Kaylee asked in Business & FinanceCredit · 1 decade ago

Raising credit score?

i have the worst credit ever. i've never had a car or home loan. i have 2 credit cards that i stopped paying on & were charged off 3-5 years ago, but I still get letters from collection agencies for them, trying to get a settlement payment. i have other chargeoffs from catalog companies from about 4 years ago. I am just a screwup I guess & in my twenties, on my own, barely had enough to pay my bills and wasn't able to live within my means. Plus I have student loans (public & private) I will be paying off forever, and I still don't make enough. How can I get my score to where I will be able to get an apartment that requires good credit, a car loan within the next year, and continuously raise it so I can buy a house within the next 5?

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  • Anonymous
    1 decade ago
    Favorite Answer

    Kaylee,

    I bet you had a good time in college, but now you are becoming a young woman and realize their is a road ahead. Don't put down on yourself, everyone has credit problems at least once in their life. I have been there too.

    As you stated you are still getting letters from those darn creditors. The reason why is when you don't pay, the lender will sell your charge off to creditor for a percentage of the outstanding amount. The lender gets part of their money back and the creditor trys to collect on the debt. Now lets call him Creditor A. After about a year when he realizes you are not going to pay he will sell it to Creditor B and your phone starts ringing again and you start receiving letters in the mail. This process can go on for years.

    Now I will not lie to you. The student loans they seem like you can never get them paid off. But if you just continue to make the payments on them every month your score will increase. I will show you in a minute how to get them paid off. You will also need to go ahead and pay off those outstanding debts, but you don't necessary have to pay them in full. The resource below provides good information for getting out of debt and repairing your credit.

    Once you have those chargeoffs taken care of. You should then be ready to buy a house with that man or woman of your dreams (not sure where you stand and don't need to know). Once you get that house note going, you should get a home equity loan to pay off those student loans. You will get a tax credit on the interest of the home equity loan and trust me it will seem a lot easier to pay.

    I encourage you to push forward and look at the resource below for some great information.

    The Best of Luck!

    Source(s): http://www.your-credit-solution.com provides simple solutions for credit repair and getting out of debt.
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  • 1 decade ago

    Negatives will fall off your credit report 7-1/2 years from the date of first default. The older the debt, the less impact on your score.

    You need to pay all your bills on time. You will need at least a 24 month consistent, on time payment history before your score improves.

    Don't count on getting a car loan in the next year unless you are willing to pay outrageous interest. You would be better driving whatever you can afford to pay cash for and work on paying off those student loans.

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  • 1 decade ago

    Basically, the only way to raise your credit score and ge the things you want, is to demonstrate responsability to your creditors.

    All those debts you mentioned are still legitimate debts and they will stay on your credit report and effect your credit scores for good reason.

    Find ways to trim your expenses and/or boost your income. Then take that extra money and work with the collectors to settle those debts. Since they are older, you can probably talk them into writing off part of them.

    Before you pay 1 cent to a collector, make sure you have a written agreement in hand from them spelling out the terms of the offer you agreed to. If you don't have anything in writing, they can change the rules in the middle.

    It's a tough road, but it can be done. I regularly read this one blog site called Blogging Away Debt about this lady who was over $40k in the whole with debt, and is working to get out of debt. She's been at it about 2 years now and is now only $10k in debt. Very inspirational.

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  • 1 decade ago

    The easy answer is to make more money to pay off your debt as agreed.

    If you cannot afford your standard of living, you need to be responsible enough to suck it up and do something about it.

    Either you reduce your spending (shopping less or finding a cheaper apartment to live in), or find yourself a second job to pay for the bills. There is no easy way to raise your score without fulfilling your promise to pay. Even if you decide to pay, it may take at least 2 years to see significant increases in your score.

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  • 1 decade ago

    You can improve your credit score with knowledge, some time, some effort and not a lot of money. Start by learning the credit laws in the United States. The big one that will help you is that credit<!--bureaus must respond to disputes in a set amount of time or they have to remove disputed items from your credit report.

    http://best-loans.awardspace.com/creditscore.htm

    Get a copy of your credit report and go over it with a fine tooth comb. Find the inaccuracies; almost every credit report has them. Write letters to the credit bureaus, disputing the inaccurate-->items. If they can’t prove it’s correct or don’t respond in time, the items must be removed.

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  • Anonymous
    1 decade ago

    To raise credit score

    1. Always pay on time or ahead of time.

    2. maintain low balances on credit cards

    3.To boost your score: Don't charge anything for at least 60 days before applying for a loan

    4. keep your total potential debt to earnings load low - If you have a card with a $15000 credit line, you may ask them to reduce it to something more realistic, like $5000.

    5. You should have a recent history of both installment or term (Car or house loans) and revolving credit.

    6.To boost your score: Don't close unused accounts when you transfer debt.

    7.To boost your score: Consider opening another credit-card account or two, or taking out a car loan or small bank loan.

    ------------------------------

    http://www.bestcreditrates.net

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  • First and foremost you need to pay of the collections. If you don't pay them your credit will never go up. If you clean all that up first then you continue to make ontime payments for the next year of two your credit will start to go up. You need to make sure you are not late on anything going forward.

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  • 1 decade ago

    HI, hang on now, there is hope.

    You'll need to contact all lenders/collectors-

    most are willing to work out a payment plan.

    They're happy to get any reasonable return.

    They can cut a deal with you: a compromise.

    It'll take time and persistence, but you CAN restore your financial health.

    Health and happiness to all -

    Source(s): off the top of my head - I was in debt. I paid - until I stopped all at once ( so my record was spotless prior) In an emergency: Hire an attorney. You can fill out your own forms -( I did, then asked a lawyer.) Low fee, worth it!
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  • Anonymous
    1 decade ago

    Yes you can.

    You can eleminate your bad credit score. In this way you can raise your credit score,

    http://credit-repair1.blogspot.com/

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  • Anonymous
    1 decade ago

    You won't be able to until you radically change your financial behavior. Then, it will be a long, slow process to reestablish good credit.

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