Hello all **Warning: long read, no direct questions, just needed to vent and need some guidance I must first thank everyone for their help and contribution to this website and forum. I joined this site in Aug of 2008 and as a good newbie, before posting and asking questions, I first read as much as I could (and actually used the search button) and have been able to resolve several issues on my credit report. I must say there is truly a wealth of knowledge on this forum and it has helped me treamendously. Thanks again! So now I am ready for my first post to ask questions, if anyone can please assist, I would greatly appreciate it. Here is my situation: I went from about 20 derogatory accounts to roughly 8, which out of those 8 4 have been resolved but they are still showing as balance owed, which I am working to resolve. the other 4 are legitimate which I am working to resolve. I thought my credit score would increase which according to True Credit by Transunion I thought it did! Well I went to apply for a home morgage and was told my credit score was 480 using transuion, which true credit by transunion shows 650! by reading and searching I realize there are different methods for calculating credit scores and most companies use FICO, and possibly Transunion uses something different, but why would they be so different if they are both by Transunion? Well that is just one battle, after paying off alot of these accounts, and having them removed from my credit report I thought my credit score would increase at least 50-100 points, if it is 480 then that means that it has not increased at all within the last 2 years even after I have satisified several accounts and had them removed from my credit report. (never had a repo, bankruptcy, judgement, just small accounts like CCs) After almost 2 solid years of attempting to bring up my credit score it appears that I haven't made any progress, at this point I almost want to give up this battle! I really don't have a direct question, if anyone can provide guidance or even reassurance at this point it would be much appreciated. Sorry for the long read, I warned ya! - Joe
It sounds like you were in a pretty deep hole so you should feel good about how far you've gotten. The sad fact is that some derogatories (e.g. A BK or serious collection) count for a lot. Two of them count for a whole lot. You don't say what sort of positive tradelines you have, but they will help pull up your score. Ideally you want your report to be full of loans and credit cards that have a long history of on-time payments and no derrogatory entires. Getting rid of the derrogs as you have done is good, but only part of the puzzle. You also need to build a positive history which can take some time. From what you describe, I would expect it to take a couple of years of positive credit (a few accounts that show on-time payments for their entire life) before you'd have some FICOs in the 600-700 range. If you're in a hurry, you might also look into buying some AU tradelines. I don't recommend it, personally, but I've heard how they can help give your report a boost. Given the severity of your derrogatory entries, however, it might still be a while before they can help you out.
Joe, Truecredit is a consumer credit report by trans Union but if you read the fine print they use a very different scoring model. First off. If you do not have any open accounts, your scores are not going to improve. We are only rated on what is open and active not on what is closed and even if you do pay a collection often times it will actually bring your score down not up. This is because collections are rated based on the age of the collection and the age of a collection is based on the last paymenht date. So to give an example say you had a 3 year old unpaid collection and you pay it. Well you just paid it so now it's no longer a 3 year old unpaid collection rather a brand new paid collection. The scoring models are not formulated using common sense, so you need to know how credit works in order to repair your credit properly. Removing neggative items only addresses 35% of your score. Well what about the 65% that has nothing to do with your payment history? You need to think of credit in terms of possitive points and neggative points. You do not start out with an 850 and get docked points for derogs, you start out with no scores and either earn possitive points or neggative points. From your score I'm guessing you have little to no open credit. Let me know if you want help. This is what I do for a living.
Keep focused and stick with your goal, you will get there!! Jokah, I have been on this forum for quite a while now. I have gotten VERY helpful advise, lots of support from the community, and have diligently worked on improving my scores. When I started, my credit report was pretty much criminal. I had 30+ derogs, tons of charge offs, lots of collections, tons of inquiries, it was a total mess... The bad news is that it takes freakin forever to improve your scores above 650, you can get there pretty quick, but then from there is significantly slows down. The good news is, once you get about 650, and you put in all the effort to get there, most individuals are going to make a huge effort to stay there, based on all the work you put in over the years. I was in the same shoes as you, it is TOTALLY depressing being denied for something as silly as a department store card, and it is truly demeaning when you cannot even get a car loan under 15%, but all the work is worth the effort in the long run, when you are living in a nice home, at a nice interest rate, with a nice car, and a fair financing deal. I HATE the credit bureaus, always will, they have way too much power, they are WAY too easy to wreck, and far too difficult to fix. Having pushed the burden of proof on us just makes it that much more difficult to be a model citizen. Good Luck!!
Thank you for taking the time to reply and answering my questions. CCBOB: Thank you for the advice and quick reply. About the Authorized User (AU) tradelines, I did some searching online to get more information regarding this. After weeding through all the online advertisements that seem to be AU tradline scams, I have concluded the following: If you are added as an authorized user on a tradeline in good standing, that you are able to increase your credit score? (I realize if this is true, it would depend on several variables: i.e. high limit with low balance, long history with good payment history, etc) Idealy, you would want to be added to someone you trust, i.e. a family member or close friend. If you will, would you please confirm this. The information online was not conclusive, some sights were saying that it could possibly be considered fraud. Also, you are correct, I do not currently have any lines of credit open. (I have since opened a CC with several fees just to have something positive on my CR) I have in the past, but currently use cash for all of my purchases. As I quickly realized, once you ruin your credit, its extremely difficult to get another loan, especially one with a reasonable rate or no fees. CreditRepG: Thank you for your thorough explanation. I focused so much time trying to fix all my negative items on my credit report that I neglected any attempt to improve my credit history. I had my mindset on not opening up any CC or getting high interest loans if I did not need them. Financially it sounded perfect, but from a credit history stand point, it was a huge mistake! I have since gave in and opened a CC with fees, and I will soon open a secured loan through a local Federal Credit Union. Any other recommendation are appreciated. What are your thoughts on the AU tradelines? Bladzalot: Thank you for the positive reinforcement, I really needed that. I am only 26, but in that short time I managed to really dig myself into a deep hole. I am slowly trying to get out but as everyone has expressed, it will take time. Although I have spent alot of time and money trying to resolve these accounts, I have done little to build my credit history back up. Again, a heartfelt thank you to everyone who replies and provides feedback. Not just to my post but all posts as well. I have read several other posts and have been able to answer some of my own questions by searching. This forum is truly a blessing Thank you CCBOB, CreditRepG and Bladzalot for your replies!
