First off my wife and me are new to your board and are looking for major help. We both have low 500 Scores . We Have about 7 Charged of accounts from being young and Stupid and a previous divorce for me we have alot of medical bills showing on credit reports. I just settled with 2 major creditors Sears for .50 cents on the dollard and Benificial for .55 cents on the dollard which all had to be paid with in 2.5 months. So we are paying out about 8,600 in 2.5 months all checks over the phone done in advance with each Company. They both said they would report as settled and paid wife has 3 good things reporting to credit our truck loand from our band and a sig loan from bank late 1 time 30 days in 2 years and a Capital One CC I only have the CC reporting to mine. We cant really dispute and of the depts cause we do owe them but we need to know how we can inprove our credit rating to like a 620 Plus in the next 6 Months for My wifes mother is selling a house worth 94k for 50k but bank said with our credit we would need to put down 50% and have a 13% plus interest rate we have our normal bills of about 2300.00 a month and make gross about 90k a year. We Can Pay off a Majority of the stuff with in the 6 months but will this really help us??? and is there any other insight you all can help us with on how to icrease our scores... thx Regreats Being Young and Stupid
Welcome to the board. Just to let you know, the CA telling you they're report the account as settled and/or paid is something they're required to do, so don't let them think they're doing you the favor, its you who's doing them the favor. Have you disputed the 1 time 30 day late? If not, I'd suggest you do so. Just 1 late will turn a positive account into a negative account. Unfortunately, simply paying off a collection or charged off account will not improve your score, however it would look better to a mortgage company when purchasing a home if they're paid (in fact, for the most part it's required that any charge-off or collecion account over I believe $250 to be paid off before they will approve you) What you need to do is settle with the CA's, but only in exchange for them deleting the collection accounts once you pay. Start off by offer 40% with deletion, if they say no deletion at 40%, raise it to 50%, etc. Whatever you do, you do not want "settled" on your credit report, nor do you want any notation pointing to a collection account or a paid or unpaid charge-off. I'm assuming from your above post you mean your mother in-law is selling the home to you and your wife. 50% is outrageous for a downpayment. And 13% interest rate?? In todays market? That sounds way off base. BTW, I should have mentioned this above: As far as the collection accounts and charge-offs go, are they still within the SOL (statute of limiation) period? I know you said the collections are reporting, but are the charge-offs reporting as well? As far as the collection accounts go, you could start off by requesting validation. Hopefully, the CA won't be able to validate and will simply delete the account from your report(s). If they can validate, and I mean really validate, then start negotiating. Hope this helps. Any other questions, just ask.
First off... you can dispute anything. NO matter if it is yours! That would be the first thing I would do! Second... I would no longer pay these companies if I wasn't going to have it changed to eigher a R1 status or for complete deletion on my CR. A settled account on a CR looks terriable and it doens't help your score at all! I would also make sure i got all of this in writing. They can come back later for the rest of the debt by giving it to a CA. What morgate company did you guys talk to? You should be able to get a FHA loan for 50K. FHA isn't score driven. Plus.. they allow you to pay off debt to get into a home (what you can't get removed by disputing) and they usually only require a 3-5% down payment. You really need to run a search on the board about home loans (fha), debt settlements, and etc. You will find a wealth of knowledge here that can help you guys get that home loan. Good luck.. if you have any questions please feel free to ask away!
I would not be so quick to jump ship as of yet. I was actually in a worse situation then yours because when I was younger I just didn't give a damn about my credit or anything else for that matter. Man have times changed. I cherish my credit now and would NEVER screw it up again. Like you I got married and my wife and I decided to buy a home. Well things didn't happen the way as planned and we have yet to buy our home. We for now continue to pay someone else's mortgage for $750.00 a month. We ended up going to a mortgage broker who ran both of our credit. My score was 410 and my wife's not much better at 560. His advice was not to pay these people off but rather to refer us to a credit repair guy he knew. My credit reports contained at least 17-20 negative account, mostly charge offs and collections. My wife's contained only 6 charge offs. Luckily all of mine with the exception of 4 were more then 5 years old and luckily past the statute of limitations in PA for suit should I awaken a sleeping dog and these creditors now try and sue me. Since my wifes credit was the easiest to safely restore and hopefully get us a good mortgage we started there. I contacted this guy who had good refrences and seemed to know alot about this credit repair thing. We paid him $400.00 to repair all of her credit which he said was a favor to the mortgage broker for referring us to him. He has made exceptional progress in only 3 months time. He has removed all of my wife's negative credit accounts with the exception of 2. He even managed to change an old GMAC car loan which my wife was late every month to PAID AS AGREED/NEVER LATE. Seeing the results come in the mail and actually reading them made me a bit amazed and curious as to how this whole credit repair thing works. I started to surf the net looking for everything and anything I could find on the subject. Websites such as this and others helped greatly. I also consulted with my attorney on the subject and learned how small claims works and the SOL in my state of PA. I figured what the heck, lets try it on mine. From the start I tried creditor and CA validation and disputes with the credit bureaus. I invested alot of my free time and alot of money on postage. I even went out and bought a filing cabinet, supplies and a new printer/fax/scanner which helped alot to do things correctly and keep excellent records of my correspondence with these people. Since 3 months have past since I started I have gotten rid of 85% of all my bad credit without paying 1 cent to the creditors or collection agencies. I am now working on getting rid of my newer negative accounts. I hope by the end of the year to have nearly perfect credit. I know it will take a long time but hey, bad credit didn't happen all at once so I can't expect it to disappear at the drop of a hat either. As for my wife's credit the credit repair guy seems to think by the end of the summer my wife will have perfect credit, enough to be picky at which company she wishes to select a mortgage with! From speaking to this guy myself he is amazed at how knowledgeable I've become on this subject. He says he's been doing it for 10+ years and didn't obtain the knowledge I've learned in such a quick amount of time. My advice is to not give up, my credit was worse then your and I've made amazing progress I could have never dreamed of. Sit tight on this board as you will learn alot and about everything you'll need to know about restoring your credit. Good Luck! Tac
Also, on the check by phone...are they notifying you in writing five days before they are depositing the check? It is possible they have violated enough statutes whether the account is yours or not would be a moot point. Something to look into at any rate. Good luck! L
