Good morning! I have been lurking the boards but am unable to find someone with a situation like mine. In May of 2011 I was able to finance two new vehicles. One loan on my own and the other with my husband....In July 2011 I was able to finance a used vehicle for my son. I have two store credit cards and two M/C's. Since making these purchases last year I have been ON TIME! I arranged auto-payments with all vehicles and the credit cards are either paid in full or I make more than the minimum payment due. All on time. I figured that after a year of doing this, my credit score would soar. However, I just checked and it is lower than ever (593). The highest it has been during this past year is 635. I had a bankruptcy in 2007 (ch. 7).....the accounts are still on there (about 12) that were included with the bankruptcy. I did the letters of dispute to the CB's last fall but not many changes were made to my credit reports and I saw no improvement. I don't know what more I can do. I understand that time can improve credit scores along with on-time payments....but in my case the time and on-time payments are proving detrimental. Any advise would be appreciated! Thank you.
There are so many variables in how credit scores improve and decline. Opening new accounts, can result in a decrease in scores, initially, as those accounts age, with a good payment history, the decrease should decrease, and the scores should improve. My best guess would be the number of new accounts are what is causing the biggest temporary hit.
Welcome to Creditnet! I can guarantee you that making your auto loan and credit card payments on time isn't what's hurting your FICO scores. You are referencing your FICO credit scores, right? I just want to make sure we're clear on that. First, what's your overall credit utilization ratio? You say you sometimes just make the minimum payment, so you must be carrying balances on some credit cards. Make sure you're credit utilization ratio is under 10% to maximize your FICO scores. Has your CU ratio perhaps increased recently? If so, that could be what's causing the recent drop. Also, depending upon where your FICO scores were to start with, it can take 7-10 years for your credit scores to fully recover from a BK. You may just need to give it more time, especially since you just started building positive payment history a year ago. Do all the old accounts on your credit reports now have a $0 balance and show that they were included in the BK?
Thank you so much for your responses! I cancelled out of freecreditreport.com and signed up with myFICO. According to myFICO my Experian score is 612 which makes me feel a little better. However, according to their site I am using 65% of my revolving credit. The score simulator showed that if I pay down the balances on the credit cards...my credit score will improve immensely so you are absolutely correct! Gotta get it down to 10%! So that is my plan!! I will keep you all posted!
Let us know the improvement with your credit score after you pay down your credit card balances to 10% of their credit limits. You can also improve your credit score by adding yourself as an authorized user to existing credit card accounts. Talk to a family member or a friend about it, just remember the cards must have a perfect payment history and they must be able to maintain a low balance (10% or less of the credit limit). Add a card that has a high credit limit and long payment history and you should see a good boost in your score. Thanks! Heather with BoostMyScore.NET
I had a feeling. Yea, focus on getting your CU ratio down to 10% and you should see a nice improvement. Keep us posted!
