Tips for rebuilding my credit?

[Anonymous]

My credit score is 550. It was 450 a year ago I have been working on it. My current plan -
Work to get PFD, I have 4 collection accounts
Try an get my charge off deleted
I have 2 credit cards. Plan to use them at 10% then pay them to 1% before payment date.
I have a $1000 credit builder loan.

I have a limited credit file and my oldest credit card is 2 months old.

Any tips or advice would be appreciated! Not sure what else I can do.

With my CC and loan plan, and if I got my collections deleted an chargeoff deleted do you think I can get to a 650 in 6 months? I can give more detail of my report if you need to think this is possible.

[Anonymous]

Welcome! Time is your best friend right now. Take care of your accounts & let time do its thing... GL!

[Anonymous]

I think your best bet is to use just one of those 2 cards and let it report a small balance below 8.9% of the credit limit. You can alternate the cards each month, but while you are in this phase, it's important to keep things simple and not allow yourself to carry any debt whatsoever beyond that. With the sharebuilder loan, you should be in for some score improvement in a 6 months, but your past derrogs are going to drag that score down, less and less as they become older.

If you can get them to PFD, then great, but if not, I would let time do it's thing and focus on building some savings so that you can have the financial power to weather any storms that may come in the future so that your scores don't have to take a beating.

[pgtackle2003]

+1 to Hram13. As they mentioned the important part is to let ONE card report a balance below 8.9% not both. This optimizes the Fico scoring model. Having them both at zero will actually cause a negative impact on your score (I've tested this personally)

[FireMedic1]

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@Anonymous wrote:
My credit score is 550. It was 450 a year ago I have been working on it. My current plan -
Work to get PFD, I have 4 collection accounts
Try an get my charge off deleted
I have 2 credit cards. Plan to use them at 10% then pay them to 1% before payment date.
I have a $1000 credit builder loan.

I have a limited credit file and my oldest credit card is 2 months old.

Any tips or advice would be appreciated! Not sure what else I can do.

With my CC and loan plan, and if I got my collections deleted an chargeoff deleted do you think I can get to a 650 in 6 months? I can give more detail of my report if you need to think this is possible.

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If any of those collecton agency accounts are with Portfolio or Midland they will delete them from your reports. If all the collections are with who I listed and you pay them. Good chance with a collection free report. But time is whats needed on the 2 revolvers for now. Let them age another 6 months and go for 1 more card to hit the 3 cards and 1 installment for the FICO bonus score as I say. Then build from there till 700 comes into play. May take some time. But you'll get there like many of us had to do while rebuilding to get there.Good Luck!

[Anonymous]

Question for everyone. One credit card limit is 200. The other is 300. On the 200 limit I was going to spend 20 a month, and 30 a month on the one with a 300 limit. Is alternating cards every other month necessary? Or can I keep my total utilization at 10% and pay down to %1 before payment dates? Is there a difference?

[pgtackle2003]

There is no difference in which card you use. Alternating cards also makes no difference. You’ll maybe want to run one small charge every 6 months or so to make sure the card has activity and doesn’t get closed.

[Anonymous]

You want to stay under 8.9% on one card and the other needs to report 0 for maximum score boost potential. That means your $200 card should not report a balance of more than around $16 and the $300 limit card should not report a balance of more than $24. Period.

I suggested alternating so they don’t close you for lack of use

Make sure your cards are below those levels 2 days before the statement cuts, so set a reminder on your phone to remind you monthly 2 days before the statement cycle date to check your balances. That way you can make a payment if needed and still have time for that payment to post before the balance is reported to the bureaus.

[FireMedic1]

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@Anonymous wrote:
Question for everyone. One credit card limit is 200. The other is 300. On the 200 limit I was going to spend 20 a month, and 30 a month on the one with a 300 limit. Is alternating cards every other month necessary? Or can I keep my total utilization at 10% and pay down to %1 before payment dates? Is there a difference?

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You can spend as much as you want on the cards. As long as 1 statement has 1-2% on one and PIF on the other. Its not a how much is spent percentage. Its how much is reported. If you want to use it more. Pay more during the month. All comes down to whats reported like I said on statment date day.