can someone give me insight help why is my score so bad Help?

[Joecooltech]

Ok, I need a little help understanding the following my Fico 8 score is 565 I defaulted on every cc you can think of during a divorce 3 yrs ago. I have 4 accounts that are in good standing but i also have collection 4 of them reporting every month.

MY CREDIT REPORT IS AS FOLLOWS

The Good

AUTO LOAN- opened April of 16 amount owed 6000 out of 10,500 

Wells Fargo- opened April of 16 dad is primary account holder Limit 8,600 Bal. 2300

Personal loan- opened January 17 amount 2000 owe 1200

Finger Hut- opened yesterday Limt 800

The bad  

Midland Funding- Opened 3 yrs 6 mo amount 1,170

Midland Funding- Opened 3 yrs 5 mo amount 835

Portfolio Recovery Opened 2 yrs 6 mo amount  731

Cavalry- Opened 3 yrs 2 mo amount 753

Each are updating every month any idea how to get my score out of the dumpster? 

Why is my score so bad with good utilization and almost 18 months of solid payments?

[Anonymous]

The folks in the Rebuilding forum can help you best.

http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/bd-p/rebuildingcredit

Note that the CC balances you classify as "Good" are in fact quite a bit too high.  They should be paid down a lot.  Best practice is to pay off all debt on your open cards and then keep one card reporting a small balance.  You can still use it a lot, but you need to keep the amount that it reports small.  Other folks can walk you through how to spend a lot on a card and still keep the reported balance small -- if how to do that is unclear.

The main thing killing your score is all your bad debts.  The fact that you have closed accounts that still have positive balances is hurting your utilization (they are counted too) as is the bare fact that you have some combination of lates, chargeoffs, and collections.  The folks at Rebuilding can help you develop a plan for getting all that removed, which will require money, perseverence, and time on your part.

Let me know if you'd like me to ask a moderator to move this thread to the rebuilding forum.

PS.  Another strategy you can discuss with the folks in that forum is to pay none of your bad debts, but just hope that the Statute of Limitations passes for each one.  Depending on where you live, that might as little as three years after the debt became delinquent (or it could be higher).  Then you'd want to wait till 7 years after the delinquency for each to fall off your report.  Such a strategy saves you money but it results in a longer time that the bad stuff stay on your reports and hurts your score.

[Joecooltech]

Took me a while to get back to you but I want to thank you for taking the time for such a lengthy response but informative

[Anonymous]

OP, one thing you really didn't get into with your post was why you only have 18 months of "solid payments."  Perhaps it's because your credit history is only that old, which is fine if so.  If the reason however is because prior to those 18 months you were exhibiting poor payment history, such as late payments on your accounts, that would be a huge (in fact the biggest) reason for your poor credit scores.  While fixing your utilization as recommended would certainly help, the presence of any negative items on your credit report will impact your scores adversely for 7 years, which is a lot longer than 18 months.

[Anonymous]

Too much missing information to really know what to suggest.

I would recommend getting 2 secured credit cards in your name, from prime banks.  Capital One? Discover?  Don't charge them up at all.  Keep your utilization to 0% except one card that shows $10 utilization.

Then start a savings account.  Stop going out for food, cancel cable, Netflix, Amazon Prime, etc.  Sell any luxuries you don't need to survive -- video games, etc.

Build a savings account for 18-24 months.  Get your 2 secured cards and show perfect payment history and no to low utilization.

Once you have 2 years of aging there, and some money in savings, you'll be in a better financial position AND your FICO08s will be a lot higher.

I had 550 FICO08s in March of this year, now I am 650-690 across the board and I expect to be into 700 by spring -- in less than 12 months.

[Anonymous]

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@Joecooltech wrote:
Took me a while to get back to you but I want to thank you for taking the time for such a lengthy response but informative

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Let me know if you would like me to ask a moderator to move this thread to the Rebuilding forum.

[Joecooltech]

That's what I'm struggling with at the moment I have money in the bank. Like to the tune of 500,000 due to the death of a family member. I making 30,000 just an interest but my credit score is terrible and I want to keep the principle of the money in the bank

[medicgrrl]

Pay down your credit card to a balance of less than 9%.

Midland has a policy that they will delete the tradelines from your credit report after payment if the DOFD with the original creditor is over 2 years ago. I would pay those collections.

Portfolio Recovery and Calvary, I would attempt a pay for delete on those collections.

Are the original creditor's still reporting derogatory accounts? Do you know what the date of first delinquency is? Have you pulled your credit reports from annualcreditreport.com? Where did you pull your score from?

[Joecooltech]

My scores were pulled from myfico no the original predators are not reporting date of the first delinquency has to be 4 maybe five years

[medicgrrl]

Ok, I would search Calvary and Portfolio to determine the best way to do a pay for delete and pay off the 2 Midland accounts. I would wait on adding new credit until you determine whether you can get those removed. Definitely pull those other reports I mentioned, they'll show you the DOFD for the collections.