Stuck in Toy limit land….

[anik28]

I've made financial goals for myself for 2022 and looking at my overall credit file; I'm not applying for any cards until June 2022, but do check all the majors for soft pull approvals.

I feel a bit defeated after all the hard work I've been doing on my credit - I still am stuck in toy limit land. My two highest limit cards are retail, which is great - but for 2022 I really want to grow my current limits or obtain new products so I can close some of the toy limits. I'm working on paying off the small limit cards and not using them. They don't serve me a purpose besides small bills. I know just waiting will be helpful but for about 2 years I've been cleaning up my profile and still am not getting the cards I've been aiming for. Current score is 640 for Fico 8 across the boards, hopefully I can pick up another 40 points when I pay off all the small limit cards this month. I think even though I've really cleaned up my profile and am down to only 1 negative item (medical bill) that carrying small balances has drug down my scores.

current limits.

Nordstrom - 7000$ CL

Care Credit - 2000$ CL

Merrick Visa - 700$ CL (1400$ in April 2022)

Credit One AMEx - 700$ CL (they just gave me an increase after only 3 months)

Cap One QS 1 - 500$ CL (no increases for 3 years)

US Bank Secured - 300$ CL

Target Red Card - 300$ CL 

Pen Fed Auto Loan - 21K Balance

Personal Loan -3500$ balance 

from this time last year I've made huge achievements, the whole rebuild process has been a lot slower than I imagined and reading the approvals board doesn't help. Lol. Keeping my eye on the prize and knowing here shortly I can shed some of these small limit toy cards. Any suggestions on how to boost my scores besides lower utilization? Current UTL across the board is 39% - aiming to get this down to about 10% by March 2022. I would really love to at least be able to get a Disco or better Cap One card this year, with my sights set on an Amex or Chase in 2023 when I am 5/24.

[FireMedic1]

Lets start with listing your accounts:

Creditor/ Credit Line/ Balance Owed.

List any baddies after that.

Something is holding you back, but those arent bad CL's for store cards. We'll figure it out.

[anik28]

@FireMedic1 

Nordstrom / 1800$ balance - 7K Limit

CareCredit / 800$ balance - 2K Limit

Credit One AMEX / 399$ balance - 700 Limit

Merrick Visa / 600$ balance - 700 Limit 

Cap One QS 1 / 175$ balance - 500 Limit

US Bank Secured / 100$ balance - 300 limit (just paid this down and hasn't reported yet. I think I'll gain some points)

Target Red Card - 150$ balance - 300 limit 

AMEX AU (1400 limit, 0 balance)

Loans:

PenFed Auto - 21K, I just refinanced with them at a much lower interest rate so think my scores took a hit from the new loan.

Personal Loan: 3500$ owed

Student Loans: 15K owed, current

Collection Acct:

850$ for medical bill. Opened 2018.

All precious charged off accounts have been paid in full, which is what the personal loan was for. Not sure how they're affecting my scores but some were closed by myself, only 3 or 4 were charged off.

Oldest account: 6 years

Average age: 2 years, 4 months.

im turning 30 in 2022 and my goal is to have this really cleaned up by then, which is the end of 2022. I don't want to go into a new decade with lots of debt & poor credit. I'm in the middle right now and would be happy being back at 680-690 which would get me out of the fair credit box.

[jrwa81]

I think you're on the right track.  Sometimes rebuilds can go a lot slower than any of us would like.  I've been there myself and it's frustrating, but there is always light at the end of the tunnel.  One thing that I learned during my rebuild was that sometimes the only thing that can help is time.  Once you've done everything you can do on your end, sometimes you just have to be patient and wait.  You will see a definite improvement in your scores once you get your overall utilization down to around 10-15%.  Utilization makes up 30% of your score, so getting those credit card accounts paid way down will make a big difference in your scores.  Put your credit cards away somewhere so you won't be tempted to use them.  If you can't trust yourself not to use them, have someone you trust hold onto them for you. 

As far as the medical collection, I would contact the CA and see if they will settle and do PFD.  That way, you will be left with zero collections.

I think you're in a good place to start gardening right now.  The current age of your credit is only a little over 2 years, so that could be factoring into your lower scores at the moment, because it shows that you have limited credit experience.  Pay your current cards down and don't open any new credit accounts so that your current accounts can age, which in turn will increase the average age of your credit and earn you some more points from that.  This is going to take some discipline and self-control, but if you can remain committed to paying off your cards and not opening any new accounts for quite some time, you will get the results you are looking for.  When my husband and I were paying off our credit card debt (which we accumulated while my husband was out of work for several months recovering from a surgery), we stopped going out, cut out unncessary expenses, only allowed ourselves to order out once per week (with a $35 limit) on Friday nights, and worked as many hours as we could to pay off our debts.

[FireMedic1]

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@anik28 wrote:

@FireMedic1 

Nordstrom / 1800$ balance - 7K Limit

CareCredit / 800$ balance - 2K Limit

Credit One AMEX / 399$ balance - 700 Limit

Merrick Visa / 600$ balance - 700 Limit 

Cap One QS 1 / 175$ balance - 500 Limit

US Bank Secured / 100$ balance - 300 limit (just paid this down and hasn't reported yet. I think I'll gain some points)

Target Red Card - 150$ balance - 300 limit 

AMEX AU (1400 limit, 0 balance)

Loans:

PenFed Auto - 21K, I just refinanced with them at a much lower interest rate so think my scores took a hit from the new loan.

Personal Loan: 3500$ owed

Student Loans: 15K owed, current

Collection Acct:

850$ for medical bill. Opened 2018.

All previous charged off accounts have been paid in full, which is what the personal loan was for. Not sure how they're affecting my scores but some were closed by myself, only 3 or 4 were charged off.

Oldest account: 6 years

Average age: 2 years, 4 months.

im turning 30 in 2022 and my goal is to have this really cleaned up by then, which is the end of 2022. I don't want to go into a new decade with lots of debt & poor credit. I'm in the middle right now and would be happy being back at 680-690 which would get me out of the fair credit box.

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First thing that sticks out is all accounts have a balance. FICO doesnt care for that. First mark against you. FICO likes less than 50% reporting a balance. Lower the better.

Next is Merrick which is considered maxed out over 89% reporting. Pay this down first to 48% to begin with.

Then start attacking all the accounts and paying them down to where one only has a balance of less than 8% reporting.

Your util % is too high on some of the accounts. The overall (aggregate) %'s is hurting too.

Main goal is if you cant pay it. Dont charge it. Emergencies only for balances. What your paying in interest is $ you'll never see in your pocket. Its in the banks pocket.

Now. Whos the CA for the med bill? And what was the dates of the DoFD on the CO's. CO's rank under a BK in points loss. We'll figure this out. For now. No more using the cards. Pay them all down and get out of card debt. Then payoff the consolidation loan. It can be done. Just some discipline for now.

[FireMedic1]

Oops. You may be in "toy limit" land due to the CO's. Not knowing the amounts. Lenders see that and they dont want to lose $ in case it happens again. Time is on your side for now @anik28 . Just get outa debt.

[anik28]

@FireMedic1 I receive a yearly bonus and plan to pay almost all the credit cards off. Immediate goal is keeping everything current and paid. I know we've discussed this before, always appreciate your input.

I live in CA where cost of living is extremely high, honestly it's not possible for me to not use my credit at all - my goal is to find a realistic middle ground that keeps me out of debt, with manageable balances. For me, using 1 card and paying most of it off that month is the most realistic for my life. Sometimes I pay multiple times a month because of the low limits. I know that carrying these balances is keeping me in a holding pattern from score growth and overall financial wellness. Like I mentioned

I make about 90K a year and my rent is about 2300$ a month which is considered very cheap for where I'm living. I've cut a ton of expenses in 2021, no travel for the last 2 years; cheaper apt etc. I was in extremely bad shape 2-3 years ago so to be where I'm at currently is a huge improvement. Unfortunately not being able to travel or do things I love is a direct impact of my current credit situation- so that's motivating me.

[anik28]

@jrwa81thanks for the input! It truly is just about patience. Every time I feel like this I have to look back at my posts from 1 year, 2 years ago to see the drastic changes that have been made. I think looking at the approvals board is like the worst you can do when rebuilding, others success just fuels my impatience. It's extremely easy to mess up your credit almost in an instant but takes so many years to build it back and fix mistakes. My 20's have been full of them and just the past 3 years I've been responsible, I feel like a late bloomer but better late than never. It's also hard to be around people my age who are buying houses etc and I'm still in this circle of fixing my old mistakes, sigh. 

like I mentioned to firemedic, I receive a yearly bonus soon and plan to pay off pretty much every card. The personal loan has a high APR

but i know I'll be more motivated by having all the credit cards at 0.

for the collection, it's through Grant Mercantile Agency. They sent me a letter offering to pay off with no interest by 12/14 but didn't have the funds immediately to pay. I'm also worried they won't delete it and that it won't help me much. Thoughts?

[jrwa81]

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@anik28 wrote:

@jrwa81thanks for the input! It truly is just about patience. Every time I feel like this I have to look back at my posts from 1 year, 2 years ago to see the drastic changes that have been made. I think looking at the approvals board is like the worst you can do when rebuilding, others success just fuels my impatience. It's extremely easy to mess up your credit almost in an instant but takes so many years to build it back and fix mistakes. My 20's have been full of them and just the past 3 years I've been responsible, I feel like a late bloomer but better late than never. It's also hard to be around people my age who are buying houses etc and I'm still in this circle of fixing my old mistakes, sigh. 

like I mentioned to firemedic, I receive a yearly bonus soon and plan to pay off pretty much every card. The personal loan has a high APR

but i know I'll be more motivated by having all the credit cards at 0.

for the collection, it's through Grant Mercantile Agency. They sent me a letter offering to pay off with no interest by 12/14 but didn't have the funds immediately to pay. I'm also worried they won't delete it and that it won't help me much. Thoughts?

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I don't have any personal experience with that collection agency, but I DO know that a majority of these agenices will do PFD (pay for deletion).  These agencies pay pennies on the dollar for these debts and they don't make any money if they don't get paid, so most them will be willing to work with you.  I would see if they would be willing to accept 30% of the balance in exchange for deletion.  I was able to find an email address for them <mod edit: email address removed>, so I would send them an email (best to keep everything in writing so you have a paper trail) and ask if they will accept payment for 30% of the balance in exchange for deletion from your credit reports.  Also, don't admit that the debt is yours.  Just say that you were reviewing your credit reports and came across this collection account and need to have it removed, so would like to settle.  I think they will likely work with you.

[anik28]

@jrwa81 I've already tried to get them to settle for less; they also sent the medical record of ambulance transport to confirm it's mine. Basically my insurance covered everything but the transport, if I ever have to go to the hospital again I'm driving myself LOL.

if I don't settle it, it's going to be on my report until 2024, I do not want to wait that long for my report to be clean. I can give it a go again and see if they will work with me.