Ok, to summarize... I am 23 yrs old and graduated from college almost a year ago. While in college I was negligent with my credit cards and racked up high balances and several late payments, some severely late. Immediately after graduation, I payed off all my credit card debt and cancelled the cards so that my only debt is my student loans. I work as an engineer and make about $45,000/yr with my only monthly expenses being rent and student loans. (About $1000/mo). I recently checked my credit score from all 3 bureaus and they were all in the 590s. I know this is not good! What can I do to help my situation?? I have a good job, make decent money, have no current bad debt, I make all payments on time, yet I'm afraid to go buy a car because I don't want to be turned down. I have recently opened $1500 in credit to establish a good payment history. I know I screwed up in college but how ling do I have to pay for it???
In closing all your credit cards you put yourself into the category of not only those that are late on payments, but to which others are not extending credit, and you appear to have little history other than the close accounts with negative reporting. Lenders are lemmings, and rationally so. You have already opened one account, and you might also consider a credit union CC account or maybe a gas card to get restarted. Gradually open new credit accounts, maybe one every 6 months, selectively based on the potential for expanding your business relationship with the lender. Since you have already opened one new account, avoid the CC companies that cater only to sub-prime consumers and charge a bunch of fees. Once you start having a new history of several years of paid on time accounts, it should be easier to get better terms or offers. It may take a couple years to get back to decent terms.
Ok, well let me ask you this... How much can salary make up for credit? In about 15 months, my fiancee and I will have a combined salary of about $160,000 with our only debt being student loans. Will a bank still be hesitant to offer us a auto or home loan based on credit mistakes made in college?
If the account you opened, the 1500.00, is less than 6 months old its not helping your credit. You are basically in a sit and wait game. Make a large down payment on your car is about the best way to go about it, or you'll end up with a high interest rate somewhere about 12-15%. All your accounts are paid, are they showing paid on your CRs? Those accounts that show late payments will report that way for about 7 years.
My CRs show they are paid, however all the late payments are still on the report. What confuses me is how the different credit bureaus report things differently. When I paid one account, Equifax shows that I payed account as agreed and showed on time payments for the last 8 months of the account. Experian however says" account settled for less than amount owed" and shows bad payment history until the month the account was closed...
Based on all your accounts reported to all the CRAs (one account reported to 3 CRAs counts as 3), what percentage of your tradelines are reporting accurately?
You can dispute the experian as paid in full if thats how it was paid. Either way it really wont help matters until you have rebuilt enough credit on your file.
It looks like only 2 or 3 out of 30. And thats counting everything on the report( student loans, consolidations, credit cards, etc) and all 3 bureaus
There is one other thing you can do at this point to aid in re-establishing new accounts. If your fiancee has good credit with several years of positive payment history, she could put you as an "authorized user" on one of her "paid as agreed" CC accounts with long history. (There is no reason to actually provide you a card.) Within a couple months, that data will start appearing on your reports and affecting your scores. Use that FICO boost to assist you in opening an account or two, which should start pulling up your scores by establishing good credit history in a year or so. Note that if her credit is NOT good, or she is not on top of her bills, this can backfire by reporting her NEGATIVE information on your reports.
Thanks to everyone for helping me out... I feel ingorant for even having to deal with this now. More suggestions are more than welcome!
If you want insane credit take 5000.00 for a secured mastercard or visa, pay on time for 12 months the bank will release the 5000 to you and let you keep your money.Do that for a few banks not all banks will do this but if they do it's a very quick way to build.You also want a variety of credit like revolving,installment auto etc to boost your score
