How do I go about rebuilding my credit?

posted 3 years ago in Money
Post # 4
Member
11300 posts
Sugar Beekeeper
  • Wedding: August 2013

I’ve been here before. I feel you. 

Who owns these debts now? Is it the original creditor, a legit collections agency assigned to collecting the debt, or a junk debt buyer? They’re not that old, but they could have been written off and sold. 

Yes, you can get them to deal, and you need to get everything in writing. Write down the name of the person you spoke with, get a confirmation number, have them email or snail mail you a confirmation of a deal/payment plan. Have them agree to remove the negative entry from your report once the debt is paid, and make sure you get this in writing. Once you get that, get a money order for the payment amount and pay that exactly. If it’s a payment plan, pay the exact amount every month.

Unfortunately, rebuilding credit SUCKS and is very slow. Basically just keep paying things on time every month. Credit cards/revolving accounts, anything that shows trust in your ability to repay will be good, as long as you pay at least the minimum every month. Use very little of that credit, as well. Unfortunately, you likely won’t even qualify for a lot of things that could help you, because creditors want good scores (good score = you’re more likely to pay). Store cards and whatnot aren’t much help. Getting a secured card would be a good place. You apply, you send them say $300, and they give you a credit card with a $300 limit. Once you’ve made on time payments for x amount of time, you get your money back and now you have a credit card. I did this with Merrick Bank a few years ago and it’s been great.

Post # 5
Member
353 posts
Helper bee
  • Wedding: February 2013

My credit sucks from mistakes I made several years ago. My husband and I are trying to buy a house so of course I need to work on building my credit back up. Our realtor advised me to get a first premire credit card. Just go to their website and apply. My credit has gone up almost 30 points since getting this credit card a month and a half ago. Good luck!

Post # 7
Member
4576 posts
Honey bee
  • Wedding: September 2014

@busybride215:  They HAVE to tell you it’s more “beneficial” for you to pay the full amount. They get a commission off of it, so the more you give them, the better that rep makes out on his paycheck.

Your debt is minimal, and you should absolutely tell them you cannot afford the full balance, and you can only afford, say, $300. Trust me, they’ll take what they can get.

As far as the secured cards, just get one for now.

Post # 8
Member
11300 posts
Sugar Beekeeper
  • Wedding: August 2013

@busybride215:  Okay, is it one of these companies? I really suggest you start trawling the forums over on Credit Boards for more in-depth help. They give lots of great advice on what to say to the collections (or junk debt buyers), how to communicate with them, and how to clean up your report.

Post # 10
Member
233 posts
Helper bee
  • Wedding: October 2013

@busybride215:  Yup, call them up, they can cut you a deal. It takes some time, but you will get your credit fixed. I just bought a newly built house with a great fixed interest rate, so I know how important a good credit score is.

As far as a new card goes, it will help you, IF you pay it on time, all the time. You should pay above the monthly minimal too; that helps your debt/credit ratio.

You will definitely see improvements in 6 months…but just check your credit annually. Each time you or someone else checks your credit, your score goes down.

Good luck!

Post # 13
Member
4576 posts
Honey bee
  • Wedding: September 2014

@busybride215:  I had one medical bill that started out at like $1200 that I assumed was billed to my insurance. *A year later*, I get a call from a collections agency, saying they’ve been sending me statements for 6 months trying to collect, as insurance had not covered the full amount of the ER visit. When I had them verify the address, they had the location as “Venus” and not “Venice”, so I wasnt aware the bill even existed. At that point (a year later), they were willing to let me settle the charge for $425. So yeah, they’ll go lower.

Post # 15
Member
11300 posts
Sugar Beekeeper
  • Wedding: August 2013

@busybride215:  Yes. Personally? I’d probably tell them to fuck off. Force them into validating your debt before you give them a cent. They are neither the original creditor nor a collections agency assigned by the original creditor to collect the debt, and you have no legal obligation to pay them. Read that link on debt validating a couple of times through. Force these companies to validate the debts and then you’ll have two options:

– if they CANNOT validate, get it in writing that they will remove the entry from your credit report because they are NOT allowed to report it; doing so violates the Fair Credit Reporting Act and you can sue them for $1000 for each infraction (the mention of which usually causes them to agree to your terms and back down)

– if they CAN validate the debt, negotiate.

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