Please help me begin this process. I need some help.

[Anonymous]

My question is: how does one go about improving their credit score when it seems that paying on collections damages the score and most CA won't take a PFD request easily? I would like to also try to get a secured credit card but I am not sure how they approve on those. I've heard of people getting them with a 550 and others not with a 610. My current scores are 593 Equifax and 602 TransUnion.

I have saved about $3000 for a new car for work and school. I am very afraid to be rejected for a loan at Volkswagen and hurt my credit score further.

I have tried about a year ago to do a PFD with a collections bill that was rejected. I owe about 2k to various credit agencies. I am now in a stronger position to pay, no longer homeless, and want to do this right but don't want to hurt my credit in the long run doing so. I am in my 20's and don't fully understand all of the intricate details of credit building.

Thank you for your help.

[Anonymous]

Credit Karma showed me at a 460 and 480 and Citi approved me for a diamond secured. I do have positive revolving accounts perhaps that played a roll. a 200 first Premier (yuck), (secured) I'm an authorized user on husbands 1k first Premier secured, 2 bank of mo awful cards (unsecured) (total Visa and milestone) and fingerhut with a high limit (2k). hope this helps.

you should be ok on a car loan. the interest rate will be high but if you have verifiable income and are willing to do the legwork someone will give you the loan. one of my cars is with credit acceptance, and they customer service reps are mean and the interest rate is probably 23% but we needed a car and the payment is reasonable.

[aynot4fitness]

One good piece of credit rebuilding advice I've gotten is this: The best way to battle negatives on your credit report is to add as many positives as possible. Here are some things that worked for me after my CH7:

Credit Cards: About 1 year after the BK I was approved for a secured card from Aspire Bank and Merrick Bank - 6 months later was approved for an unsecured Cap1 card. I then closed the Aspire account. I kept Merrick because they are awesome with regular quarterly CLIs as long as you pay on time every month, and more than the minumum. It was well worth the $300 security deposit which was refunded 1 year later. If you're worried about rejection, then go to the Cap1 web site and see if you pre-qualify. A pre-qual will at least tell you if you can get a card and does not trigger a HP so it won't affect your score.

Auto Loan: With the BK my car was repo'd. The mistake I made was saving up $5,000 and buying a car cash. I assumed I would get rejected for a loan because I didn't know about sub-prime auto lenders. With the right legit lender I would have paid very high interest, but that $5,000 would have been a great down payment on a $15K-$18K car. If you can't get approved by a prime lender, then a sub-prime lender who reports to the CAs is better than paying cash and you get a much more reliable car. Again, its another positive account against your negative accounts. Just be sure the lender reports to CAs - some do not. If they don't report then it won't help you.

My first auto loan after the BK was with Santander Bank. I'm pretty sure a dealer arranged it, but you can check on your own. About 2-1/2 years after the BK and repo Santander approved me at high interest and required 30% down, but I got a decent car. Since then I've found Cap1 Auto very helpful. Cap1 Auto also has a pre-qual site so you can see if you qualify without hurting your score.

I don't remember my FICO scores from back then, but I'm sure I was in the mid-500's across the board. It's not easy to gently nurse those delicate scores back to good health but it is possible.

[simplegirl]

All my accounts have negative payment history and all but 5 is closed. I have a repossession and charge offs and collections but citi instantly approved me for a car and I hadn’t even paid anybody before the approved me.

[Anonymous]

I am new to this forum and like you I am in the beginning stages of trying to repair my credit. after doing a little reserch I found a few options to get add positive tradelines to my credit report in the past week. The first was a credit builder loan with "Self Lender". Once approved you open an account which costs less than $10.00. They will approve you for a $500 loan that will be deposited in an account. You make $25 a month payments to them for 2 years and when done they give you the $500. You are basicly funding your own loan before they give you the money but it gives you a tradeline with 2 years of payment history when done. I also found a company called FigLoans, I was able to qualify for a $500 loan which they do give you in the beginning. I will make $111.00 payments every month for 5 months until the loan is paid back, this too will be a positive tradeline on my credit report with a 5 month payment history. Another tradeline option I am looking at and will probable sign up for today is RentTrac. I live in an aprtment and pay rent every month so by signing up with RentTrac they will report my payments every month to all three credit bureau’s. I don't know much aboyt RentTrac except for what I have read in various articles but everything seems to be possitive. Others on this site may be able to provide more information.

My next plan of attack after RentTrac will be to get three revolving credit accounts, from what I have read OpenSky seems to be a pretty good secured card to get and you will get approved regardless of your credit score. I have also heard that a Walmart and Victoria Secret unsecured credit cards are fairly easy to get even with bad credit but I have not applied for either one yet.

Good Luck! 

[Anonymous]

Good job reaching out for help. This forum provides tremendous value to folks like us.

You're wise to invest in yourself. A small deposit (~$500) toward a couple of tradelines can go a long way. Google "Capital One pre qualify" and see if they have you on the list. I started Cap1 and Disco secured accounts that way, two years ago.

Are your collections medical related?

[Anonymous]

The bills are, for the most part, not related.
One is for T-mobile right before being homeless
One is for sprint after losing my job a second time in 2017.
One is for charter communications, had to have internet for work in 2015.
The last is for an uncovered medical bill less than 100 dollars.
In total I owe close to $2000.
I have a $2950 student loan to cover tuition and books that is current and being paid on.

I'd like to pay these debts off and begin the process of healing credit. I don't want to leave them in collections but I also don't want to be punished for paying. Is there a way, since these are such small amounts, to get CA to listen and take a PFD?

Also, I don't know how I feel about taking random personal loans out. I hear the interest rates are killer and I don't want to put myself in unneeded precarious positions. Only using loans and credit for absolute needs. Such as a car or a home or emergency medical bills. Sorry if this comes off harsh, perhaps I just don't understand.

[dynamicvb]

OP, it sounds like you do not have any open tradelines on your report. Is that correct? If so, you are going to have to get some reporting. If you do not have an open credit card, then that is easily 30-40 points you are missing maybe more, but this is one of those areas where YMMYouYuo can likely get approved for a secured card at either Captial One or Discover. I would try the pre-qual sites for both and see what they offer.  I got my first CC with CapOne after I started rebuilding and at the time my score was not much better than yours.

It also sounds like the scores you posted at from Credit Karma, if that is the case, then you will want to get your real Fico scores so you will know where those are at currently. You can get a trial at CreditCheckTotal.com for a buck, just cancel before the trial is up. 

You may also need a loan, but I would stay away from those predatory lenders. A small self lender will work just fine and you only need one. I'm pretty sure the FigLoans mentioned in another thread is a consumer finance account so you want to avoid those type of loans.

Paying off the collections will help you in the long run and always look better on a manual review. It's best to get those paid off so they stop reporting and will start to age. Always try for the pay for deletes, but some people just won't do them. Paid is better than unpaid. It may not help your score initially, but over time them being paid and not updating will.

[Rogue46]

I barely got a loan through VW credit with a 635 score in 2017 and had to put up $1500 cash for them to consider it. However you should be ok with a subprime lender but interest will be higher.

[Anonymous]

If you can’t pay the collection accounts they will be less of a factor as time goes on. Try to get a secured card and pay in full every month. You can also try to disputed any inaccuracies on all three credit bureaus to start.

I wouldn’t pay the collection accounts until you verify that the collector has the legal right to collect and that they have accurate information about you. Most of the time they don’t have good data.