July 24, 2011 Finally taking my credit in hand. My goal is to purchase my own home in five years. I'd love any feedback on how I can best accomplish this. Thanks! Current Scores: Experian: 565 Equifax: 565 TransUnion: 634 I haven't got the foggiest idea why TransUnion is so much better. My Action Steps: 1. Reduce my Debt Ratio to less than 9% 2. Raise Credit Limit on my Visa to $5,000.00 3. Write Letters to have charge-offs removed - willing to pay to be removed if necessary 4. Automate loan and credit card payments so that keep all payments current 5. Obtain new installment loan with Chase healthAdvance when credit score reaches 670 6. Obtain secured MC for $3,000.00 Any other ideas? I currently have: One Visa with $1,850.00 credit limit (13% open credit) one 30 late (within last 6 months) One installment loan paid on time for the last 12 years ($9,000.00 yet to pay Four accounts in collections (hope to have these removed via letters) UPDATE: I have reduced my debt ratio to 85% and my credit score has risen to 634 on all 3 credit reports. Lexington Law has begun challenging my negative items. I've sent letters challenging the 2 inquiries.
Am also paying my installment loans 2x per month ($75 x 2) instead of once per month ($150) and will be paying and additional payment, so 13 "monthly" payments instead of 12. I understand I can save lots doing this.
It really looks like you've got a good plan to help you get back on track. Make sure you're comparing apples to apples when looking at credit scores though. Are these your FICO scores you list here, or some other generic credit bureau score? If your goal is to buy a house, make sure you're tracking FICO scores because that's what a home lender will review when you're ready to buy. I would also focus on getting that credit utilization down to under 10% as fast a possible. That will continue to have a huge effect on your credit scores, since your CU ratio counts for about 35% of your overall FICO score. Also, do you have a significant other or close relative who would be willing to add you as an AU on one of their oldest credit cards in good standing with a low CU ratio? That may help give your scores a much-needed quick boost so you can get approved for a better unsecured credit card with rewards instead of sticking with a secured credit card.
I agree with Josh, you could add your self as an authorized user to a friend or family member's credit card to give you a quick boost, so you could apply for a credit card that is not secured. The authorized user account must have perfect payment history and they must maintain a low balance (10% or less of the credit limit). Looks like your hard work is paying off. Keep up the good work. Thanks! Heather with BoostMyScore.NET
Thanks heather and joshua : ) These are the scores I've obtained through freecreditreport.com so I'm assuming they are my FICO scores. Is this not the case? And if not where can I obtain my FICO? I do not have anyone to add me as an authorized user. So that's not an option for me. And I'm paying down my revolving credit within the next two - three months. Any other ideas/tips?
Nope- they're not your FICO scores. The only place you can buy them is from myFico.com. Glad to hear you're paying down those balances over the next few months. That should have a big positive effect on your credit scores.
Most of the websites online that you can pull your credit from use their own credit scoring model that aren't not even close to what the banks use. You can also get your "real" fico score by having someone from a bank or credit repair company pull your credit. Thanks! Heather with BoostMyScore.NET
