Need Help!!!!

[Anonymous]

My husband and I are wondering how to increase his credit score asap. His score keeps dropping and we don't know from what! We had hopes back in November when it was a 570 and it since has been dropping and is now a 514!!! We know we need to pay down his current cards which only amounts to approximately $1500. Other than that, most of the stuff is a few years old, including a repo. We have been told something different from each mortgage lender we spoke with. We have heard: Pay off all your debt, pay off your current debt (which I can't see that increasing his score much), settle the accounts, and go through a legit credit repair agency. I am not sure where to begin. We only have about $500 extra/mo to apply to any of this. We need to get out of our 2br apartment! We already have 2 kids and another on the way. I am so frustrated and I don't know which way to turn.

Someone please help!

[llecs]

Welcome to the forums!

I'd suggest reading the following:

Common Abbreviations

Credit Scoring 101 - great for knowing what is in your credit score and to see how your score is impacted.

and What Steps Do I Take - great for learning the repair process.

Make sure you pull your two scores from myFICO. All other scores out there, unless from your lender, are not FICO scores.

I'd recommend pulling your CRs directly from each CRA to start. You can each get all three for free once a year via annualcreditreport.com. If you haven't done so, I also recommend pulling your TU and EQ FICO scores via here to see what is hurting you the most.

In general, paying off CC debt is a good thing. Ideally, you want 1/2 of your open CCs reporting $0 with the other half reporting under 9% of the CL.

Paying off collections, like CAs, can actually drop your score. Follow the "What Steps Do I Take" above for more detailed info on removing collections, legitimately, without a repair company.

After soaking up all the info, post back and someone will help you out.

[BungalowMo]

The $1500 that he owes...what % of his overall util is that??  If his total credit line is 1700, then 1500 is something like 92%.  Which is seen as maxed, pretty much.

What's his other bad stuff?  When should it drop?

[Anonymous]

Thanks! I will do this and get back soon, hopefully!

[Anonymous]

His credit cards are maxed out as of right now. This totaling $1500.

Also, his other debt consists of a repo and some revolving accounts. They are about 3-4 years old.

[Anonymous]

We also have a few duplicates on his credit report. They are from the creditor and the CA. Is this allowed? I think there might be one on there also that has one CA report on it and then the account is transferred to another CA who reported it. Can this be done?

[BungalowMo]

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@Anonymous wrote:

His credit cards are maxed out as of right now. This totaling $1500.

Also, his other debt consists of a repo and some revolving accounts. They are about 3-4 years old.

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That right there....those cards...it's killing his score!  I know it's hard because sometimes those cards become sort of a usable "income".  Been there!  Put them away.  Do Not keep them on your person.  The card with the highest interest payment...give that one a few extra bucks if you can, but pay more than min on both if you can!

Slowly chip away at it...that's a must.

[Anonymous]

But the current credit card debt ($1500) is only a fraction of what is on his report. I have heard people say they paid off their current stuff and their score only moved a few points. ???

[llecs]

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padutchgirlgirl wrote:
But the current credit card debt ($1500) is only a fraction of what is on his report. I have heard people say they paid off their current stuff and their score only moved a few points. ???

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It makes a huge impact when you pay it down below 9% with 1/2 reporting $0. If your mix of credit is good (e.g. 2 revolving and one charge card as in store, gas, etc. at the least), then a good rule of thumb is that for every 10% of utilization you pay down, you gain 10 FICO points. So, if you are at 100% utilization now, and your mix of credit is OK, then expect 100 points. Most of the points gained would occur past the 50% mark. For example, paying from 100% to 90% won't impact your scores.

Also, you mentioned that you have old revolving debt. Old CO CCs, assuming they are CO'd, may continue to factor into utilization. If you pull your FICO report, you should see that on page 2. Those have to be paid down to or removed.