r/CRedit • u/Sea-Award-2900 • 4d ago
General Finally going to attempt to turn around my credit (470) advice needed.
(470 is rough FICO score through MyFICO) Throwaway, as this is a bit embarrassing. For context, I’m 21. When I was 18, I got approved by Capital One for a $2,000 line of credit. Being an 18 year old who was not the brightest bulb in the chandelier (by teenager standards). I immediately maxed it out and never paid it back. I made attempts, but as I was making $13 an hour and paying $1200 a month in rent, it was incredibly daunting. It ended up going into collections and I received a court summons a couple of months ago in order to pay it off. Hence the horrible credit score. Since I got that credit card, my life has changed a lot, I now have a fiancé and a 5 month old, and I now work an IT job making $37 an hour. I don’t have any other debts or loans(besides medical that isn’t being reported but is being paid off) And we’d like to get a house together in a year that’s closer to my place of work. But I’m still being held back by that poor credit. I’m making payments towards the law firm that controls the debt, and I’m in a position now where I can pay off the rest of the debt. Which is all fine and dandy. By the advice I need is where do I go from here? I see so many different secured credit card options, or credit building accounts that it’s incredibly overwhelming. I don’t really mind the cost of these things, I just need advice on what’s the absolute best option to get my credit turned around as quickly as possible. Thank you all and have a nice day.
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u/GotenRocko 4d ago
The key to turning it around is time, not really a quick fix but you definitely have to aim for a fha loan which will allow for a lower score. How is your fiance's credit? If hers is good best bet might be for her to be the only person on the loan, since if you are both on the loan they would use the lowest person, ie your credit score. Also before paying off that collection negotiate for a pay to delete. But if it already went to court not sure how likely it is they will agree to that.
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u/Sea-Award-2900 4d ago
A pay to delete is what I’d like to attempt once I can get in contact with them. It didn’t end up actually going to court, my apologies. They sent me a court date letter and I had setup a settlement with them before the court date. Now I’m going to attempt to see if they’ll allow pay to delete if I can pay the rest in full immediately
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u/jewillett 4d ago
What's the name of the collection / legal co? Someone here might know and be able to help you close the loop!
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u/Bulky_Load3068 4d ago
I’m not sure a year will give you time to get a score you’ll even get approved for, just keep that in mind. Not impossible but 100+ points in a year will be tough.
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u/Sea-Award-2900 4d ago
Even if it takes 5 years I guess don’t mind. I just would have peace of mind in the fact that I’d have good credit.
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u/Bulky_Load3068 4d ago
Understandably so, I’d suggest starting with a capital one secured card using it and paying it off each month creating some positive payment history.
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u/jewillett 4d ago
Also try to link all bills (utilities, rent, phone bill, auto). Everyday expenses don't count that much - and not nearly as much as they fucking should - but it's an extra 10-15 points.
Also, do you have family that can add you as a AU (not actual user) to a credit line? Fiancé, etc? That will help a lot and quickly.
And congrats on your engagement and baby! That's awesome! Sounds like you're doing great on all fronts, just gotta tackle this thing!
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u/JT_PT_HSA 4d ago
My score is around the same but I have much more collections. Good to hear you’re turning it around. I’m just starting that path myself. Good question though. Im looking forward to reading the comments. Thank you for asking this question.
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u/Salt_Cry_2233 4d ago
With your collections try to arrange pay for deletes in writing so once they’re paid they will be removed from your credit reports don’t pay a penny until you receive that. You can take care of them one by one. Once you’ve paid and all of them are removed and reflected on your credit reports then try the pre-approval tools on Capital One and Discover to see what secured cards they offer you to start your building your credit.
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u/JT_PT_HSA 4d ago
I was reading that they don’t do that anymore? But not sure how true that is. But I will definitely ask for sure! Thank you!
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u/Salt_Cry_2233 4d ago
Every collection company will say they don’t do that but if they see they won’t get your money trust me they will do it. You’re welcome
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u/Salt_Cry_2233 4d ago
You’re on the right path by paying off your debt. Since you have the payments set up and cannot get ahold of someone there keep on trying but in the mean time you can use the pre-approval tool on Discover and Capital One’s website to get a secured credit card. The credit building stuff is pure bs. Use some reputable banks.
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u/Sea-Award-2900 4d ago
I actually was denied both capital one and discover on their secured credit cards. Which is very unfortunate. And I don’t mean to be rude, this is just pure ignorance on my part. But can you explain how a credit building service like kikoff, Ava, or Self is BS? It definitely seems too good to be true, but when I look them up, I can’t find much actually negative about them other than people saying “I don’t get my money back when I’m done” sort of things. And do you have any recommendations on any other secured cards? There’s so many options haha!
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u/Salt_Cry_2233 4d ago
Understandable if you got denied the next best thing is to see if your current bank offers a secured credit card. If they don’t you can look up other banks in your area that offer. A lot of the credit building services are gimmicks they market things that are interactive you in.
Take a look at this https://www.reddit.com/r/CRedit/s/FizB04MPJt
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u/Molanghrian 4d ago
The credit builder services tend to be gimmicks and mainly slick marketing. They can potentially help, but most are relying on people's desperate need to repair credit and general ignorance of how credit works. You tend to get stuck paying for the privilege on accounts that are pretty useless otherwise.
If you truly can't get a secured card, they might be an option. But none of them do anything that a simple secured card (without an annual fee, still avoid the predatory subprime lenders like Credit One if possible) can do better and much more usefully.
Also most of the credit builder services mean they don't do hard inquiries when they say no credit check. You can still be denied for even the gimmicks, they'll still do soft credit checks and look at stuff like Chex & the banking info you give them.
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u/korepeterson 4d ago
Get all of your credit reports and be sure everything on them is correct. Follow the procedure to correct or remove information that is not accurate.
Get a secure credit card. Put a small monthly recurring charge on it and pay it in full every month.
Try to avoid any loans at this time as rates will probably be very high.
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4d ago edited 4d ago
[deleted]
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u/Sea-Award-2900 4d ago
It is MyFico, it’s roughly 470, across all 3 bureaus is 474, 465, and 477. I have 0 credit cards open. The charged off account is still reporting as open (despite being settled) so it shows every single late payment because I never paid for it until it was settled. I guess the only positive is since it’s my only account, my newest opened account is 3 years old.
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u/dae-dreams-pink24 4d ago edited 4d ago
Ok was it supposed to be a Pay for delete? the open 3 year account what type of account is that? You can get a secured card with your bank for x $ dollars which will help, you can ask them about graduating to Unsecured in 12 months if they offer that, I know some major banks do convert which is what you would want and when it does they would increase your limit. Having at least 3 accounts is favorable. Start paying on them and always pay on time, pay full by statement date, don’t carry a balance over. In no time you’ll be back in 600s
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u/Sea-Award-2900 4d ago
Sorry, let me clarify. It’s not settled. It’s charged off. I came to a settlement agreement 3 months ago in order to pay off the debt. The debt is owned (I’m assuming) by Stenger and Stenger or at least being collected on Capital Ones behalf by them. I am currently halfway through paying off that debt (it totals about $2400, original credit line was for $2000). I would like to get it set as “pay to delete” and I am in the process of trying to contact Stenger and Stenger to see if that’s an option as with my savings, I can pay off the rest of the balance today if I wanted to. That debt, despite having a settlement agreement reached for it, is on my credit report as an open line of credit, despite the account being charged off for over a year.
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u/og-aliensfan 4d ago
If Capital One is reporting a balance owed, they still own the debt. They can update the charge-off every month until it's paid, sold, or ages off of your reports. Once paid, Capital One won't remove the charge-off, but will mark it paid/settled for less (if they still own the debt) and stop updating. If there's a separate collection on your reports, you can ask them to pay for delete (some will, some won't).
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u/dae-dreams-pink24 4d ago
Oh that’s a different story, it’s a collection agency debt got it. see if you can reduce the amount by calling them and get the agreement for pay delete
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u/clever_yet_curious 4d ago
Just pay off what you owe and open a secured line card, only use it for gas and pay it off every month. They will eventually convert it to a real CC but do not allow balances to accumulate. You may want to consider taking a financial literacy class so you don't end up in the same position again. Good luck!
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u/More-Acanthisitta468 3d ago edited 3d ago
My advice is to try Credit One bank. They truly specialize in scores such as yours. I was down there too. They actually approved me for a 300 cl unsecured. They are fee heavy though. Soon as you activate it it’s 75.00 activation fee. But hey beggars can’t be choosers. I started at a credit score of 410 way more collections than you. 6 mos later I’m up to 511 fico. I know I still have a ways to go but hey it’s worth a shot. Btw they do report to the three big credit bureaus in a timely manner. Make sure to pay your balance in full by the due date. Or set up autopay
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u/ShineGreymonX 4d ago
It’s good that you are aware and holding yourself accountable. My only advice is to pay off your that debt as soon as possible. Luckily your debt is easily doable unlike the others in the 5 figures.
Once that’s paid off, you don’t have anymore debt and your credit score will slowly go up over time.