I've been rebuilding since May 2012, when I tried and failed to secure a car loan. At the time I had no credit cards, three paid on time student loans, and three paid collections ($18, $112, $127). From the attempted car loan, I had four inquiries on my credit report.
My first step was the apply for a Capital One secure card. I did no research about what card to get, thus why I got a Capital One (I knew Capital One gave credit to rebuilders). I put a $500 deposit on the card and ended up with a credit limit of 651.
Since my collections were so small, someone suggested a few months later that I write letters to get them removed from my credit report. I sent registered debt validations letters to all three collection agencies. One came back validated (a copy of the returned check), one sent me a screen shot of my account (and set a dispute flag on my credit report), the other was returned with a bad address.
I then tried Goodwill letters with two of the original creditors. Cox Communications denied the request and AEP Electric approved it, though they said it would take 60-90 days to get the record off my credit report.
The next month, I sent good will letters to the reporting collection agency. Mid Continential (Cox Communications) responded as if it was a dispute and referenced my last "Dispute". I have not heard back from Payalliance. I called both collecion agencies and made it as far as the Director of Collections. No go on a Good Will Removal.
After six months of paying in full each month, Capital One gave me a hundred dollar recredit increase. I made another deposit to bring my credit limit up to $1000. I have not applied for any more credit card companies; I am waiting for the AEP collection to be removed (90 days will be up next month).
I have one additional Inquiry in Dec. My cell phone contract was up and I wanted to switch to a new providers. Otherwise, I have no other inquiries.
My Next Step is to apply for the Walmart Card and possible the Amazon Store Card. After I move in a few months, I might apply for a card at the First Tech Credit Union (my soon to be new bank).
My goal in all of this is to be able to get a decent car loan and hopefully get a Chase Freedom Card or a Discover IT. Any advice about what I can do now is very much appricated. I'm a bit worried that my collections will kill my chances for a Chase Freedom Card for the next four years.
Easy to reference details about my situation
Number of Inquries: 6
May 2012 Inquries: 5
December 2012 Inquires: 1
MID CONTINENT CREDIT (Cox Communications - Kansas)
Amount: $112 (Paid)
Drop off Date: 09/2017
Note: All debt validations and goodwill attempts are considered as disputes (even when in the letter you stress it isn't a dispute).
CONVERGENT OUTSOURCING INC (American Electric Power - AEP)
Amount: $127 (Paid)
Drop off Date: 02/2019
Note: Goodwill letter sent to AEP and was accepted. Letter stated that it would take 60-90 days to remove. Still waiting for the record to be removed.
SECURITY CHECK/ Payliance (Papa Johns)
Amount: $18 (Paid)
Drop off Date: 02/2014
Note: No success with Goodwill, though I wasn't trying that hard due to it dropping off my report in a year.
Two student loans with good payment history since 2008.
One student loan with good payment history since 2009.
One Capital One Secure Card with $1000
PIF each month.
You've done some pretty good work. All I would suggest right now is to continue the GW process. It might take a few, but I've had good outcomes from staying with the process. Good Luck!
I've been a bit hesitant to continue the GW process. I'm at the point where they reference my other letters. I've tried different addresses, different people, and different approaches, but it all seems to get funneled to the same person.
Though I guess it doesn't hurt to keep sending them letters. Give the collection agencies a little harrassment back.
I've had the same thing happen to me. Say that they are reporting correctly, see.. blah, blah, blah,, then bam... It's just gone!
Just printed out new copies of my goodwill letters. I will continue sending them out every month until it gets removed or I run out of stamps.
I got a lot of stamps.
So I just signed up for Credit Karma and it said that I have no collections on my TU report! How accurate is this? Does Credit Karma show collections in dispute?
I just bought my TU report from here and they show all of my collections still. The AEP collection should have been removed by now. Time to write a letter and refer my previous letter to see what is going on.
I think it's going to cost you more in time and postage to send GW letters for the $18 CA... are you doing that purely on some ethical grounds? Paying that would be the first step to getting closer to that car loan. Paying the other two (which are also small amounts) would be good logical steps.
My situation is somewhat similar to yours. I had several accounts with very low balances that were on my credit history report back in July 2012. I went and met with a Loan Officer and he told me since my balances were so low my best options would be to just pay them off. He also suggested I open a secured credit card to begin rebuilding my credit. I went ahead and opened a Capital One Secured Card with a $200 Limit. So far I've been paying my bills on time each month which has given me a $100 increase to a $300 limit.
I recently got a car loan back in November 2012.... To be quite honest they were unwilling to disregard my credit history even though I had paid off all my debt and the balances were so low. Their whole point is that it's still a reflection that some point in my life I was unable to pay my bills on time. They offered me a car note of $600 and we ended up talking them down to $511 a month. Capital One Auto Loan has financed me and the finance officer told me if I pay my car note on time for 18 months straight he can get me a cheaper car note. I chose to take that deal since I needed a new and ultimately this will help increase my credit score.
My goal is to qualify for a home loan. I just sat with a mortgage loan consultant and surprisingly she told me that what most people don't realize is that you should never be utilizing more than 30% of your credit limit. I was shocked because I personally had never known this to be an affect on credit scoring. I also just recently researched that trying to dispute your balances to companies will only make your account up to date which in return can have a negative effect on your credit score. I just recently applied for a new Walmart card as well so Kudos to you for taking that step. It raised my Transunion score up from 608 to 634 just by opening the account. Credit Bureas don't want you to have too many accounts however it's best to have a reasonble amount so they can see that you're able to manage several accounts responsibly. With that being said, I wish you the best of luck. This journey has definitely been a tideous one but it will soon come.
Starting Score- Transunion (567) 7/2012
Current Score- Transunion (634) 2/2013
FICO Score - 614