Re: Seeking advice on my credit rebuild plan

FireMedic1 · ‎10-15-2021

@Anonymous wrote:
I suppose that's what's somewhat confusing, they were reporting them as chargeoff's way back but sometime between 2018/19 (when I finally just assumed I'd have to just live with it for 7 years and stopped checking my credit) and april of this year they were removed from all my reports with only the entries for midland and pra showing. I'm not certain how they got removed but I am happy to simply let sleeping dogs lie as it were, and not question it.

To be clear and concise citi and capital one are not reporting anything on my reports. Nice.

edit -
Also for some reason the last month chase reported was Aug 2018 and I'm assuming that's why the reports say my utilization is only around $900 which is what the discover and bofa reporting balances add up to.

second edit:
That reporting balance is also why I was considering just paying discover and then bofa first and then deal with the collections and last but not least chase. But since apparently cap one doesn't care I'm thinking now just starting a settlement process with pra. Offering say 200-300 and see what happens. Also if citi won't find out then perhaps look to settle with midland next. then discover pif and bofa pif.

Since Chase, Disco, and BoA are CO'ed with balances. They still own the debt. So do what you can to settle these. They are killing your scores. Once they are done. Here comes the $0 balance. No more monthly updating. As stated before PRA and Midland will be toast off your reports forever. No more collections. But the sooner you act on the CO's the better. You dont want those 3 go to collections and have more hits against you all over again. Nice you want to tackle this and get it in the past. Best of luck!!!!!!!!

SoonerSoldier33 · ‎10-15-2021

@Anonymous wrote:
I suppose that's what's somewhat confusing, they were reporting them as chargeoff's way back but sometime between 2018/19 (when I finally just assumed I'd have to just live with it for 7 years and stopped checking my credit) and april of this year they were removed from all my reports with only the entries for midland and pra showing. I'm not certain how they got removed but I am happy to simply let sleeping dogs lie as it were, and not question it.

To be clear and concise citi and capital one are not reporting anything on my reports.

I had this happen as well. I had 2 COs...one from Capital One, and one from Synchrony Bank. Both banks sold the debt to PRA, and then subsequently deleted the original CO tradelines from my reports leaving only the PRA CAs reporting. I don't know how or why, but count your blessings like I did. When you pay/settle with Midland and PRA those 2 negative accounts will vanish without a trace from your reports like they never happened.

edit -
Also for some reason the last month chase reported was Aug 2018 and I'm assuming that's why the reports say my utilization is only around $900 which is what the discover and bofa reporting balances add up to.

Ok, this changes things a little with Chase. I don't want to deter you from seeking a settlement, but you should know how this works. When a revolving CO has not been reported to the CRAs in the past 24 months, the balance no longer affects your utilization (as you've noted), and the CO status actually begins to age. When you pay/settle a 'dormant' CO like this, when the lender updates the account, you will very likely be hit with a 'catch up' penalty, as they will fill in all the missing data since the last time they reported. The CO status will hit your reports as a fresh CO damaging your scores, and you will not receive any score increase from the $0 balance, bc the balance is not affecting your revolving utilization right now. This is one of those 'special' times where doing the right thing and paying/settling a past debt can actually HURT your scores. So, I would certainly leave Chase for last, and make a decision on how best to proceed with them once you have paid/settled your actively reporting COs and CAs.

second edit:
That reporting balance is also why I was considering just paying discover and then bofa first and then deal with the collections and last but not least chase. But since apparently cap one doesn't care I'm thinking now just starting a settlement process with pra. Offering say 200-300 and see what happens. Also if citi won't find out then perhaps look to settle with midland next. then discover pif and bofa pif.

Forget Citi and Cap One. They sold your debt and removed their tradelines. They've washed their hands of your accounts. I would absolutely attack the CAs first. Call PRA and Midland (as you are financially able), and work out a settlement agreement in exchange for PFDs. You don't even have to ask PRA. You do want to request it from Midland, but they're usually very easy to get PFDs from. Then I would move on to attempting to settle the COs. You don't want those to end up in collections too.

Team Garden Club as of Oct 2021

Anonymous · ‎10-16-2021

@HowDoesThisAllWork

No worries I don't take any offence at that, you're absolutely right in that I'm overthinking this. I tend to like to have contingency plans for middle case, bad case and worst case scenarios and then have contingency plans for those in case they fail.

And for the next week or so I'm willing to indulge in that. As the one thing I did learn from my financial meltdown is that I need to always have at least 3 months in emergency savings. That was drawn down last month for some large car repairs, but will be back at full in the next week or worst case by the end of the month. So I'm just using that time to somewhat indulge in drawing up plans, but much more so just figuring out the exact plan of attack.

As of next month though I will have somewhere between 1000-2500/month to deal with paying all of this off. So certainly by the end of the year everything except chase will be taken care of.

I did pull all 3 of my reports through annualcreditreport.com, although transunion did error out for some reason, so tu is being sent through the mail. But I do have access to all 3 through experian. And other than reported payment history and inquiries, they're all identical.

I'm fairly confident that cap1 and citi did sell the debt as they don't report anything at all on any reports.

I went to the sites for both pra and midland, didn't agree to anything, but just to see where I stand. Midlands had a popup, that I took a screenshot of, that did say to the effect that they will not sue due to age of the debt, and it seems at least, according to their faq page that it's their policy to delete if the debt was over 2 years old, once settlement is paid. As for pra, they say they will not sue nor resell the debt, and will remove after final settlement/payment.

Currently the worst case scenario I have for this would be midland selling the account, and simultaneously bofa, chase and disc, passing them to a ca that doesn't do pfd. I don't see that as all that likely at least in the next 2 months, when I'd have everyone but chase paid.
Bad case would by I pay pra and midland and that somehow causes cap one and citi to add themselves back on to my reports. Not certain how likely that is and if it happens, it happens, And I suppose both cap1 and citi would have to report 0 balance, and with pra and midland gone and cap1 and citi added it should still be a net positive.

Bad case I'm somewhat worried about would be if I pay the collections first and before I can pay bofa and disc they pass it on to a collections that doesn't pfd. Given that, I think it might be best to simply pay disc, then bofa, and then midland, and then pra (since they stated they will not resell the debt). Chase has to be last just because of the size and I'd rather have (at worst case) 1 new collections than 3.

As for the credit, I started that when I was still operating under the premise that any action taken towards these accounts would reset the 7 year reporting clock. Although to be fair I think I still would have taken those steps first, as none of them are really having an impact on the timeline of paying these off. However, I won't be looking into adding any more accounts until at least bofa, disc, midland and pra are paid off.

So current plan of attack is, either before the end of the month or worst case sometime in the first week of Nov pay discover. Then within a week or two after, pay bofa. Then find out what midland is willing to settle for and ideally in another week or two settle both midland and pra. Then reassess everything from there.

Or actually alternatively how likely is it that bofa, chase and disc would agree to a payment plan? Instead of paying disc first, get the 550 for bofa and if they agree to a payment plan of say 100 a month then call up disc and use the rest to either pay it in full if they don't agree or again around a 100/month. Then either see about a payment plan for pra and midland or just settle/pif. Then as soon as I have let's say 1,000 call up chase (they did send a letter last year looking to settle the debt for 900) and find out if they'd agree to a payment plan of let's say 300-400/month. If they all agreed to that, then by the end of next month, I wouldn't need to worry about any new collections and this would all still be paid off basically on the same time period, as I'm assuming they'd be more than thrilled to have prepayments to bring the balance down faster.

I suppose the only drawback is I think inquiring about that with chase would reset the sol so if they didn't agree and would only accept pif, they could I suppose sue me prior to me having the $4000.

Anonymous · ‎10-16-2021

@SoonerSoldier33

I had this happen as well. I had 2 COs...one from Capital One, and one from Synchrony Bank. Both banks sold the debt to PRA, and then subsequently deleted the original CO tradelines from my reports leaving only the PRA CAs reporting. I don't know how or why, but count your blessings like I did. When you pay/settle with Midland and PRA those 2 negative accounts will vanish without a trace from your reports like they never happened.

Is there any possibility of cap1 and citi adding these back onto my report once pra and midland are gone. I suppose it doesn't really make a difference to my plans either way but would like to know what to reasonable expect.

Ok, this changes things a little with Chase. I don't want to deter you from seeking a settlement, but you should know how this works. When a revolving CO has not been reported to the CRAs in the past 24 months, the balance no longer affects your utilization (as you've noted), and the CO status actually begins to age. When you pay/settle a 'dormant' CO like this, when the lender updates the account, you will very likely be hit with a 'catch up' penalty, as they will fill in all the missing data since the last time they reported. The CO status will hit your reports as a fresh CO damaging your scores, and you will not receive any score increase from the $0 balance, bc the balance is not affecting your revolving utilization right now. This is one of those 'special' times where doing the right thing and paying/settling a past debt can actually HURT your scores. So, I would certainly leave Chase for last, and make a decision on how best to proceed with them once you have paid/settled your actively reporting COs and CAs.

Aproximately how bad of a hit will that be? Irregardless I'm going to pay them in the end, both to try and keep them as an option in the future, and my own personal code of morality is that it needs to be paid as I do owe the money. But also from a practiacl pov I'm assuming that if they did pass it to collections they would update then and I'd also have a collections ding to my scores.

Forget Citi and Cap One. They sold your debt and removed their tradelines. They've washed their hands of your accounts. I would absolutely attack the CAs first. Call PRA and Midland (as you are financially able), and work out a settlement agreement in exchange for PFDs. You don't even have to ask PRA. You do want to request it from Midland, but they're usually very easy to get PFDs from. Then I would move on to attempting to settle the COs. You don't want those to end up in collections too.

For citi and Cap1 it's much more so just curiosity as to how/if data gets back to the oc once debt has been sold to collections. From a legal perspective and my own code once a debt is sold I don't owe the oc anything at that point. However if possible I would like to resolve the debt in such a way that I could do business with the oc in the future if at all possible.

Prior to making any payments I'm gonna do some more reading and will post my plan for each one for feedback to make sure I'm not making any mistakes or overlooking something.

Edit -

I'm gonna do some reading on the forum but how do you put the message your replying to in your response like you and others have done? I just assumed if you hit the reply button it would auto put it in, but obviously not. So I just copy and pasted it.

GrandBay · ‎10-17-2021

@Anonymous

do not focus on scores

or recovery of said scores

focus on paying the collections and charge offs

at some point your "score" will recover

the monies being spent on Self Lender etc

should be going to your debts

after those debts are paid you can indulge in rebuilding

fyi: SeedFi is less expensive than Self Lender

they only charge $1 per month and you can treat it like an SSL

FireMedic1 · ‎10-18-2021

@AnonymousOn your opening stats when I kindly asked to list the debts separately you listed this:

Chase

charged off

balance - 3900

dofd - Oct 2017

Then you said your util isnt being affected by it. Just 900 dollars on 2 accounts. What is it showing now? Did it change to $0 balance suddenly? I see that you use Experian. Login and see what the util % is showing bottom left box left side.

Anonymous · ‎10-18-2021

@FireMedic1

For the utilization rate I took the worst case from any of the credit monitoring sites I am signed up for:

credit karma - no data

cap 1 creditwise: 0%

amex's mycreditguide: 0%

discover's creditscorecard: 106% with 850 for the balance and the only 2 accounts that add up to that are the bofa and disc.

Experian: on the Amount of debt tab on the Fico Score 8/score ingredients page: 106% with 850 for the balance and 2 accounts with balances

As for the official reports, they all list utilization at 0%

The summary page:

Credit Usage:

0% Credit Used: $0 credit limit: $0

Accounts:

Open accounts: 0

Accounts ever late: 5

Closed accounts: 3

Collections: 2

Credit & retail cards: 0 accounts $0.00

Real estate: 0 accounts $0.00

Loans: 0 accounts $0.00

Collections: 2 accounts $1317.00

Self Reported: 0 accounts $0.00

Total: 2 accounts $1317.00

edit: I forgot to include what the current balances are showing:

According to experian date Oct 18, 2021:

BofA - 550

Disc - 300

Chase - 3900

PRA - 450

Midland - 867

Anonymous · ‎10-18-2021

@GrandBay

The thing with the scores though is that effectively I'm viewing this as somewhat of a game right now. That has both legal, moral and financial conditions for winning/losing.

From a legal standpoint the only repercusion for taking no action is the accounts keep reporting and I suppose new collections could come and go until 2024/2025. So then the only way to lose the legal game would be to take any action that would reset the sol.

From a moral standpoint, I do owe and need to pay the original creditors in full. However if they've sold the debt then, at least according to my own code, I have no obligation at all to pay a company that buys the debt. Also there's no real timeline as far as when I need to pay the debt.

From a financial standpoint, the game is all about having the most options for the future, trying to foresee possibilities and having plans and finances in place to handle that.

So the overview of this game is it's a balance between legal, moral and financial.

The objective of the game is to be able to withstand the financial setbacks of life, which is why the primary focus is first and foremost right now of getting my emergency fund back to a full 3 months of savings. And secondly to put myself into a position to achieve my financial goals and plans.

The rules of the game:

The number one rule is take no action that would even have a remote possibility of resetting the sol.

The second rule is all actions must be in alignment with the objective of the game.

The third rule is as soon as is feasable pay the debt (but again it has to be in such a way that it doesn't violate rule 1), and ideally in a way that I'm not punished for doing so.

The fourth rule is pay off the debt in such a way as to keep options open for the future.

The fifth rule is take new actions (ie open new cc accounts or loans) to widen my financial options in the near and long term, so long as it doesn't really violate rule 3.

The final rule is any actions must first refer to rule 1 and then, in addition, if it would seriously impact rule 3, the action is disallowed.

So the thing is if I didn't focus on scores my plan of attack would be entirely different.

First get my emergency savings back to 3 months.

Second, it occurs to me that while yes I can use that emergency fund for unforseen expenses. The problem with that is alot of things I would tap into that account for aren't necessarily truly unforseen.

While yes the car breaking down recently in the exact way it did, with the amount that it did, and the exact time that it did wasn't really forseeable. In the end it's a car and cars will break down, so in that way it is forseeable.

Just as it is forseeable that at some point I will probably have some healthcare related expenses that either hit the deductible or insurance doesn't cover.

Or my apartment complex could change ownership, or for whatever reason my lease isn't renewed one year; in which case I'd need to have first, last and security deposit for a new place.

So with all that in mind if I just ignored scores right now the plan would be:

get emergency fund fully funded by the end of the month
open a savings account, call it debt payoff, and deposit let's say $20 or so per week into it. and as the amount meets the various account's debt then pay that off.
Open a car expenses savings account, and next month start putting all the money I'm currently putting towards my emergency fund (varies between $1000-2500/month) towards that with the goal of between $5-10k
Open a health savings plan (i think that's what they are called), and as soon as the car expense fund is fully funded put all the money towards this with a goal balance of somewhere around 5k
Open a apartment savings account, and get somewhere around 5k in that.
Increase my general emergency fund to 1 year of expenses.
Once all of the above were met then put all the money towards the debt payoff account.
Around the time that all of these accounts are falling off my report I'd have all of the oc pif.
Once the debt's paid off and having a clean credit report look into building credit.

So for now if I do focus on scores then while I'm aggresively saving money to pay the debt off in accordance with the rules. I figure I can continue to use the emergency savings as I have been, which is just a general fund for emergencies.

I can open a few accounts to get some positive history on my reports, as I currently don't have any open accounts reporting.

and in that way if I needed to I could possibly go get a car loan, if I absolutely had to, prior to having the car expense fund fully funded.

Also in the end, instead of starting with a clean slate in 2024/2025, I'd have 3-4 years of positive history.

For now I won't open any accounts where the amount put up (ie security depost) or the monthly amount would have more than a minor impact (defined as an amount that would set the debt payment back more than a week), until bofa, disc, midland and pra are pif or settled in the case of collections.

edit - and the minor impact would actually be in totality so while opening 1 secured card with say a $200 security deposit would not set this back by a week, 2 or more each with a $200 security deposit would.

In regards to Self, the primary motivation there was in a few months it's not just a installment loan, it would become a revolver with the payments just increasing the cl each month. and thereby reporting twice for no hard pull.

Thanks for mentioning SeedFi. assuming I can't get a ssl with a credit union, I'll look into them as soon as self loan is pif.

FireMedic1 · ‎10-18-2021

Ah ok. Where @SoonerSoldier33 says above after 24 months a dormat CO util isnt counted isnt the case. Overall Util is taken into account and is reflected in the 106% util. Thats from all the charge offs. Which are like a maxed out card. Where you listed the 0% util. Those are Vantage scores whereas Discover Scorecard is FICO. Once all of them are settled or PIF and you reach FICO $0 balance. Yes there will be a nice bump that will over ride the update once it is settled. So you already know what to do. That part was a bit confusing. I wish you nothing but the best on your rebuld journey. Hey if us minions can rebound so can you. Good Luck!

FireMedic1 · ‎10-18-2021

You can get some secured cards so you have some open accounts. FICO doesnt care about how high your credit line is. Its whats reported. So say you get 3 secured cards at $200 a piece in time and practice AZEO. Your good to go. OpenSky is no HP for one. Just stay away from the monthly fee ones. You got the plan down right. It will pass by quick. Seems like yesterday I got my BK DC. Here it is 6 yrs later.

Yes Vantage is funky. The VantageScore model does not count closed accounts; only open ones are used to calculate credit age. Closed accounts still count at least when it comes to your FICO score. And whats a CO? Closed. ¯\_(ツ)_/¯

Seeking advice on my credit rebuild plan

Get your FICO® Score for free