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My Credit Redemption

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My Credit Redemption

Hello all,
 
Ive been a long time lurker of this forum for years and have gained a ton of knowledge about credit and how it works. I still find myself asking questions about it all because I have not yet put it to use with my own situation. So here I am!
 
My goals currently are buying a car, renting an apartment, and then buying a home in the next few years.
 
What led me to such a downfall in my credit is just poor management with a huge lack of knowledge of how credit and money work. I was young and loved spending. Over the years I have acquired several accounts that are in collections. One debt owed to a property management group due to a bad breakup (~$4k) My car is paid off but it is starting to get older and older. After moving to a new state I am finally in a place where I can really focus and knock some debt out if I put the money towards it. I dont make much but I know it can be done and the grip on my life will ease up. Im tired of feeling like im being buried alive as I get older and want to purchase things that I should be able to. Im 26 and I would like to feel confident in making purchases. Ive started budgeting but I feel like i need to make more use of my pay by getting my credit straightened out.
 
Transunion / Equifax : 512 517!

 
Collections:
Credit Collection Services : $101

Credit Collection Services : $260
Convergent : $584
Portfolio Recovery : $863 (5 yrs old)
AT&T : $1,160 Disputed and removed!

Quality Recovery Services : $3,994
 
Not really too sure how to go about getting started on this. I need to be able to rent a home/apartment and buy a new car.
What would be a good plan of action to attack this? One of the main questions is: Should I go for a secured credit card? I have 0 credit cards as it is and Im wondering if opening any up would help. I can afford to put a deposit down for a few and I would like to get started on building some good history while I work on my open accounts.
 
I often come to this forum to think of what to do and now I just want to get some help with my own situation because I know each one is different. I would like to update this thread with updates until I am free. Please help me!
 
 
 
Message 1 of 13
12 REPLIES 12
Regular Contributor

Re: Need Direction to Start

Welcome to the forum!!! I was the same as you, browsing for a while before ever actually posting. As you know, there’s a ton of good info on here so keep browsing.

First get a copy of your credit reports. All 3 of them. Print them out so you can take notes on them. AnnualCreditReport.com or CreditCheckTotal.com (comes with FICO scores). One is $1 trial and the other is free. Don’t use Credit Karma for scoring purposes, it’s not the real deal for what you need/want. Only use it for credit monitoring.

Regarding your collections:

CCS is pretty easy to deal with. They usually don’t completely own the debt (contracted to collect) so you may be able to make your payment directly to the OC. I just got them off my report last week by dealing directly with the OC (Progressive). The rep told me that they would remove it if I paid her in full. I also wrote down her name and the time of the call. Good thing I did because CCS ended up refusing to delete at first. Then I pulled out all the proof so it worked.

PRA is a nightmare. They won’t delete at all. They are strictly “by the book” and they will try to sue you if they can so be careful with that one.

I don’t have any experience with the other CA you mentioned.

However, if I were you I would send each one of them (besides PRA) a PFD for a percentage of the total amount owed. Some may say yes, some may say no, some may not respond at all. It’s always worth a try.

Credit Cards:

Hard and fast rule of at least 3 to start with. I’d try the Discover Secured card first. Check all prequal pages before applying blindly. Also check Capital One secured and maybe a self lender loan. For another secured card, I hear that Open Sky is pretty good and they don’t even do a credit check so you’re basically guaranteed to be approved. It’s a subprime card but it’ll help the rebuild process and you can close it later when other cards open up for you. That will give you three revolving accounts and an installment loan which helps with your overall mix of credit. It’s an important ingredient in fico scoring.

STAY AWAY from Total Visa, Credit One, Indigo, and the like.

Hope some of this helps. I’m sure other will chime in and speak on anything I missed. Good luck and keep us updated! Always good to see results, keeps me motivated.

Starting Scores 1/2018:



Current Scores:

Message 2 of 13
Moderator

Re: Need Direction to Start

Welcome to the board OP Smiley Happy
"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 3 of 13
Community Leader
Senior Contributor

Re: Need Direction to Start

Convergent can be easy to deal with, though only have experience with getting Tmobile accounts recalled from them for a pay in full for deletion...  Friend of mine had some luck with ATT as well.. 

 

-J

 

 

Message 4 of 13
Member

Re: Need Direction to Start

Question: Why stay away from those few cards? I’ve looked at some and the reviews are less than stellar. However I’ve been denied for Cap1 and Discover. Before I apply for one of those, what are some reasons I would still avoid them?
Message 5 of 13
Regular Contributor

Re: Need Direction to Start

Those cards are predatory cards, meaning they’re full of fees. They usually give you about a $300 credit limit but as soon as you activate the card, your limit is decreased by a $75 or $99 annual fee. Sometimes there are extra little fees you never notice until you’re hit with them and they’re a pain to try and get removed. Some of those cards even take a while to process any payments you make and will charge you a late fee even though you made the payment in time but the issuer took so long to process the payment. I’ve heard and witnessed (second hand) so many horror stories.

If you need a card, and Cap1 and Disco denied you, I would go with Open Sky. It has its drawbacks like the $35 annual fee and it never unsecures BUT they don’t run a credit check so you don’t have to take a HP and they report to all 3 bureaus so you’ll be establishing a positive credit history. Treat that card right for 6 months and Cap1 will open right up for you.

Starting Scores 1/2018:



Current Scores:

Message 6 of 13
Member

Re: Need Direction to Start

Great! I went ahead and applied for OpenSky so Im waiting on that deposit to clear. One collection was removed from my report this week so my equifax went up +15 points! Still working on getting the others removed as well. Thanks for your help!

Message 7 of 13
Regular Contributor

Re: Need Direction to Start

That’s awesome! I’m excited to see your progression. Please continue to keep us posted on your rebuilding journey.

Starting Scores 1/2018:



Current Scores:

Message 8 of 13
Member

Re: Need Direction to Start

Looking at a Self Lender loan like someone recommended. Seems like a great idea to help build and also create an emergency fund. I’m looking at a credit simulator (I know not accurate) but it shows my score going down quite a bit. Will it help more than hurt with good payment history?
Message 9 of 13
Regular Contributor

Re: Need Direction to Start

I think it will definitely help, and like you said, it’s a great way to build an emergency fund. From all the information you’ve given, it doesn’t look like you have any open installment loans at the moment so the Self Lender will help with your mix of credit.

Please understand, most people expect to see a decent score increase from loans and credit cards, this isn’t always the case immediately. The loan is more for a marathon runner in that the benefits of it may come in a point increase, but it will mainly come in other forms like building a solid payment history and adding some good age to your account. Plus on manual reviews, UW will see that you managed a loan really well so that’s good too.

Starting Scores 1/2018:



Current Scores:

Message 10 of 13
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