Bad Credit :(:(:(

Discussion in 'Community Discussion' started by BrettFarve04, Jan 2, 2009.

  1. BrettFarve04 macrumors regular

    Joined:
    Sep 14, 2007
    Location:
    Milwaukee, WI
    #1
    So long story short....I was very irresponsible in the past...overdrew bank accounts a few unpaid electric bills...outstanding cell phone bills just to name a few. I wanna start to get my credit back on track...whats the first step???:confused::confused::confused::confused::(:(:(
     
  2. annk Administrator

    annk

    Staff Member

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    Apr 18, 2004
    Location:
    Somewhere over the rainbow
    #2
    Your bank probably has some sort of advisory service. If you contact them, tell them you want help to set up a plan to get things back on track, and ask to set up an appointment, chances are they'll be helpful. It's in their best interest, too, after all.

    Good luck. I know someone who did what you're about to do, and today, just a very few years later, he's back on track and with good credit. :)
     
  3. Sun Baked macrumors G5

    Sun Baked

    Joined:
    May 19, 2002
    #3
    People can live with bad credit and repair it, bounce a few checks and you might find the banks give you a cold shoulder.
     
  4. iGary Guest

    iGary

    Joined:
    May 26, 2004
    Location:
    Randy's House
    #4
    First off, pay off everything you owe if you have anything outstanding to the phone company, electric, etc.

    Second, don't pay late or kite checks again.

    Third, time and responsible payments are the only things that can "fix" what you've done.
     
  5. iAthena macrumors regular

    Joined:
    Jan 22, 2008
    Location:
    USA
    #5
    Time and never missing a payment will raise your score. Then you can get/use a debit card and your score will soon be up where you can get credit again.
     
  6. silbeej macrumors 6502a

    Joined:
    Feb 3, 2007
    #6
    Fix all the things wrong now, pay off bills, don't buy things you don't need, consolidate money to areas that need it. Once you are up to date on everything, start doing things that build credit, get a credit card, might need to be a pre paid one, or one with very low limit, but use it, pay in full every month. Work from here, those are the basic steps. But the key thing, don't fall behind on payments!!!
     
  7. Metatron macrumors 6502

    Metatron

    Joined:
    Jul 2, 2002
    #7
    Well, that depends on your time frame. I had to do it in a month to keep my...uhmmm...my job. I broke all the rules and called them, settled over the phone, and gave them my bank account info. We ultimately settled for half with the verbal agreement to remove the account from all three credit bureaus.

    I only recommend the approach I took if you must resolve the credit issues quick. I was fortunate and all the companies but one deleted thier items from my credit report. My score jumped 120 points in 8 weeks. I had settled 4 charged off credit cards and 8 medical bills. The one comany that did not take their item off my credit report I contested with the credit bureaus online. Two weeks later it was deleted as well. Truth be told, I was lucky. If you do take the quick route...talk polite and use respect. These people deal with hard liners everyday. After a few minutes, they will calm down and work with you. If you do not feel you are getting anywhere, hang up and call back and you will get another person.

    Assuming you have time, I suggest you get ready to write some letters.
    Before offering a settlement, ask them to verify the debt. They have 30 days to respond or you can sue them. It sucks to do all the work, but you will win. Should they respond, write them back with a settlement offer. Some will accept while others reject. Keep sending them offers on your terms. At some point they will accept, but only as long as they think you have the high ground. Keep all documents and copies of letters you send and do not give any personal contact information. Also, it may be a good idea to use a P.O. box. When you have agreed on an amount, send payment to them using a cashiers check.

    One last thing. Send everything certified, otherwise they will just toss it in the trash and never open it. If it is certified, there is a paper trail and they must reply. This is incase you do have to go to court.

    After this, do as other have suggested...pay everything on time, even early if possible. Get a credit card or two. Use them, but never go over 1/3 you credit limit per card. Pay it off in full every month. In a few months all will be well.

    Good luck!
     
  8. mattwrit macrumors member

    Joined:
    Dec 8, 2008
    #8
    Sorry, no sympathy. Credit ratings are there for a reason, so now you're just paying your dues (so we honest folk don't have to).
     
  9. nickspohn macrumors 68040

    nickspohn

    Joined:
    Jun 9, 2007
    #9
    But he wants to fix it now, so don't shun him.
     
  10. annk Administrator

    annk

    Staff Member

    Joined:
    Apr 18, 2004
    Location:
    Somewhere over the rainbow
    #10
    Yes, yes, but it IS possible to dig oneself out of a credit hole. It takes time and you have to pay your dues, as you say, but nothing the OP wrote gives you any reason to assume he's not interested in making up for what he's done. :rolleyes: Give him a break, he's asking for advice, not favors.
     
  11. NC MacGuy macrumors 603

    NC MacGuy

    Joined:
    Feb 9, 2005
    Location:
    The good side of the grass.
    #11
    A whole bunch of people do the same thing so don't feel you're alone. Many don't realize what that darn credit score can do to them until they mature a bit and get caught.

    You're on the right track by wanting to clear it up and the sooner the better. Pay off old debts. Keep current ones on term. The higher score will follow mature practices.
     
  12. ucfgrad93 macrumors P6

    ucfgrad93

    Joined:
    Aug 17, 2007
    Location:
    Colorado
    #12
    As others have said, pay off any overdue debt first. Then make sure that you are keeping current on any other debt you have.
     
  13. MooneyFlyer macrumors 65816

    MooneyFlyer

    Joined:
    Nov 18, 2007
    Location:
    Boston
    #13
    Everyone can get a free credit report annually now thanks to our fine lawmakers. Check out: https://www.annualcreditreport.com/cra/index.jsp

    After that -- there are a number of websites dedicated to doing this that you can find through google. I don't know that there is one right way.

    Some places will remove an overdue payment or similar if it was a one time thing. It sounds from your post that you may have been a little more aggressive than that. I think the timeout on most of that stuff is ~7 years but I don't know off hand.

    It's definitely worth recovering your credit.
     
  14. Rodimus Prime macrumors G4

    Rodimus Prime

    Joined:
    Oct 9, 2006
    #14

    I might like to point out that getting a credit card is one of the WORSE ways to build credit. Yes it helps but it still not considered a good way to build credit.

    A better way is first pay off all your current outstanding bills and clean those up. Then after that start targeting any debt you do have (highest interested first)

    After that then it slow and steady process. You build credit just by paying things on time. My credit was built on renting a house and apparment, having a few bills in my name (internet namely) and yes one credit card that never carried a balance but was ALWAYS paid off in full.

    now a few years later I have 2 credit cards that always pay off in full every month. Power bills. Cell/Internet/Cable TV. That all keeps building my credit history.

    It a slow but steady pass. Generally speaking as long as you never carry a balance on your credit cards and no late payments ect you history just gets better over time.
     
  15. yg17 macrumors G5

    yg17

    Joined:
    Aug 1, 2004
    Location:
    St. Louis, MO
    #15

    Utilities and cable and cell phone companies don't report anything good to the credit bureaus, they only report if you don't pay, so those don't help build credit.

    Credit cards are one of the best ways as long as you're responsible with it. I had a credit score in the middle 700s long before I ever had an auto loan (or cell phones in my name) just because of my responsible usage of a credit card
     
  16. ButtUglyJeff macrumors 6502a

    ButtUglyJeff

    Joined:
    Mar 9, 2008
    Location:
    New York. The state, not the toilet.
    #16
    You need to plan how to pay of your current debt. You should pay the most to the companies that are charging you the most. But you must pay everybody the minimum payment, and do it on time.

    You also need to start communicating with your creditors, and share your plans. This tends to be difficult for most people, as embarrassment tends to make people ignore phone calls. Don't do that. You'll start to find if you keep your word, the calls will start to dwindle.

    Good luck
     
  17. BrettFarve04 thread starter macrumors regular

    Joined:
    Sep 14, 2007
    Location:
    Milwaukee, WI
    #17

    Dude i work my ass off just like every other person in this world...I'm certainly asking for "donations" at all. I'm asking for peoples ADVICE and OPINIONS and judging me "dishonest " isn't cool either. :mad::mad:
     
  18. annk Administrator

    annk

    Staff Member

    Joined:
    Apr 18, 2004
    Location:
    Somewhere over the rainbow
    #18
    This is a bit what I was getting at. In order to pay off your creditors (I'm assuming you can't afford just to pay them all off now, otherwise you wouldn't have posted here asking for advice), you may need to involve your bank. An advisor there can help you set up a realistic plan in relation to your income. Then you can present this to your creditors. Starting off a conversation or letter with them by saying "I've been in touch will my bank, and I have worked out a payment/settlement plan" might make you a bit more credible in their eyes.
     
  19. Supa_Fly macrumors 68040

    Supa_Fly

    Joined:
    May 30, 2002
    Location:
    Toronto, Ontario, Canada
    #19
    Same Vote but Focus!

    I'm in the same vote but remaining FOCUSED this year!

    0> Stay away from these boards after you very first debt payment - the want for a new Mac is VERY hard to resist once looking at the Post your Mac Setup ;) .

    seriously though.

    1> LEARN to live your life with sacrifice!
    - Sacrifice that Starbucks or other trendy coffee costing $5-7CAN/3-5 US every weekday morning (that's already $20 saved per week!)
    - If you smoke STOP!! Especially if you buy a pack a day. You'll save yourself almost $4K this year. Sure easy for me to say but relegate buying 1 pack / week and carry only 3 smokes / day. Smoke them ONLY if you MUST have it - when you feel like a word can set you off. Get KNOWN for begging for cigarettes then your friends/co-workers will stop giving you some - TELL them your trying to quit beginning Monday!!
    - Learn to not have the best things in life for at least 6mths. Try to imagine that only Rent/Mortgage, Food, transportation costs, 1 small luxury a week (movie, album purchase, something under $50) are the things that matter. BDays of loved ones excluded but low spending. Try to think life is like living in prison.

    2> Make a payment plan within your means/abilities based on #1 and STICK TO IT! No wavering nothing!!
    - you gotta make your payments FIRST for your credit rating to go back to R1-3 or close. Think of your Credit Rating BEFORE your Credit Score; fix your debts = fixing your Credit Rating = quicker fixing credit score over time.

    3> KILL multiple credit cards! CUT EM in HALF! If your child / young sibling where to get in trouble for stealing at the store or getting in a fight where he/she was dropped home by the cops, imagine how harsh you'd discipline them; you'd take their favorite toys & priviledges away right? So take away YOURS! Do NOT wait to pay off the credit card with the highest interest - begin PAYING it and CUT IT IN HALF! Scissors!

    4> Make your Lunches every day. Stop ordering Pizza or other dinners often / week.

    5. Post ALL your debts on a wall you look at frequently! post on the Fridge, Bedroom Door, anywhere where you will pass by OFTEN when at home, and will be embarrased if family or friends come by and will SEE!!!!:mad:

    ^ This helps motivate you!

    ALWAYS remember that your CREDIT is like your WORD. In the hood Your word is your BOND! In the financial business your CREDIT is your Bond!

    A man must make his words and his actions agree! Time to put that in practice. Harsh, yes but it MUST be done. Credit is more powerful than cash in some times - not in todays market but it once was say 4-10 years ago.
     
  20. samiwas macrumors 65816

    Joined:
    Aug 26, 2006
    Location:
    Atlanta, GA
    #20
    I think jumping on the guy was the wrong choice. Seems that he definitely wants to get back on track. There was a thread here a few weeks ago with a dude who had like 7 macs, $25k in credit card debt, etc and is going to "do the bankruptcy thing" to get rid of it....claimed that was the purpose of bankruptcy...to let you build up a bunch of debt and then get rid of it (and that it was the credit companies' fault).

    Like many have said, the route back to good credit is to keep up with those bills and payments. Get rid of any credit card that you can, but do have at least one or two with reasonable limits...and keep them paid off. My credit wasn't so hot a few years ago, but this thread just made me get my report again and I was highly surprised!!
     
  21. Rodimus Prime macrumors G4

    Rodimus Prime

    Joined:
    Oct 9, 2006
    #21

    I missed this but I would like to point out something wrong about what you said.

    When I pulled my credit report in fall of 2007 I saw my cable internet provider on my credit report as an active line of credit. Which is correct because techically speaking they are giving me 1 months internet service that I agree to pay for the following month so I had a revolving 50 bucks of credit with them every month. I have not pulled it since I open up my own cell account last year to see if ATT does the same thing but I suspect they do.

    I just stated credit cards are generally considered the worse way for people to try to build credit. People use them to think they are building it by caring a debt on them. I pay them off to and that builds my score slowly but surely.

    Honestly I have no clue what my credit score is but it mostly just been credit cards and some bills over the past 6 years. None of my cards ever carried a balance. Hell saddly I am trying to work though 1800 in credit on one card because I paid the wrong acount. Let me tell you a zero balance card with 1800 in credit on it is a pain in the ass to work though. It will take me 3 months of making it my primary card to eat though all of it.
     
  22. samiwas macrumors 65816

    Joined:
    Aug 26, 2006
    Location:
    Atlanta, GA
    #22
    When I got my report last night, the only thing related to AT&T was a credit pull about 18 months ago. None of my utilities are going as revolving credit lines. In fact, none of my utilities even showed up on my report.

    The way the credit report worded it, your score gets better based on how much debt you have on those cards in relation to how much credit you have available. So if you have 3 cards with $5k limits, you have $15k available. If you keep a very small, or zero balance on those, it shows better for you. I think it's a myth that you actually have to put money on those cards and pay them off.

    I don't use a credit card ever, except for large purchases that I want to be safer with and pay off over 2-3 months (even if I have the money). Both of my credit cards have been at zero balance for months at least. I thought my score would take a small hit because any bill that isn't on auto-pay I generally pay a couple of days late because I forget about them (my water bill is consistently late). But my score was 760-780 depending on the bureau.

    So it obviously depends on a lot of factors and who is reporting on you.
     
  23. yg17 macrumors G5

    yg17

    Joined:
    Aug 1, 2004
    Location:
    St. Louis, MO
    #23
    Your cable company is an exception, not a rule.

    And AT&T bills in advance so they're not extending any credit to you. They are most definitely not on my credit report, for either my landline, U-Verse or cellular service, with the exception of the pulls when I signed up for the service.
     
  24. w0ngbr4d macrumors regular

    Joined:
    Jan 10, 2006
    Location:
    Findlay, OH

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