Will WAITING to rebuild help my score increase?

[Anonymous]

I know that sounds counterintuitive but hear me out. My rebuild kind of has two parts: 1) a massive student loan error that I’m working on resolving and 2) my other lates and collections.

My loan issue is 10 student loans defaulted and a year of 90+ day late payments that occurred in error. The other baddies are a few collections with Midland and PRA. All have been paid and I’m just waiting for them to fall. Two collections that report every month have already fallen. I also had a TON of late car payments removed from my file when I didn’t even ask.

None of these things that have been removed have added even a point to my score because my loan issue is so severe. I’m afraid that when the other 4 pending collections fall off in a week or two no points will come. I just think the 10 collection loans and a year worth of 90+ lates across 10 loans (130 late payments total) is so bad that nothing is going to improve my score until those are gone.

I know it’s too late to wait on the paid collections, but should I wait on any GW letters or doing anything else until the loan issue is fixed? I feel like losing two current collections and a ton of late payments on my car should have done something positive but that point increase didn’t happen so I feel like it was just a wasted opportunity to see my score increase.

[Anonymous]

You said that the student loan lates were an "error" which to me suggests that you're working on fixing that and that somehow your report will be cleaned of those dirty loan accounts.  Is that accurate and if so do you know when it will be fixed?

If those dirty loan accounts are indeed as good as clean and you're just waiting on that, there's no reason you can't start tackling your other baddies in the meantime. 

[Anonymous]

Yes, I’ve submitted ample proof and Navient has said over the phone that it is sufficient to get things fixed. It could take up to 45 days but it’s currently a “high priority” for their advocate’s office so I’m hoping that it will be a quick fix. Of course there is always the chance that they will drag their feet, kick the can, and do whatever to just be difficult! I know they aren’t the easiest company to work with so I am almost expecting them to drag this out.

I guess what I worry about is that the points from getting other junk cleaned up will just be lost. Like each thing has a value and if the loans are making it so the value of other baddies can’t be seen, do those potential points just disappear? Or is it sort of a collective picture?

[Anonymous]

I think most likely the only thing I am losing out on is seeing the points increase as negatives fall off, because my score is tied down by the loans. The points are there; just will take some time to uncover them, right?

[NRB525]

The thing about FICO scoring, one “thing”, either a well aged perfect payment account, or a single 30-day late, that first Thing of a category has the most impact. As you add more of the same Thing, the score impact is less.

With so many variations of “Late Payment “ on your file, you are not seeing the obvious benefits from clearing some from falling off. When the student loans are cleaned up, the other Lates will rise to the surface and removing them will boost score. Even removing the student loan lates won’t have a huge impact while the other Lates are still there, so it will be helpful, in the long run, to try to get ALL lates removed, at whatever pace each can be removed. Starting now.

[Anonymous]

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@Anonymous wrote:

I know it’s too late to wait on the paid collections, but should I wait on any GW letters or doing anything else until the loan issue is fixed?

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You specifically call out the question of whether you should get started on a GW letter campaign when your reports look (to an outside reviewer) so bad.  Given that your reports are going to get vastly better in as little as 45 days, I recommend putting the GW campaign on hold.

The overarching argument of a typical GW campaign is "I know there is this late on my reports, but I am not really like that."  I.e. you can see that I am truly a reliable person in all other respects.

But in fact your report as of today (the SL history) gives an outside observer the impression that you are a terrible risk.

Wait for a couple months when your reports look much better.  In the meantime make sure your CC debt is paid to a very low level (AZEO with a small positive balance on one card).  Then when you start your campaign will look like less of a mess.

I see no reason however not to pursue PFDs on the collections now, again for the same reason: if you can get some or all of the collections deleted prior to beginning the GW campaign, the GWP will be more likely to succeed.

[Anonymous]

Oh my gosh, these replies make so much sense. Thank you. Once these loans are fixed and my collections that I just PFD fall off, I will be able to see what I’m actually looking at needing fixed and can lean on this community to help me to figure out the next steps! A few positives are that all of my collections are/were held by companies that will PFD, and only two have original creditors on my report. One is Credit One bank, and it seems they are fairly decent at goodwill stuff. So once I’m ready for the goodwill part i’ll hopefully have good luck with them!

[Anonymous]

Oh! Another good thing is I’m already at 0 on two cards, and a third is at 9.06% currently and will be at 6% once the next payment posts! That card is actually a joint card that my ex ran up during our separation (I moved out 8.5 years ago) and he destroyed his credit so could never get it transferred or have my name removed even though it was only his responsibility per the court order. At one point it was at like 120% utilization. My ex has, despite all of his other financial issues, being $20k in additional CC debt and having a $17k balance from a repo, has paid this card diligently and on time, without fail. Literally this has taken him a whole second marriage and divorce to pay off. Thankfully he didn’t mess it up. And now I will get to be AZEO!