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Trying to Rebuild Credit!! HELP!!

Member

Trying to Rebuild Credit!! HELP!!

Hello all! My wife and I are in the process of trying to purchase a home but neither of our credit can get it! I pulled her credit report a few months ago and on Experian particularly she only has 3 accounts...THREE! But her fico is around 490...why is this?? She has a student loan that is in default from 2014, child support and a Navy Federal credit card that she is the authorized user on and is in good standings. Why is her score so low??

Message 1 of 11
10 REPLIES
Community Leader
Super Contributor

Re: Trying to Rebuild Credit!! HELP!!


Epierre17 wrote:
Hello all! My wife and I are in the process of trying to purchase a home but neither of our credit can get it! I pulled her credit report a few months ago and on Experian particularly she only has 3 accounts...THREE! But her fico is around 490...why is this?? She has a student loan that is in default from 2014, child support and a Navy Federal credit card that she is the authorized user on and is in good standings. Why is her score so low??


Its low because she has derogatory items and no positive accounts other than one AU account (whats the balance and limit on that account?). Get a couple of secured credit card opened, and a secured personal loan - $200-$500 is all you need to throw into these.

Most Recent FICO 8 Scores EX616/TU587/EQ607 01/09/2018 Starting scores 553/485/543 08/25//2017
~~~Credit lines~~~~
SDFCU VISA Secured $250
Discover Secured $200
Message 2 of 11
Senior Contributor

Re: Trying to Rebuild Credit!! HELP!!

Student loan in default could be hurting her for anywhere from 70 to 120 points by itself.

 

Child support is probably a public record and could likely hurt for an additionl 30-60 points on top of the student loan default.

 

That's 180 points right there.

 

Now, she only has 1 credit card, right?  That's probably hurting her for 20-30 points.  No positive payment history other than the AU also hurts.

 

Doesn't sound like you're in any shape to purchase a home right now.  If you dig in deep here on the forums and read, read, read and ask specific questions, I bet you can get a home in 2 years.  Maybe 3 if you aren't dedicated to it daily.

Message 3 of 11
Member

Re: Trying to Rebuild Credit!! HELP!!

The balance is $400 and the limit is $500. How much do you think a couple secured credit cards would help her score? Also, do you know of any good ones that she could be approved for with such a low score?
Message 4 of 11
Community Leader
Super Contributor

Re: Trying to Rebuild Credit!! HELP!!


ABCD2199 wrote:

Student loan in default could be hurting her for anywhere from 70 to 120 points by itself.

 

Child support is probably a public record and could likely hurt for an additionl 30-60 points on top of the student loan default.

 

That's 180 points right there.

 

Now, she only has 1 credit card, right?  That's probably hurting her for 20-30 points.  No positive payment history other than the AU also hurts.

 

Doesn't sound like you're in any shape to purchase a home right now.  If you dig in deep here on the forums and read, read, read and ask specific questions, I bet you can get a home in 2 years.  Maybe 3 if you aren't dedicated to it daily.


Yes, look at this as a two year long process at the very minimum. It took me just over two years to get where I could purchase my home - from ~500's to a 620 mid score.

Most Recent FICO 8 Scores EX616/TU587/EQ607 01/09/2018 Starting scores 553/485/543 08/25//2017
~~~Credit lines~~~~
SDFCU VISA Secured $250
Discover Secured $200
Message 5 of 11
Member

Re: Trying to Rebuild Credit!! HELP!!

Thanks so much for the info! We've already started rehab for her student loan so that should be out of default in 9 months. In the mean time, is there anything that can be done about the late payments on her loans or do we just have to sit and wait until the whole thing is taken out of default?
Message 6 of 11
Regular Contributor

Re: Trying to Rebuild Credit!! HELP!!

Adding that the balance of 400 out of 500 is very likely dropping her score as well. That is 80% utilization. I don’t know much about AU, so hoping someone else will chime in.






Starting Score: 10/1/2017

Fico8 EQ 591 TU 578 EX 598
Mortgage: EQ 616 TU 632 EX 590

Current Score: 2/1/2018
Fico 8: EQ 608 TU 669 EX 632
Mortgage: EQ 629 TU 657 EX 657


Goal Score:
700 Club


Take the myFICO Fitness Challenge
Message 7 of 11
New Contributor

Re: Trying to Rebuild Credit!! HELP!!

How is your credit history? Any old accounts in good standing? May be able to add her as an authorized user so she can get the same boost from those accounts.



Starting Score: 613EQ - 642TU - 613EX (01/13/2018)
Score Change:__39______4______36
Current Score:_652EQ - 638TU - 649EX (02/04/2018)
_______________ Goal Score: 700
__Take the myFICO Fitness Challenge
Message 8 of 11

Re: Trying to Rebuild Credit!! HELP!!

HOPE THIS HELPS!

 

Try applying for a secured CapitalOne Platinum or DiscoverIT card, and make sure you find out when your STATEMENT CLOSING DATE is and at least 3 days prior to that date you pay off your balance in full or make sure you only have 2%-10% but no more than 30% balance left. 

 

I am personally doing this and my credit score jumped fast and I've only started since September 2017, check my signature for my scores. 

I only have a CapitalONE Platinum UNSECURED card, starting limit was $300 and after 5 months they auto-increased it to $500. I was approved for this card using the CreditKarma approval odds link and my odds were "FAIR APPROVAL ODDS", I was suprised it was unsecured and my CK scores at the time (Sept 2017) were TU: 573 EQ: 554.

 

Also what might help to establish your personal credit and I'm currently doing it, which added about 20-25 points to my score within two months was I created a SELFLENDER account and signed up for the $550 option. It makes it so I'm paying a CD account $48.50 per month for a year for SELFLENDER to report to the credit bureaus that I am making installment payments (which I heard is a good to have at least one installment accounts on your credit history) for a year but at the end of the year you get to keep your $550. 

 

You can go the secured visa or selflender route if you have minimal deposit funds, or go with BOTH to establish your credit.

If you want to create a SELFLENDER account feel free to use my referral link: https://selflender.com/refer/15371009

 

If you haven't already, sign up for CreditKarma to keep track of your score progress, they aren't the true FICO scores however it will keep you on track to building your scores and seeing what your utilization and history looks like. Also sign up for DISCOVER CREDIT SCORECARD, I don't have a Discover card yet but the website still allows me to check my Experian FICO8 score for FREE, and updates monthly.

 

I also went to Experian's website and they had a deal for $9.99 to check my credit reports and FICO8 scores and reports from all three bereaus for the month, just make sure you cancel within 30-days (or it's $24.99/month) and you will still have access to those reports and your Experian score for the first 30-days.

 

I've done a lot of research and read a lot of opinions on building credit and it all seems to work out differently for different people. 

I personally decided not to go the AU (authorized user) method because I want to see how my journey will end up without the help, PLUS I've read through multiple sources that the AU/piggybacking method is starting to not work anymore because lenders are catching on. 

 

*Disclaimer, this is all my opinion and personal experience. I am not an advisor or credit expert.

Starting Score: 09/07/17 FICO8 EX : 537 // CREDITKARMA TU: 573 | EQ: 554
Current Score: 02/22/18 FICO8 EX : 628 | TU: 746 | EQ: 746 // CREDITKARMA TU: 726 | EQ: 700 // FICO SCORE 2: 670 - FICO AUTO LENDING SCORE: 646 - FICO BANKCARD SCORE 2: 691
2018 Goal Score: 740+


Message 9 of 11
Member

Re: Trying to Rebuild Credit!! HELP!!

So your scores jumped that much that quickly just from a secured credit card and Self Lender?? I just applied for a secured Capital One card two days ago and just paid the deposit, so that card should be coming in a week or two...I'll use the link you provided and look into the Self Lender thing. Thanks so much!
Message 10 of 11