Never seems to get better....

[Home4Me2012]

All I want to do is buy a house and no matter what I seem to do to fix my score things get worse. I tried to dispute accounts and most of the collection companies just updated the accounts with new dates, lowering my score even more. I am so afraid to even send any more letters out in fear that my score will go even lower. My husband's score is around the same area as my score (about 580) but we think it will raise here soon. He had a military star card with an almost $10,000 balance on it. They garnished our tax refund this year and paid about $7,000 of that off. We looked at filing bankruptcy, even paid $600 to the attorney (still need to pay $1400 to file). Hubby has about $43,000 in debt, $11,000 is student loans and $19,000 is what is left on our car (both couldn't/wouldn't be discharged in the bankruptcy). This amount doesn't reflect the $7,000 that was garnished from our refund. My debt is at about $25,000 and about $20,000 of that is student loans. So the more I think about it the more I feel bankruptcy really isn't worth it.

 

What can we do to improve our credit score? Trying to get the negative removed doesn't seem to work. We really don't want to get a credit card, so are there any other options? Would bankruptcy be a better option for us? We would pass the means test and be able to file a chapter 7. Oh and hubby qualifies for a VA loan, so we just need to get to a 620 credit score. However, I have a feeling there is more to it then that.

 

Thanks

Megan

[NEWSTARTIN2013]

Hello Megan, sorry that your having such a hard time, unfortunately credit repair is not easy if it was everyone would be doing it. I have no idea how long you have been on the forum but have you followed the initial steps of opting out, deleting old addresses? If not that should have been done before you started the dispute process.

 

If you did opt out and delete old addresses thats a good start, disputing directly with the CRA's should have been your next step. Depending on the SOL of the debts you need to send DV Letters. You can also dispute by using Section 609 this is done strictly with the CRA's google it or go on youtube and compose your own letter it works if done correctly.

 

Your credit repair will not happen overnight but if you stay focused, organized, persistant and open to learn from people on this board you will achieve your goal of home ownership. If taking the BK route is what you choose to do make sure you read the BK section of the forum but the ultimate decision will be yours and your husbands. Good Luck

[witty690]

First, if you could go into detail about the items on your credit report, w can you give you more specific information on how to attack them.

 

Second, I don't know the details of bankruptcy, but if most of youre debts can't be discharged, I don't believe that us your best option, especially if yoh want to buy a home in the next 3 or so years. Unless of course you could be sued got the dischargeable debts you owe, but again my BK knowledge is slim. And trying to get a few positive tradelines will but only improve your score, but make the mortgage process easier.

 

Lastly, remember it gets better. Stick to it and keep pushing forward and eventually things will start looking up. Best of luck to you going forward

[gogogophers]

Running the Ch. 7 BK scenario (and I'm not saying you should do it, I'm just looking at the key points) you would have these options:

 

Lease a new vehicle prior to filing - adds a positive tradeline to your reports, favorably impacts your BK expense schedule, and lets you surrender the existing car in exchange for a discharge from the remaining $19k debt. Probably reduces your auto maintenance costs for the next few years. I know you say you couldn't/wouldn't give up your current vehicle but it is probably worth taking a second look at this issue from a purely financial standpoint.

 

Discharge the $68k in the debt you've stated.

 

Retain the $31k in student loan debt.

 

Total debt is $118k, $87k (74%) discharged if car is not reaffirmed, $31k (26%) retained. $unknown cost for new lease if existing vehicle isn't reaffirmed.

 

With pre-filing black marks on reports, FICO often doesn't drop significantly with a BK filing. It may not hurt as much as anticipated. And it steadily goes back up with no risk that old debts will resurface and hurt your score when you start poking around for a home loan.

 

Fresh start. Immediately releases you from $87k in financial commitments and allows you to save money for a down payment on a home.

 

Again, I'm not here to push the BK scenario... but it doesn't seem to be a horribly bad option compared to the fresh start you gain. Best of luck in whatever you choose to do.

[phoenixisrising]

You received some excellent advice from Newstar, Witty and Gogogohers. You should consider the options further and discuss it with hubby. In the meantime, put your chin up,...you are in a funk but you will get out of it; you're just in realization of the situation at hand but I assure, there is lots of information and very good people here. Good Luck!

[Allisson0605]

Bravo Phoenix . Excellent advise.

[Home4Me2012]

Thank you everyone for the advice.

Running the Ch. 7 BK scenario (and I'm not saying you should do it, I'm just looking at the key points) you would have these options:

 

Lease a new vehicle prior to filing - adds a positive tradeline to your reports, favorably impacts your BK expense schedule, and lets you surrender the existing car in exchange for a discharge from the remaining $19k debt. Probably reduces your auto maintenance costs for the next few years. I know you say you couldn't/wouldn't give up your current vehicle but it is probably worth taking a second look at this issue from a purely financial standpoint. This is a brand new 2012 car that we got in January of 2012. It is also a Hybrid, so we save tons in gas and maintenance expenses.

 

Discharge the $68k in the debt you've stated.

 

Retain the $31k in student loan debt.

 

Total debt is $118k, $87k (74%) discharged if car is not reaffirmed, $31k (26%) retained. $unknown cost for new lease if existing vehicle isn't reaffirmed. I am curious - where did you get the $118K figure? Am I missing something?

 

With pre-filing black marks on reports, FICO often doesn't drop significantly with a BK filing. It may not hurt as much as anticipated. And it steadily goes back up with no risk that old debts will resurface and hurt your score when you start poking around for a home loan. This is my biggest fear. We have pretty good records of who we owe and can pay these debts off if we put our minds to it (and pocket book) and just take care of it. I am just afraid other stuff will poke up. But I am afraid this will happen after the bankruptcy too. =(

 

Fresh start. Immediately releases you from $87k in financial commitments and allows you to save money for a down payment on a home. Very True

 

Again, I'm not here to push the BK scenario... but it doesn't seem to be a horribly bad option compared to the fresh start you gain. Best of luck in whatever you choose to do.

 

Thank you so much. We keep putting bankruptcy off and then wish we had done it. But we have been in the mindset of "oh just put it in the bankruptcy file" and nothing has been taken care of. I am sick of being in limbo. But I don't feel bankruptcy is a good choice one day and then the next I wish we had done it.

[gogogophers]

The $118k came from this:

 

Hubby has about $43,000 in debt, $11,000 is student loans and $19,000 is what is left on our car (both couldn't/wouldn't be discharged in the bankruptcy). This amount doesn't reflect the $7,000 that was garnished from our refund. My debt is at about $25,000 and about $20,000 of that is student loans

 

Sorry, I misread the student loans as being separate amounts, not included in the $43k and $25k. Apologies.

[305_sigma]

It gets worst before it gets better and the fact that you feel the way you feel indicates that you are ready to get this weight off of you and your husband. I know exactly how you feel with just being tired but you really have to read some posts on here. I would strongly suggest starting with PsycDoc Transcripts as this was very useful for me. Also, take advantage of Whychat's website which is just as helpful. Take it one step at a time and the first step is opting out like NEW mentioned then removing old addresses. I had 8 old addresses recently removed from my EQ report and saw my fico increase from a 538 to a 570! I know it's not much but I felt a sense of victory knowing that the advice I took from the board worked. Put in about two hours twice a week to researching the wealth of information on this board and when you are ready attack attack attack.

[Home4Me2012]

Thanks,

 

I did the opting out and trying to get old addresses removed. That was about a year ago though, so I am going to try again. We started the DV process and following all the steps before but when the credit scores dropped down a good deal and more collections showed up we gave up and decided to do bankruptcy. But here we are a year later and still hadn't filed it.... we just didn't feel right about it. In the end we made the debt so we will pay it. But I am going to go through all the steps again and see where that leaves us.

 

It gets worst before it gets better and the fact that you feel the way you feel indicates that you are ready to get this weight off of you and your husband. I know exactly how you feel with just being tired but you really have to read some posts on here. I would strongly suggest starting with PsycDoc Transcripts as this was very useful for me. Also, take advantage of Whychat's website which is just as helpful. Take it one step at a time and the first step is opting out like NEW mentioned then removing old addresses. I had 8 old addresses recently removed from my EQ report and saw my fico increase from a 538 to a 570! I know it's not much but I felt a sense of victory knowing that the advice I took from the board worked. Put in about two hours twice a week to researching the wealth of information on this board and when you are ready attack attack attack.

[futurehomeowner?]

before I came to this board I was contemplating BK and really I found this board trying to figure out if I could file on my own because I didn't want to pay a lawyer. I am 2 months in and have made some progress but you have to be super patient because it all takes time. You have to figure it took quite a few years to make these debts so they are not going to go away instantly.

 

Take a look at my link in my sig and you can see everything that I have done in 2 months time.

[cv91915]

before I came to this board I was contemplating BK and really I found this board trying to figure out if I could file on my own because I didn't want to pay a lawyer. I am 2 months in and have made some progress but you have to be super patient because it all takes time. You have to figure it took quite a few years to make these debts so they are not going to go away instantly.

 

Take a look at my link in my sig and you can see everything that I have done in 2 months time.

My rule of thumb for resolving disasters that were forever in the making is that for every two units of time that it took to completely f^% something up, it takes at least one unit of time to fix it.

 

True to form, my credit became a moderate disaster after four years of neglect and willful ignorance, and it took about two years to fix it back up.

 

BTW, this ratio works also works for relationships, so if you get dumped after three blissful years, it'll take at least a year and a half before you are truly ready for the next future ex.

[futurehomeowner?]

lol at next future EX