What is my next move?

[Anonymous]

Hello!

I posted about my situation a couple months ago. I was doing fine until July when my mother-in-law died and we lost a large chunk of income from DSS. My scores tanked from upper-600s to low-400s when I became late on my car payments and credit cards. I sold my house in FL, moved my family of 7 to NY to be near family and established myself at my new job. After 3 months of searching, staying with family and even in a hotel, we were able to find a rental. This has allowed us to calm down and reduced the pressure to buy something. We have a year here.

I have met with a BK lawyer but was advised against filing due to our cash reserves. I have used the time since my last post to make more progress.

Here's what's been left to deal with:

Credit One Bank (charged off CC for $963 --> nothing but problems trying to discuss the account with them)

Ally Financial (repossession for $30,963 sold at auction with deficiency balance of $15,439 which has been charged off)

Chrysler Capital (repo for $28,972 sold at auction with deficiency balance of $13,110 which has been charged off)

Target (charged off CC $328)

Discover (charged off CC $2,116)

Bank of America (charged off CC $3,990)

Dick's Sporting Goods (charged off CC $514)

Medical Center Radiologists (med collection $320)

Emergency Physicians of Tidewater (med collection $636)

Emergency Physicians of Tidewater (med collection $656)

Student loans ($34,658 100% on time payment)

SEFCU secured CC ($500 limit, $30 balance with 100% on time payments)

CITI secured CC ($300 limit, $8 balance with 100% on time payments)

SEFCU secured loan ($500 loan with $380 balance and 100% on time payments)

As of this morning:
Equifax FICO 8 = 537 (+87)
Experian FICO 8 = 543 (+87)
TransUnion FICO 8 = 597 (+110)

So I have made some great progress with the scores but have a long way to go. Do you think I need a 3rd open/positive credit card or should I negotiate and pay something else off next?

Thank you for reading and guiding and helping.

- D and all of TeamFisher

[Anonymous]

Personally, if it were me, I would try my best to begin chipping away at charge-offs.  

[Anonymous]

Would you suggest going after the newest charge off first or hitting the smallest balances first to be able to deal with more of them?

[Anonymous]

I would attack the smaller ones first because you can likely resolve more of them in a shorter amount of time.  Others may differ in opinion and hopefully they will chime in with their rationale.  

[Anonymous]

Thanks!

[zachdwphoto]

We were in a similar boat 8 years ago when my dh's job closed down and we struggled with temp jobs and unemployment over the next 2 years. All of our cc's went into charge off as we could only afford to pay mortgage, car loan, and utilites. We wanted to avoid bk due to our personal beliefs so after getting on our feet we cashed out some of my dh's 401k and started negotiating pay offs with the charge offs and collections. We didn't have enough cash to pay everything in full. We negotiated many accounts for 50%-60% pay off (one account accepted 30% pay off to remove the balance) and those accounts were updated to $0 balance and while the neg history remained having them update to paid made his score begin to jump. I was surprised since they still showed as "paid charge off negotiated for less than full balance". Please be aware that any forgiveness in debt more than $600 will be reported to the IRS as income, so we had to pay some tax on those. The older these accounts became the less of an impact they had on his score. We were able to get approved for car loans and new unsecured credit cards once his score recovered to the mid 600's. Now 7 years after paying off those accounts they have all aged off. It's been a long hard road, and while rebuilding we couldn't let one open account report a late, but now we have come out the other side.

Good Luck with your rebuilding journey.

[Anonymous]

Thank you for sharing your story! We definitely have a long journey ahead of us.

[RobertEG]

A charge-off is the reporting that the consumer is considered unlikely to ever pay.

It is common for creditors to either assign debts for collection assistance to a debt collector after taking a CO, or to sell the debt in order to recover a bit more of the expected total loss.

I would focus first on those charged-off accounts that currently do not show a reported collection, thus preventing the addition of a collection.

Another primary factor is the age of the delinquency as compared to your state statute of limitations.

Until the SOL has expired, there is always the chance that they will bring civil action, and possibly obtain a judgment.

A third primary factor is the potential to obtain a pay for deletion.

If the creditor still owns the debt and no collection is reporting, you may be able to obtain a pay for deletion agreement with the original credtor, and thus remove the charge-off.

[Anonymous]

Hello! We have made a little more progress!

Credit One Bank (deleted!)

Ally Financial (repo with deficiency balance of $15,439 which has been charged off)

Chrysler Capital (repo with deficiency balance of $13,110 which has been charged off)

Target (paid charge off, waiting for CR update)

Discover (charged off CC $2,116)

Bank of America (charged off CC $3,990)

Dick's Sporting Goods (charged off CC $514)

Medical Center Radiologists (med collection $320)

Emergency Physicians of Tidewater (med collection $636)

Emergency Physicians of Tidewater (med collection $656)

Student loans ($34,658 with 100% on time payment)

SEFCU secured CC ($500 limit, $45 balance with 100% on time payments)

CITI secured CC ($300 limit, $8 balance with 100% on time payments)

SEFCU secured loan ($500 loan with $246 balance and 100% on time payments)

As of May 24:
Equifax FICO 8 = 505 (-32)
Experian FICO 8 = 566 (+19)
TransUnion FICO 8 = 590 (-7)

I am not sure why the score is going down with Equifax and TransUnion? Our next plan is to settle the Dick's Sporting Goods account.

Thank you for reading and guiding and helping.

- D and all of TeamFisher

[Anonymous]

Im guessing here alittle, but I'm thinking when they deleted you Credit ONe TL that its age going away would be the reason.  like i said without knowing all your file, it the best guesstimate