Hi Guys,
I've been living in China for 7 years, and during that time I did a poor job of managing my finances in the US. I also got divorced, and my ex- got the home we owned. Now I'm returning, and I'm trying to figure out how the heck to get my credit back in shape. Would love to hear some advice.
First, my goal: I want to buy a house in the San Francisco Bay area, which means a home in the $500k range (entry level). I have quite some cash saved up so a 20% down payment for a home in that range won't be a problem.
Second, my situation:
- I'm 43 yrs old.
- Before I left, I had a credit score in the high 700's, low 800's. Owned a car (financed, then paid for) a home (mortgaged), several credit cards, etc etc. Basically spotless credit (at least for my adult life), never missed a payment for as long as I can remember, extremely low (near zero) revolving credit usage, etc.
- Having been gone for so long, I just sort of "forgot" about my US finances. Gradually over time I moved all of my money, banking, etc to Singapore and China.
- Unfortunately my 2007 and 2008 CA taxes got screwed up. This is a very long story, but even though I had no tax liability in 2008 in CA, it tuns out I was required to file a return there because I was taking income paid from a CA company into a CA bank account. I ignored the problem, it festered, and last year they filed a $26k tax lien. They also filed a lien for 2007 in the amount of $2500. I paid the $2500 lien, which should be released at this point. I re-filed my taxes for 2008, which should result in a $0 liability and a release of the lien, but CA says it will take 5 mos for that process (!!).
- I ignored my BofA banking account. Eventually they charged me some kind of fee - like $16 - and since I wasn't around to get notices, after a few months they just closed my account. Did the same thing with my credit card - they charged me some kind of $99 fee, waited for me not to pay in for several months, and then "charged it off".
- I ignored my Chase CC account. They were nice, and there were no fees or anything like that, but they closed my account for inactivity finally in Feb of this year (or maybe they saw my tax lien and decided to close it).
- So, my credit score, according to CreditKarma, is now 600 - poor. 
- I have no home in the US, no banking in the US, and basically no record of existing for the last several years. I do have, of course, tax returns showing substantial income from overseas, etc.
- SUMMARY: I have no "real" debt (the $99 "charged off" BofA CC, and two tax liens one of which is paid in full and the other which will be adjusted to zero within a couple of months I am sure), a fairly substantial amount of cash, a good income, and really crappy credit.
So my question is: What advice would any of you have for a guy like me to go from zero credit accounts and a 600 score, to a 680 credit score in the shortest amount of time possible so I can get a good mortgage. My target is year-end 2013 or sooner.
Beyond contacting the banks to re-instate my credit cards and accounts (I tried that with BofA, and short story version is they won't, at least until I show up in CA and hand them $99), I'm thinking of these things:
- I am planning to buy a car when I land. Let's say I buy a $30k car, I'm wondering if it might be better to try to finance it (if even possible), and say put down $25k and finance $5k for a year or two, just to have a positive account.
- If I can't get BofA to reinstate my CC accounts (seems unlikely), I suppose I'm going to setup a secured CC with BofA. Should I setup more than one secured CC for best results?
- Any advice on how to handle the liens? I notice as of today that they are both still showing on my report, even though I paid off the $2500 lien about 20 days ago. I know that they won't go away (right?), but seems like at least they should show the lien as paid in full.
Thanks!
Long post but I think I got the idea of your situation. So everything is pretty much paid. You need to send GW letters to those. Yes, a secured card or two will go quite a long ways in helping to establish your credit. Financing your vehicle or part of it will also give you a positive TL. Just try cleaning up the bad and add some good. You should be just fine.
July 2013 score: EQ FICO 819, TU08 778, EX "806 lender pull 07/26/2013
Goal Score: All Scores 760+, Newest goal 800+
Take the myFICO Fitness Challenge
Current scores after adding $81K in CLs and 2 new cars since July 2013
EQ:809 TU 777 EX 790 Now it's just garden time!
June 2017 update: All scores over 820, just pure gardening now.
You must go to Bank Of America and talk to manager and show them proof of over sea like you talking about. And pay for 99$. I think they can re-open your US bank. (remember bring your proof and bring 99$ pay for it. Ask them to help you. I think they will ask general manager of that bank remove it of your credit report.) it happened to my brother b4. It took 2 months for them to remove it out his credit report. Score from 590+ to 700s in 2 months.
You are... They are.... I am..... We have our heart. Bump 