Starting Over & Hopeful

Discussion in 'Credit Talk' started by Hope, May 15, 2001.

  1. Hope

    Hope Well-Known Member

    I'm fresh from a dismissed Chp. 13 which narrowly averted a foreclosure on my house of 3 years. "My head is bloodied, but unbowed".

    I found this forum and am thrilled to be among "kindredd spirits" -- if I may call you all that.

    My story:

    1. Single Mom of 2.
    2. Eldest son mentally challenged and medical problems (which caused the bankruptcies. I'm also his legal guardian)
    3. Self-employed 5 years nows

    I learned yesterday that my credit score is 649 on Experian and 644 on Equifax. That's with 4 Publics showing -- a 9 year old Chpt 7 which will drop off in 10 months, 2 attempts at filing Chapter 13 in 2000 and 1999 (both dismissed recently) and a judgement. Three charge-offs (Progressive, which I dispute for $60, EXXON, which I ignorantly paid the collection agency instead of going back to the original creditor -- live and learn; and AT&T Cable.

    What's keeping my score from being in the 300's is my previous good credit (several personal loans "Paid as Agreed/never late" totally some $20,000, and that fact that I'm a homeowner (although no where on any of the online reports does it say so. Confusing, since both times they had me verify the date of the mortgage, before showing me the credit report.)

    My first venture back into the credit world.
    1) Negotiated my mortgage and arrears into the note starting June 2001 -- with Chase Mortgage.

    2) Couple of weeks ago I got a preapproved for Gold MasterCard from Capitol One. It was the frst offer I'd seen that didn't require me to state my income (always a touchy point when you're self-employed), so I grabbed for it. It came last week with a $200 limit. That's okay for now, I'll take it.

    My sub-prime mortgage is an atrocious 14% so I want to refinance in a year or 2 as soon as my scores come up.

    My only current debt is the mortgage in which I have about $100k equity. I had to sell my car in December to make one of the bankruptcy and mortgage payments and I'm scared to death to try for even a "note lot" car right now.

    I've got income and an insurance settlement (6-figures coming up in 3 months.

    My goal is to rebuild for myself and my kids. I guess I'm just looking for some hand-holding.

    Thanks everyone!
  2. LoFico

    LoFico Well-Known Member

    Hope, you'll be fine. If I can rebuild, anyone can. I've only been disputing and attempting to rebuild for aprox 6 months. I was credit dumb, young and terribly niave and therefore made some bad choices. My wife and I struggled many times when she was out of work having our three children. But somehow we always made ends meet. My reports look like swiss cheese. However, last months' round of disputes yielded my best results to date. I got one charge-off deleted from my friends at Experian. Two charge-offs deleted from Equifax and three off of Trans. All this after about two months of everything coming back "verified". You can imagine my elation. Maybe even better luck next month? My point in all of this is, it can be done with persiverance. Also it makes a great hobby! BEST OF LUCK
  3. NanaC

    NanaC Well-Known Member

    HI...Can I clarify? Your Chapter 13 is dismissed,not discharged?
  4. Hope

    Hope Well-Known Member

    Correct. I could never continuously make the bankruptcy payments until it was certified, so it was dismissed. Then I immediately refiled. Then dismissed again a year later.
  5. Cadillac408

    Cadillac408 Well-Known Member

    Touching story...

    The only thing I can add is to keep reading this board. There are some great people on here that can offer you great advice!

    Did I read correctly that you'll be received a settlement in the 6 figures???? If so, be wise with what you do with the money. Rebuilding your credit should be easy to do w/ this money. Just start off w/ some starter cards like Cap1 (which you have) and Providian. Charge, pay, charge, pay, etc. and keep the ball rolling. Don't EVER be late or over the limit and pay WAY more than the minimum.

    As far as a car is concerned, do what you have to do to get by. When you get your settlement, go out and buy (not finance) a car until you get your credit in better shape. Then when that happens, trade or sell that car and get an autoloan on a better car.

    Your mortgage is ludicrous! I read that I didn't think that a 14% apr on a mortgage was possible. You need to start rebuilding your credit ASAP so that you can refinance. I can't believe that they would stick someone w/ an apr like that! That is INSANE!

    I'm sure others will have more to add.

    Hang in are not alone!

    GEORGE Well-Known Member

    Re: Touching story...

    IF YOU PUT 50% should be able to get under 9% even with bad credit...maybe even 0%...
  7. Hope

    Hope Well-Known Member

    Re: Touching story...

    Thanks for offering advice everyone. Yes, the settlement will $100k for a class action medical malpractice suit which left my son needing a complete knee replacement (which they're also paying for this Summer).

    After doing extensive reading through posts here for the lat 2 days, I decided to hire Junum. I signed up with them this morning.

    Interesting, Chase bought my old sub prime mortgage lender last month and -- without my asking -- dropped my monthly payment by $200 -- the new coupon book came in the mail today! I'm afraid to ask them why!

    Anyone, reading carefully through all 3 of my credit reports, I noticed quite a few errors and superfluous info on there. (Experian has my addresses from more than 20 years ago when I was still a teen living with my parents. Fore sure I want those off, just as a principal!)

    I think I have a good shot at getting both the 2 DISMISSED (not discharged) BK 13's removed because I only filed to protect my home from foreclosure while I battled the malpractice suit -- basically I had only a couple of trade accounts which, thank the Lord, the creditors never reported. Case in point -- I'd mistakenly believed that my JCPenney account had been closed 3 years ago due to non-activity. It was $0 balance, paid on time and I didn't use it for a year.

    WRONG! When I got up the courage to pul my reports, there it was in all it's glory showing as OPEN/never late, monitored 77 months!

    Soooo, I dug out the only old statement I could find (thank goodness for Junk Drawers!), call them up, told them I'd misplaced my card. They ordered me a new one yesterday.

    The BK 7 falls off mar 2002, but maybe I won't have to wait so long. I hear courthouses seldom answer the validation requests?

    I'm hoping to go from 649 to low 700's by Sept 2001 or so when I'll have the settlement to put a decent downpayment on a car and get a decent interest rate. Wish me luck!!!

  8. mother2

    mother2 Well-Known Member

    Hang in there

    You will definately gain knowledge and much support from this board. We (if I may be so bold) welcome you to the family. ;o)

    On a side note...I would invest some of that money as well in addition to paying off debt. Good Luck!
  9. Hope

    Hope Well-Known Member

    Re: Hang in there

    Thanks mother2,

    I plan to invest MOST of the settlement, but for sure I've got to have a car soon (Nothing flashy. I prefer used, safe, midsize, late-model, but NOT brand new).

  10. lbrown59

    lbrown59 Well-Known Member

    Re: Touching story...

    A coulpe more ideas;
    1= try to get current home loan rate lowered.If you can do so it will save you time and closing cost.
    2-Invest as large a sum of the settlement as you can in a good long term investment earning a good rate of return!
  11. lbrown59

    lbrown59 Well-Known Member

    Re: Hang in there

    Caution she needs to be careful where AND how she invest!
  12. lbrown59

    lbrown59 Well-Known Member

    A dismissed BK shoulden't even be on a CR to begin with should it!
  13. lbrown59

    lbrown59 Well-Known Member

    Re: Hang in there

    Be careful where and how you invest it:
    Important word of advice-Do not let any one talk you into purchasing a life insurance policy as an investment!
  14. judyputy

    judyputy Well-Known Member

    Re: Hang in there


    Good luck, you will get valuable information from this board to start you way to a better credit history.

    Question. Instead of having to worry about car payments and interest rates, why not take $10,000 to $12,000 and buy a nice used car outright. No payments, no interest, no hassle. Just a suggestion.
  15. lbrown59

    lbrown59 Well-Known Member

    Re: Hang in there

    ========There may be a better way to buy a car and make money in the process!
  16. Hope

    Hope Well-Known Member

    Re: Hang in there

    Thanks all,

    I'm going to try my best to get the following done in the next 6 months:

    1) Get my mortgage lowered (even if I have to refinance) to under 9%.

    2) Get an increase on my CapOne MasterCard to $1,000.

    3) Get a Chase Gold VISA with a cl of roughly $5,000

    4) Start using my JCPenney card again (1st time in 3 years) and get my limit raised to $2,000 or so.

    5) Buy a car either by taking out a secured loan at my Credit Union using $10k or $12k of my settlement as collateral (Had 7 loans with them in the past 10 years--all paid as agreed/never late; interest is about 9.5% and they report it to all bureaus). Or by getting an outright auto loan. I feel a bank will do it with a decent downpayment. Hi "judyputy", I'm tempted to pay cash for a car, but it seems to me I could have my cake and eat it, too by getting even a secured loan for the car (can't help but improve my scores, don't you think?)

    All of the above depends on getting those 4 publics off my CR's. And raising my scores above the current 649.

    ABOUT THE DISMISSED BK'S, you're right "lbrown59". I don't think the 2 dismissed BK 13's should be on there either. The bureaus simply picked it up from the public records. So I'm hoping Junum can get them off.

    ABOUT THE JUDGEMENT, I think Junum can get that off, too, but I noticed that the collector periodically does a soft inquiry. Could they have the courts put the judgement back on? Is that what they're checking for?

    ABOUT INVESTING. I have a Schwab account. Used to have $20,000+ in it. But now I've rebuilt with a single $1,000 deposit. Bless Schwab, the balance had actually been $0 for 2+ years, but they didn't close it.

    So I'll be starting over investing into mutual funds. I also opened a Sharebuilder account 2 months ago and investing a meager $200 a month into DRIPs (all I can spare right now). But when the settlement comes I can up that amount to maybe $700 a month.

    Also plan to keep $8000 liquid in my Schwab money market or Credit Union share account.

    Thank God I already have the house and was able to save it, so I don't have to worry about raising downpayment money--that was hard enough the first time around!
  17. tom65432

    tom65432 Well-Known Member

    Re: Hang in there

    I'm curious about your Schwab account. I left them because they charged so many fees. It seemed like every week or two I was hit with new fees that ate up any profit I was making in the market. Have you had this problem? I ended up at Fidelity which is great about low fees.
  18. Hope

    Hope Well-Known Member

    Re: Hang in there

    Hi Tom,

    Can't say that I even remember. As I said, my balance had been at $0 for a couple years. Before that it was in the $10k-$20k range which I think was/is a cut-off for fees. So I never had to pay them.
  19. jshimmer

    jshimmer Well-Known Member

    Actually, yes. The BK is on your credit history because you FILED it, not because you COMPLETED it. The status will be updated to 'discharged' after five years of payments (for a CH 13).

    If it was a credit card (instead of a BK) that was active for a couple of years, and then it was closed, does that mean it shouldn't show up on a credit history? No difference.
  20. Hope

    Hope Well-Known Member

    Thanks for you insight. But I'm wondering, since none of my creditors lost money NOR were they paid late, (the judge rejected my 5-year payment plan and promptly dismissed each BK, so I continued to pay all 3 accounts according to original terms; I think I may have a case for having it removed.

    It only shows up on my CR because the bureaus automatically pull public records of filings each month or so.

    It seems to me, it would be somewhat similar to opening a charge account with say a $3,000 cl, then never using (or abusing) it for a year, then requesting it closed.

    By the way, I just got my combined 3-reports via Airborne today and none of them show my mortgage at all -- it's as though I don't have one! It turns out the original sub-prime lender (Advanta Mortgage) doesn't report unless requested. Ordinarily, that would be a bad thing.

    But since Chase bought them out and lowered my monthly payments by $200, it will show a mortgage as of June 1, 2001 -- when my first payment with them is due. The mortgage is $178k on a value of $275k--very respectable I think, so once Chase post (never late with them!) I'm hoping that will help my score considerably.

    Whaddaya think?


    P.S. No mention of the mortgage in the BK's either.

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