Paying off Debt and Credit Repair - Suggestions

[Anonymous]

Hi there, 

I am new to the community here; I am seeking advice on paying off debt and credit repair. My goal is to increase my credit score and to become more credit worthy. I am not looking to borrow anything additional at this time. My short term goal hopefully by the end of the year is to refinance my vehicle as my current intrest rate is 18% 

I have three credit cards currently. 

Capital One Platnum - Master Card I have had this card for 4 years and 3 months my available credit $500.00 85% on time payment rate. Last late payment was recorded 9/30/2018 (30 days) 

Capital One Quick Silver - Master Card I have had this card for 1 year and 11 months my available credit is $500.00 100% on time payment rate. No late payments recorded. 

Credit One Platnum - Visa I have had this card for 1 year nd 6 months my available credit is $400.00 100% on time payment rate. No late payments recorded. 

I typically carry a balance on all three cards and always make sure to make the minimum payment due. Recently within the last 5 days I have paid off all of the balances on all three cards. All cards now have a zero balance. - I don't intend to use them. 

It was suggested that I sign up for Self Secured Loan https://www.self.inc/ I have a loan that I pay $25 a month I have had this loan for 11 months current balance still owed is $325.00 at the end of the 24 months with this loan I would have saved $525.00 all payments have been made on time. - not really sure if this helps or hurts my score. 

I have 6 accounts with a "Negative" status

1) was a medical collection - I have paid in full. was paid 9/16/2019 it shows payment status: collection/chargeoff account status: paid in full. The attorney that handled the collection will not remove. I have tried. Balance is and shows $0.00 - this shows up as a closed collection on my credit report 

2) Portfolio Recovery Capital One status is derogatory collection/chargeoff amount $439.00 age of account 4 years and 7 months no payment details are being reported. this account reports monthly status date reported 9/18/2020 - this shows up as a current collection on my credit report 

3) Portfolio Recovery Capital One status is derogatory collection/chargeoff amount $484 age of this account is also 4 years and 7 months no payment details are being reported. this account reports monthly status date reported is 9/18/2020 - this shows up as a current collection on my credit report 

4) First Premier Bank - shows on credit report as collection/chargeoff derogatory - does not show as a current collection. amount owed is $425.00 opened 2/9/2015 closed 5/17/2015 last reported 9/6/2020 just received a settlement letter last week to settle "paid in full" for half of what is owed. 

5) Kohls Dept Store Collection/Chargeoff derogatory - does not show as a current collection. amount owed is $511.00 opened 10/27/2013 date account closed 8/10/2014 last date reported on credit report was 11/30/2014

6) Target TD Bank Collection/Chargeoff derogatory - does not show as a current collection. amount owed is $442.00 opened 10/27/2013 closed 11/23/2014 date last reported on credit report was 9/24/2020

My current credit scores 

Creditwise (capital one) transunion 553 

Credit Karma transunion 553 Equifax 561

Credit Seasme transuntion 553

Credit Journey (Chase) Experioan 552

Experian FICO 606

My thoughts are to pay the two Capital One accounts that show as current collections (2 and 3 above) these two accounts show as current collections. I would like to ask for a settlement - paid in full. I am honestly not sure that both accounts are accurate. I am not receiving collection calls from either one of these cards. So it would be me reaching out to them to satisfy the debt. - Suggestions? 

Next the above number 4 through 6 show on my credit reports as closed accounts not active collections. I would like to move forward with number 4 and accept their settlement. I am not receiving colletion calls from either 5 or 6. My thoughts with number 5 above the last date anything was reported on my credit reports being in 2014 why would I mess with it? 

Any suggestions would be greatly appreciated, I am not opposed to paying all of them off. Will take some time if that is best action to take is there a strategy as which one I should pay first anyone would suggest? 

Thank you in advance, 

CC 

[Anonymous]

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@Anonymous wrote:

Hi there, 

I am new to the community here; I am seeking advice on paying off debt and credit repair. My goal is to increase my credit score and to become more credit worthy. I am not looking to borrow anything additional at this time. My short term goal hopefully by the end of the year is to refinance my vehicle as my current intrest rate is 18% 

I have three credit cards currently. 

Capital One Platnum - Master Card I have had this card for 4 years and 3 months my available credit $500.00 85% on time payment rate. Last late payment was recorded 9/30/2018 (30 days) 

Capital One Quick Silver - Master Card I have had this card for 1 year and 11 months my available credit is $500.00 100% on time payment rate. No late payments recorded. 

Credit One Platnum - Visa I have had this card for 1 year nd 6 months my available credit is $400.00 100% on time payment rate. No late payments recorded. 

I typically carry a balance on all three cards and always make sure to make the minimum payment due. Recently within the last 5 days I have paid off all of the balances on all three cards. All cards now have a zero balance. - I don't intend to use them. 

It was suggested that I sign up for Self Secured Loan https://www.self.inc/ I have a loan that I pay $25 a month I have had this loan for 11 months current balance still owed is $325.00 at the end of the 24 months with this loan I would have saved $525.00 all payments have been made on time. - not really sure if this helps or hurts my score. 

I have 6 accounts with a "Negative" status

1) was a medical collection - I have paid in full. was paid 9/16/2019 it shows payment status: collection/chargeoff account status: paid in full. The attorney that handled the collection will not remove. I have tried. Balance is and shows $0.00 - this shows up as a closed collection on my credit report 

2) Portfolio Recovery Capital One status is derogatory collection/chargeoff amount $439.00 age of account 4 years and 7 months no payment details are being reported. this account reports monthly status date reported 9/18/2020 - this shows up as a current collection on my credit report 

3) Portfolio Recovery Capital One status is derogatory collection/chargeoff amount $484 age of this account is also 4 years and 7 months no payment details are being reported. this account reports monthly status date reported is 9/18/2020 - this shows up as a current collection on my credit report 

4) First Premier Bank - shows on credit report as collection/chargeoff derogatory - does not show as a current collection. amount owed is $425.00 opened 2/9/2015 closed 5/17/2015 last reported 9/6/2020 just received a settlement letter last week to settle "paid in full" for half of what is owed. 

5) Kohls Dept Store Collection/Chargeoff derogatory - does not show as a current collection. amount owed is $511.00 opened 10/27/2013 date account closed 8/10/2014 last date reported on credit report was 11/30/2014

6) Target TD Bank Collection/Chargeoff derogatory - does not show as a current collection. amount owed is $442.00 opened 10/27/2013 closed 11/23/2014 date last reported on credit report was 9/24/2020

My current credit scores 

Creditwise (capital one) transunion 553 

Credit Karma transunion 553 Equifax 561

Credit Seasme transuntion 553

Credit Journey (Chase) Experioan 552

Experian FICO 606

My thoughts are to pay the two Capital One accounts that show as current collections (2 and 3 above) these two accounts show as current collections. I would like to ask for a settlement - paid in full. I am honestly not sure that both accounts are accurate. I am not receiving collection calls from either one of these cards. So it would be me reaching out to them to satisfy the debt. - Suggestions? 

Next the above number 4 through 6 show on my credit reports as closed accounts not active collections. I would like to move forward with number 4 and accept their settlement. I am not receiving colletion calls from either 5 or 6. My thoughts with number 5 above the last date anything was reported on my credit reports being in 2014 why would I mess with it? 

Any suggestions would be greatly appreciated, I am not opposed to paying all of them off. Will take some time if that is best action to take is there a strategy as which one I should pay first anyone would suggest? 

Thank you in advance, 

CC 

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First, ignore any % of on-time payments, that is a Vantage score thing, and if you have late payments, getting further away from them is best. 

Congrats on paying off your open CCs! I want you to know you can control what reports to your CRs, because the higher the balance you let report, the lower your score is. You can use your CCs all you want, but need to make sure to pay them off before the statement cuts and reports to the credit bureaus. Just be sure to leave a small balance to report on one of the CCs (less than 9% of the CL - usually $5-$10 bucks is enough to report) so that way you do not get an "all zero" score penalty. This is what we call AZEO. Feel free to look into this further in the forums. The statement cut date is usually different than your due date. Me and my SO have Cap One CCs and the statement cuts usually 3 days after the due date. So we make sure we are all paid up by the due date and do not charge anything until statement cuts and then go back to using the CCs, rinse and repeat.

I would also use your CCs more like debit cards and avoid paying minimums so that way you earn money via rewards instead of paying interest. Might as well make money off the banks instead of them making money off of you! So if you can pay for it by the statment cut date, do not charge it. Just an idea to maybe help create better habits. I definitely treated CCs like money I did not have, but since changed that habit, and it has been so nice to build up cash back instead of worrying about making payments and all the interest I will have to pay!

The CAs and COs are really hurting you score-wise. So those will take some work, but it can be dealt with!

Thankfully PRA (Portfolio) does PFD (pay for delete - the CA will be removed but the original account will remain) as a matter of policy, so I agree you can hit those first to pay so they come off your credit reports. PFD is reserved mostly for CAs and not OCs. You can always ask if they will do PFD, but it is most unlikely. PRA is the low hanging fruit, but with the medical collection still reporting (even though paid), will likely not yield you a huge gain since you will still have a CA reporting. The biggest gain is when the last CA is gone off your CRs.

After paying any of these baddies off (even the one have paid) you can always go on a GW campaign (search the forums for your specific creditors and see if there others have had success with it and how to go about it). Cap One and First Premier have been granting these more frequently than before, but it is no guarantee, so it may not happen the first, fifth, or tenth attemp, but it is always worth persuing, as all you have is time between now and when they age off, so you might as well try!

Now, DoFD (date of first delinquency) is more important than date of last activity. That will tell you when the clock starts on the 7 year reporting window and when to expect accounts to fall off your credit reports - paid or unpaid. Now even if they fall off, that doesn't mean you still dont owe these debts, but as long as you have not called and confirmed the debt is yours, set up payment arrangements, or made payment towards these debts, you will not reset the SOL (statute of limitations). This can help prioritize where to put your efforts ($$$) first.

I would say first step is pull all 3 CRs from annual credit report for free (no scores). This is for a couple reasons: 1) they are the most comprehensive CRs around I can find and 2) they will specifically list when accounts will fall off. TU will list "estimated date of removal" dates. EX will list "on record until" dates. EQ will list DoFD - add 7 years to that date and that is when the TL(s) should naturally age off. If you are within or close to 6 months of them coming off, come back amd we can guide you through EE (early exclusion). This could be a possibilty for 5 & 6 in the near future.

Thise COs are factored into your utilization, so that means lower scores because of it, as anything CO'd or closed with a balance is automatically considered maxxed out. So dealing with these accounts should net you some gains, hopefully.

If you wait out those last couple debts while working on the other ones first and they age off, you will see a score gain then too. You can always circle back later and pay them even if they are not reporting so you can get back in with those creditors in the future.

Since you are not in a rush to app for anything, you have a good chance to get a few or many of those baddies off your credit reports with perseverance! Hang in there and it can be done! But as a side note, in the future when you are in a better place to app for credit, maybe branch away from Capital One, as right now you have all your eggs in one basket.

Most importantly, comb through those CRs to be certain you are not missing anything and to make sure there are no fraudulent accounts, etc.

lastly, avoid disputing at all costs unless it is absolutely erroneous or fraudulent. Disputing can have some negative affects if you do this to accurately reporting accounts and there are possibly other avenues to go first before doing a dispute. 

Always feel free to come back and ask any questions or need more info!

Good luck!