Advice for Next Steps

[PKenny]

So here is where I am at. I have been lurking CreditBoards since late last year and would love to see if anyone has any advice specific to my situation. My story is like many... didn't understand credit. Maxed out a card or two. Ignored student loans.

 

Dumb. Dumb. Dumb. I'd like to think I am a smidgen wiser now that I have been cruising these boards and I have become way more interested in credit than I would have ever expected a year ago. So heres where I am and some of the actions I have taken.

 

*Opted Out

*Disputed Old Addresses

*Send Cavalry dispute letter and they closed my one collection account

*Added as Authorized User on older card

*Got a secured card and added two additional revolving accounts.

*Kept utilization down.

*Settled Navient down from 8k to 2k and they agreed to report as "settled in full" in writing.

FICO

EQ 636

TU 653

EX 622

Here are the accounts... both good and bad... on my reports right now. The student loans in rehab *should* be new positive trade lines in September. Will these new trade lines retain the original loan dates? This was what I was informed... but I know that I shouldn't believe anything if it isn't in writing.

Positive Accounts

Revolving

Amazon Store Card - 900$ Limit - Opened April 2015 7% utilization.

Capital One Platinum (credit steps program) - 500$ limit. Opened March 2015 20% utilization.

Capital One Secured Card - 200$ limit. Opened Nov 2014 0% utilization.

CitiBank Authorized User Account - 7400$ limit. Opened Sept 2007 5% utilization.

Installment

Wells Fargo Auto Loan

11489$ Balance / Opened April 2014

Navient

$0 / Closed / Settled in Full

Negative Accounts

Revolving

HSBC negatives due to fall off 10/17

0$ Charge Off (Original Balance of $460)

Installment

American Student Assistance negatives due to fall off 7/16

$2,719 / Collection Account / In Rehab

Us Department Of Education negatives due to fall off 8/16

$3,869 / Collection Account / In Rehab

U S Department Of Education negatives due to fall off 6/16

$0 / Closed / Collection Account

Acs/College Loan Corp

$0 / Closed

Amer. Student Assistance

$4592 / Open / Collection Account / In Rehab

Inquiries

EQ 4 INQ

TU 15 INQ

EX 7 INQ

Other than the inquiries - which I know are less of an issue where i am at right now in the repair process - is there anything else I should act on immediately? Since HSBC was closed years ago and the CA dropped the account after I disputed the validity - is there anything I can do to help say goodbye to this negative mark? I tried disputing but it came back verified as sold... but still negative and charged off. I know for the negatives in rehab I should probably just ride out the next year for the bad stuff to fall off and enjoy my new positive trade lines come September. So... whats next?!

[tweak]

It sounds like you are doing the right things, and off to a great start!

 

Others can help with the student loan questions.

 

Don't apply for any new cards until Oct or Nov -- when all your new accounts have 6+ months of positive history.

Or possibly until your student loan rehab is complete -- if this will be soon after then.

 

Search for Cap1 HSBC to see if your account in the timeframe of the transfer between the two.

Some people have been able to get deletions based on faulty records transfers -- if this applies to you.

 

For best FICO results, pay all your cards to $0 each month BEFORE the statement cuts.

Except exactly one card, that you let report $2 each month (or <1%).

 

Can you control the AU card utilization at all?

Is this card from a spouse or SO?

If so, try to get it to report either $2 or $0 -- as part of the above utilization strategy.

If you can't control the AU card, just make all of your cards report $0 each month (so the AU card is the only one possibly reporting a balance).

 

After the Cap1 platinum is >60 days old, try for a CLI.

You could call the Cap1 EO (recommended).

Or try the online CLI button - which some have had success with lately.

After that, you can request a Cap1 CLI every 6 months (possibly more often).

I'm pretty sure this CLI is separate from, and in addition to, credit steps.

 

 

Set up all your accounts to autopay the minimum each month.

This is insurance against an accidental 30-day late.

But continue to pay in full manually (and the auto-pay will not kick in).

 

 

Good luck!

[PKenny]

Thanks for the quick response Tweak. 6 months after will be right around when the student loans become positive trade lines, so my report should hopefully feel a lot better by then... but from what I understand I will still have some derogs associated with the old student loan accounts until the drop off date in 2016... but at least these won't be considered collection accounts anymore?

 

I can control the utilization on the Citi if I am a good fiancé and pay down her balance to 2$. Is there something special about that 2$ number? If I keep these other cards at zero is there a chance that they will be closed due to lack of carrying a balance? I have read of this happening to some other users before. I would assume that is rare, correct?

 

The Cap1 is guaranteed to have a 250$ CLI after 6 months. I realize that is basically nothing at all on these boards, so hopefully when the six months hits I can negotiate that a bit...

 

Thanks for the advice. I appreciate it!

[tweak]

Thanks for the quick response Tweak. 6 months after will be right around when the student loans become positive trade lines, so my report should hopefully feel a lot better by then... but from what I understand I will still have some derogs associated with the old student loan accounts until the drop off date in 2016... but at least these won't be considered collection accounts anymore?

 

I can control the utilization on the Citi if I am a good fiancé and pay down her balance to 2$. Is there something special about that 2$ number? If I keep these other cards at zero is there a chance that they will be closed due to lack of carrying a balance? I have read of this happening to some other users before. I would assume that is rare, correct?

 

The Cap1 is guaranteed to have a 250$ CLI after 6 months. I realize that is basically nothing at all on these boards, so hopefully when the six months hits I can negotiate that a bit...

 

Thanks for the advice. I appreciate it!

 

I don't know anything about student loans -- hopefully others can help you there.

 

Try for a CLI with Cap1 after 60-75 days -- independent of credit steps.

Show some usage first, and PIF.

I got a Cap1 QS1 ($1000 starting line, credit steps) increased to $3000 after 74 days with the online CLI button.

I had only run about $250/month through the card.

Cap1 is being generous lately.

Most people here will recommend calling the EO number instead of the online CLI request.

 

This is what FICO wants to see:

- <1% utilization

- fewer than 50% of your cards reporting a balance

 

Check out the util tab in BobWang's spreadsheet.

 

The easiest way to accomplish this is to let exactly one card report a $2 balance.

Actually, let your fiance's Citi card report $0, and let one of your individual cards report $2.

It is unclear how FICO counts AU cards when doing the $2 trick -- so best for the AU card to report $0.

 

You can use all of your cards as much as you want.

All that matters is the statement balance each month they report to the CRAs.

I would use each of your cards occasionally - every 3 months at least - to show some activity.

 

Focus your spending on the Cap1 platinum.

Run regular expenses through it, pay in full multiple times per month (even weekly) if you want to use it a lot.

To be safe, never let the daily balance exceed 90% ($450) -- just pay in full if/when you approach that.

Make sure it reports $0 on the statement cut day every month.

Cap1 will let you pay online up to 110% of the current balance (so you can cover any small pending charges that haven't posted yet).

 

I don't know anything about store cards -- and can't remember who issues the Amazon store card.

Some store cards will not report without usage, but regardless don't buy anything you don't need.

With Amazon, you can buy $0.50 Amazon gift certificates for yourself to show usage if you want.

Edited April 28, 2015 by tweak

[Willis]

1% utilization on one card, preferably the highest credit limit, with the other cards all reporting 0$ will give a little score bump, maybe around 5-10 points

 

It's recommended to do 2$ Instead of another amount since some creditors round balances less than 2$ to 0% for utilization, and 2$ will round to some small amount of utilization. There's a graph in the master charts thread, it's stickied above.

 

And you'll definitely be fine paying your accounts down to 0$ before the statement cuts, the creditors know you used it. You keep a perfect payment history and in time you'll be golden. You need only one or two transactions a year on a card to make sure they don't close them for inactivity generally.