Mar
My credit score is a 538.
I have 2 charge offs, 15 collections, 2 public records.
I have 2 things that are revolving- My car and student loans, but I just paid my car off (owed $6,000) and my student loans are within 6 months of being paid off.
I need my credit score to be around 600 so that I can qualify for a home loan.
Is it better to pay on delinquent, collections, or charge offs?
Answer:
Ok, here's the deal with your credit.
The negative accounts that are less than 2 years, are hurting your credit the most. So, I would prioritize the most recent collections first.
I would negotiate a pay to delete, which is a payment in exchange for removing them off your report. The good part is that the older the item, the better chance it will either stop reporting under the Fair Credit Reporting Act, or you can get it removed. I posted several links that explain how to do this in detail.
http://www.creditinfocenter.com/debt/set…
http://www.creditinfocenter.com/debt/neg…
http://www.creditinfocenter.com/debt/Can…
http://www.creditinfocenter.com/debt/Act…
http://www.creditinfocenter.com/debt/deb…
As for the accounts that's building credit, they're not considered "revolving". Revolving accounts are credit cards and lines of credit. Your auto and student loans are considered installment financing, which helps, but you'll need some revolving accounts by opening a secured credit card Secured credit cards are the easiest credit cards to get, mainly becuase a security deposit is placed upfront in order to establish a line of credit in the same amount. For example, if you deposit $250, your credit limit is $250, and so on. The deposit isn't used to pay for any of the purchsases on the card unless, it was charged off and sent to collections, so you would have to repay it just like a regular card either in full or minimum monthly payments. The deposit is sometimes linked to a savings account, so it earns interest while you're building credit, so the deposit isn't sitting there. You can think of this as building credit with a savings account. The more you deposit, the higher your limit, which is good for your score because it creates a cushion between the total debt you owe and the credit you have available. Also, by continuing to add to the deposit, you're also creating an emergency fund or a down payment at the same time. A good way of using the card is by making small purchases ($20/month max) and paying on time every month while adding to the deposit. Usually after a year or so, the card either converts or upgrades to a regular card, and most importantly, the deposit is given back, which you can place in a savings account as an emergency fund or use towards the down payment.
Another thing that you can do is enroll with PRBC. PRBC is America's Alternative Credit Bureau, providing a helpful service to the over 50 million people with limited or no credit history. If you pay your monthly bills on time, PRBC can help you build credit to qualify for a mortgage and better interest rates.On-time payments for the following bills are not reported to the traditional credit bureaus:
Rent
Cable
Phone
Daycare
Insurance
Electric
Natural Gas
Cell Phone
The only time your payments for these bills are reported to the other credit bureaus is if they're missing or late.With PRBC, your on-time payments count. You build credit for paying your bills on time, even if you have no credit history. PRBC has teamed up with Fair Issac, the creators of the FICO score to introduce the FICO expansion score which helps people build credit. Here's a link that explains more in detail:
http://www.fairisaac.com/fic/en/product-…
Hope this helps, good luck!
Answer:
Before yopu do anything dispute the entire report, some accounts simply dissapear if the creditor has no time or is not able to produce proof that you owe said amount, then negotiate the rest.
Answer:
What you pay off won't matter, pay off as much as you can to lower the balance of your collections accounts. Make sure you call to get a settlement amount in writing first (if you haven't already received one) Disputing the accounts will take at 30 days at the most to get a result and if all the accounts are verified, you'll have to pay them anyway. If you have any credit cards in good standing, try to get the limits increased.
Answer:
To find out specifically what you must do to raise your score, you can order your score report from all three national credit bureaus. In addition to your score
http://best-loans.awardspace.com/credits…
In order to improve your credit score, it's important to know where you stand currently. Despite all the media attention given to free credit reports–>you still have to pay to find out your credit score, the three-digit number ranging from 300 to 850 that is the key to your borrowing costs.