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Charge off/ utilization ? advice

Mdg1307
Established Member

Charge off/ utilization ? advice

So I'm currently working to rebuild my credit. I've managed to PFD all my collections and PFD 2 chargeoffs. 
I still have 6 charge offs, I'm trying to negotiate PFD, however it's seeming unlikely. 
due to these my utilization is 101%. How much of a score increase can I expect by paying all these off to zero?

All baddies are ~4 years old .

scores are 550-560

only open account is an amex optima that I pay down to between 0-10% utilization monthly.

 

also once paid off is it possible to get good cards/ mortgage etc...while the old paid charge offs are still on my report?

 

 

Message 1 of 12
11 REPLIES 11
FireMedic1
Super Contributor

Re: Charge off/ utilization ? advice

One charge off card is like having an open maxed out or over the limit card even though its closed. So its hammering your util %. Once they are all paid or settled. They will have to report a $0 balance. Then it will no longer affect your util. But the CO in itself will still ding you till its gone. Its hard to pinpoint an exact point gain. Average around here is 20-40pts +/-.





My posts are JMHO. My siggy is not to brag at all. Just sharing my experiences after learning here from rebuild to recovery after BK DC 540's. And to show fellow members what can be accomplished when you do it right and play the FICO Credit Game.
Message 2 of 12
Mdg1307
Established Member

Re: Charge off/ utilization ? advice

Thank you Firemedic.
So it is possible to get FICO into the mid/upper 600's with the chargeoffs still reporting?I'm going to pay them all off now, seems to be the best option.

I've been trying to negotiate PFD's but the remaining ones seem very unlikely to do so. I was lucky enough that Amex and  a credit union deleted.

Message 3 of 12
Mdg1307
Established Member

Re: Charge off/ utilization ? advice

Ok, so today I paid off all my remaining chargeoffs (4) , once they report my utilization will drop from 101% to 3%.

 I'm hoping for a nice big score boost 🤞🏻

Message 4 of 12
sjt
Senior Contributor

Re: Charge off/ utilization ? advice

Are the charged off accounts still with the original creditor and do you know if they are reporting monthly?

American Express: Platinum Charge, Optima, Business Gold, Delta Business Platinum, Business Cash
Barclays: Arrival+ WEMC
Capital One: Savor WEMC, Venture VS
Chase: Freedom U VS, CSR VI
Citibank: AAdvantage Platinum WEMC
Elan/US Bank: Fidelity VS
Credit Union: Rewards Visa
FICO 08: (3.04.21) EX: 838 / EQ: 850 / TU: 848
Message 5 of 12
Mdg1307
Established Member

Re: Charge off/ utilization ? advice

Yes and yes. All were with original and continuing to update.

I have only one open account that I've been paying in full each month, however due these chargeoffs my utilization was 101%. 
I previously paid in full 7 accounts for deletion, however these last 4 wouldn't do PFD, so I settled these, in total paid 41k on 83k of debt for these 4.
feels great to have it all done, I'm just hoping for a good score increase now.

Message 6 of 12
sjt
Senior Contributor

Re: Charge off/ utilization ? advice

Once they are all settled or paid and it reports to 0 balance, you should see a really nice bump. After its paid you should get a couple more cards or try for another Amex once your Optima turns 1 year old.

American Express: Platinum Charge, Optima, Business Gold, Delta Business Platinum, Business Cash
Barclays: Arrival+ WEMC
Capital One: Savor WEMC, Venture VS
Chase: Freedom U VS, CSR VI
Citibank: AAdvantage Platinum WEMC
Elan/US Bank: Fidelity VS
Credit Union: Rewards Visa
FICO 08: (3.04.21) EX: 838 / EQ: 850 / TU: 848
Message 7 of 12
Mdg1307
Established Member

Re: Charge off/ utilization ? advice


@sjt wrote:

Once they are all settled or paid and it reports to 0 balance, you should see a really nice bump. After its paid you should get a couple more cards or try for another Amex once your Optima turns 1 year old.


Thanks.That's definitely what I'm hoping for, and yes my optima turns 1 year in august, I'm hoping this along with my spend and Payment history over the year with the optima will be enough to get Amex plat and gold

Message 8 of 12
Birdman7
Super Contributor

Re: Charge off/ utilization ? advice

Please update us on the magnitude of your score change.
-Scoring wisdom: Credit Scoring Primer, Payment History, Amount of Debt, Length of History/New Credit, Mix/Disputes/Freezes/Searches, Mortgage Scores/Negative Reason Codes/V.9, Helpful Links,
Anonymous’s Reason Statements Thread,
iv's friendly statement to reason statement concordance,

ccquest’s Workbook to calculate metrics.
Clean/Thick/Mature/No New Revolver - 8,9; Clean/Thick/Mature/No New Account - 5/4/2.
Correct Ag.Util. under 5% all times. (Oldest/avg varies. Estimates above.)
Real world mortgage maxes are: EQ5-818, TU4-839, EX2-844.




(Everything said is JMHO and is not endorsed by FICO or MF. I have no affiliation with either, just a grateful member.)
Message 9 of 12
Mdg1307
Established Member

Re: Charge off/ utilization ? advice

Ok so all of my payments to zero out the charge offs have now reported. Although all my reports are the same, the scores vary quit a bit w/ TransUnion being much lower than EQ and EXP.

old scores prior to payoffs:

EQ-581

TU-545

EXP-549

 

new scores after payoffs:

EQ-637

TU-613

EXP-645

Message 10 of 12
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