXRn (Transunion)

https://ibb.co/WHNdrmR (Experion)


I will try to answer the question about what will give you the quickest increase to your credit score, but it is not the same thing as what would be the best think to work on. Utilization is absolutely the one that will gain you the most points the quickest. It is also the least important thing to concentrate on. You see, most factors that make up a score has long lasting effects, a missed payment will be on the report for 7 years. A collection will as well. Utilization does not have that same effect. If having high utilization is dragging your score down by 100 points, and you pay every single card off except for a small balance on one card, you will recoup every single one of those 100 points, even if it is the first time in 20 years that your utilization was low. If you let the utilization return to the very high levels the next month you will lose the 100 points again. Utilization is very important if you are fixing to apply for something major like a mortgage, but due to the lack of previous history effecting it, the effects, both good and bad can be looked at as temporary. Credit Utilization makes up I think, 30% of your score, and it will always be the way to get higher scores immediately...well, as soon as the new balances report...but because of this, for long term credit score success, it is the least important factor, because you can take an action to regain every lost point due to utilization at any time. The other factors that drag a score down can not be fixed by just paying them down or off. Collections, Delinquincies, repossessions, judgements, etc. will be a drag on your score for 7 years even if they are payed in full unless the creditor accepts a PFD or removes it for some reason.

TU fico08=823 09/28/19
EX fico08=813 10/16/19
EQ fico08=823 10/04/19
EX fico09=810 10/02/19
EQ fico bankcard08=844 09/24/19
Message 13 of 21
Established Member

Re: Low FICO Score, what to do?

My reason for wanting to increase my score rapidly is to qualify for a mortgage.  Will paying off collections result also in a score increase or will it take time for them to drop to increase the score.

Message 14 of 21
Valued Contributor

Re: Low FICO Score, what to do?

They’ll gain you a few points as you go, but not much until the last derog goes away - that’s when you get the big jump. However, if you want a mortgage, you’ll be required to pay off any debts you have hanging out there, so by the time you’ve done that, your scores should have rebounded as a result.


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Message 15 of 21
Established Member

Re: Low FICO Score, what to do?

Well, good news is I don't have much left to pay, maybe around $1,600 from all my collections / charges off.  I'll work on them and report back in a couple of months.  

Message 16 of 21
Moderator

Re: Low FICO Score, what to do?

Any collections not reporting monthly leave alone until after your mortgage pulls unless you can get a PFD.

"If there's a lack of money in your life, understand that feeling worried, envious, jealous, disappointed, discouraged, doubtful or fearful about money can never bring more money to you, because those feelings come from a lack of gratitude for the money you have."

"Reactions are powerful creators because they contain every element needed to manifest—they're a combination of thought, belief, and feeling in action. Positive reactions create more positive things, and negative reactions create more negative things. If you can respond to negative situations calmly and lightly, instead of with emotional turbulence, what happens next in your life will be so much better."

- Rhonda Byrne

Message 17 of 21
Established Member

Re: Low FICO Score, what to do?

Well, that leaves Verizon and Capital One.  Already half way paid off Capital One.  Will try to do PFD with Verizon tomorrow.

Message 18 of 21
Moderator

Re: Low FICO Score, what to do?


@jeboles wrote:

Well, that leaves Verizon and Capital One.  Already half way paid off Capital One.  Will try to do PFD with Verizon tomorrow.


These 2 are OCs not collection agencies. Can try with verizon as Cap-1 does update monthly and will not do PFD. Reason I said to leave collections not updating alone is if they update they will drop Fico, also some may not need to be paid off before closing your lender will tell you what needs to be taken care of prior to closing.

"If there's a lack of money in your life, understand that feeling worried, envious, jealous, disappointed, discouraged, doubtful or fearful about money can never bring more money to you, because those feelings come from a lack of gratitude for the money you have."

"Reactions are powerful creators because they contain every element needed to manifest—they're a combination of thought, belief, and feeling in action. Positive reactions create more positive things, and negative reactions create more negative things. If you can respond to negative situations calmly and lightly, instead of with emotional turbulence, what happens next in your life will be so much better."

- Rhonda Byrne

Message 19 of 21
Established Member

Re: Low FICO Score, what to do?

Well Verizon will not do PFD. I think I will put off a mortgage for a few years and let everything drop off including the previous bankruptcy . I’ve set up payment with Verizon to pay it off within 6 months.
Message 20 of 21
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