Lets do this

For just about anything you want to get off your chest about credit cards.
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Lets do this

Postby shizzo » Sat Dec 28, 2013 5:06 pm

Hi new to the board seeking for possible advice and thoughts

general background about myself:

25 y/o making 40k + / yr.
had a good credit run for a while but lost it all almost $30k or perhaps more mostly on Online Poker.
Havent been able to settle the debt ever since. Only to have it turnover to collections to get a bad rep on CR.
But with a new day rises a new hope, thinking perhaps I can capitalize from my mistakes, I want to start a new Credit & Spending habit and make my way the CR profile.
Score of 550 ( V Poor) acc/ to Credit Karma.

I was in the chexsystems only to able to get a bank account late last year and found and applied to have a secured card of $500 limit from the bank, which I didnt really care to pay off the balance fully till now when I found out that it hurts not to pay the balance in full.

I thought if using the card as much as possible and paying more than the minimum and keeping the card in good standing should be alright but to my knowledge I was wrong.

For 2014, I plan on applying for a Citi Secured Card as well as a Capital one Secured card. also, im planning on calling my current card company to see if they can process me from secured to unsecured line of credit if not I would just increase the amount by doubling the deposit.

Also, all my collections are getting charged off after a couple of years I don't what to do should I hold off till it gets off or should I try and pay off whatever I can.
Just don't want to have so much negativity on my Credit profile and want to up my score from 550 to at least 700+ range. :confused:

So fellow members please help.. thanks!!!

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Postby MemberSince99 » Sun Jan 05, 2014 11:22 am

I don't mean to judge you at all so please don't take this the wrong way. But you did say you can't pay your collections so I would assume you have collectors calling/writing you threatening to sue, etc. If you are hiding from them, applying for credit is going to tell them where to find you. If you don't care, great, it takes a while for them to get around to you, but expect after a couple of years to start getting served for suits.

I just wanted to point that out. I learned that lesson the hard way myself as I wanted to clean up my credit and did what you are trying to do now, and given I was hiding from the collectors, I just tipped them off where to find me. It didn't take long and I heard from them.

With that out of the way, yes you can start to rebuild your credit. The good will not outweigh the bad until the bad falls off your report, but once that happens then you'll see your score shoot up dramatically. That will take years so the best I would guess you could do score wise until then is low to mid 600s. At best. Eventually, we are talking years from now, you can get into the 700s, but don't expect that to happen anytime soon.

So if you are hiding out from your collectors, I would stop this now as you are telling them where you can be found. If you are just hoping to get lucky and they won't come after you with a lawsuit, it sounds like you have a LOT of debt and that makes it much more likely they will actually try to sue you to recover it, though the amount is not always a factor, just saying it makes it more likely because there is potentially a bigger reward for suing you (and collecting on it of course). So I wouldn't count on them just going away, it happened with some of my collectors, but others did actually come after me with lawsuits. You never know. And they resell the debt among themselves and if one won't sue, another one will. you just never really know for sure.

I'd worry more about that than trying to build my credit because your credit won't be great for a long time anyway, and once you put the debt behind you, you can build it again. Hopefully in the meantime you will have learned a lesson or gotten help fro the gambling. Not judging just trying to offer relevant advice.

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Postby takeshi » Mon Jan 06, 2014 9:16 am

shizzo wrote:I thought if using the card as much as possible and paying more than the minimum and keeping the card in good standing should be alright but to my knowledge I was wrong.

Minimums aren't relevant. Utilization is.

What do you mean by "I was wrong"? Did they take adverse action or are you just saying that your credit didn't improve? If you meant the latter then your derogs are probably holding you back and you need to look into dealing with those.

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Postby Obi-dan » Mon Jan 06, 2014 5:52 pm

First and foremost there is a moral component to this question that only you can answer. Do you wish to pay off all your debts or not?

In terms of straight finances the first thing you need to do is determine the statute of limitations according to the state you lived in when you acquired the debt. If the debts are getting close to falling outside that time frame (or they already have) you want to make sure you do not restart the time in which you can be sued with your actions in paying the debt or negotiating your debt. Your state's attorney general's website probably has information on this.

You state they are being close to being charged off, I'm not sure what you mean by this. Companies charge off debts but this does not relive you of them. This is also different from them falling off your credit report or falling outside the statute of limitations. None of the events make your debt go away. Technically your debts will always be out there. The negative impact just goes away over time.

Time and using new credit properly will heal your credit wounds.
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