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I dont know what to do first...Help!


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OK, I'm a newbie. I'm a 32 yo. I live in MD. Moved from NYC/NJ 3 yrs ago. Here's my situation: I want to buy a (up to $250K) house in B-more, MD. My current FICO scores are EX-569, TU-546, EQ-540. Too low to get financed in the current market. Told the middle score needs to be 620 for an FHA loan.

My CR has: Auto=$11K bal (pd off 12/08), AAC (Providian) Judgment=$2200, Wells Fargo (EDU) late consistently=$2500 total, C1 (RV) bal=$498 (avail=$2), HSBC (RV) bal=$0 (avail=$300), 1st Prem (RV) bal=$265 (avail=$135), LVNV (coll)=$241, E-Rec (med coll)=$195, NCO Fin (At&t Coll)=$164, WFNNB (RV) bal=$130 (avail=$120), VZW (utility write-off)= $124, 1st Prem (RV) bal=$0 (avail=$250), Merrick (RV) bal=$0 (avail=$950), FNB (RV) bal=$0 (avail=$350), Target (RV) bal=$0 (avail=$250). I have a Bally's account that went into default (approx $1200) that AAC just bought. Its not on my report yet. I have quite a few CC that I closed (e.g., Aspire, Credit One Bank, etc.). Outside of the minor coll and my car I have approx $5K in debt (stud loan and judgement).

I rcvd a $1600 bonus from work and I'm expecting a settlment as a result of 2 auto accidents (rear ended 2x). I've been paying off my CC to a zero bal and tracking my CS. I've disputed a few things on EX and these were deleted: LVNV, NCO Fin/09, and Calv Portfolio this week. I spoke to a loan officer who advised me to pay off the judgment and the stud loans.

Question: How bad is it? How fixable is it? What should I do and when? And will these items that were deleted come back? My goal is to be in my house by new years. Is that realistic? HELP me pls. I know I shouldn't expect any of you to be my financial advisor, but I need some help! I appreciate ANY assistance! :)

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Welcome to the club. It is not worse than many of us. Make sure you have all payments on time from here on... DV all collection accounts and dispute at the same time. Focus on TU and EQ more inently for your mid score. Pay all balances on open cards below 50% (at least but shoot for less than 35%). Give it three months, follow the steps on this site and you should see vast improvement by the end of the year. They are cutting rates anyway, so it may be a blessing.

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620 mid-scores are very doable for you. However, I urge you to take a little more time.

Getting rid of the baddies is the first step, but you need some positive credit as well.

No more late payments, this really hurts your score and only time will fix it.

Carry a small balance on all your CCs, 1-9% is optimum. More or a zero balance lowers your score. (This is called utilization. )

Don't close your student loan yet, rather make timely payments. You'll want to close it before you apply for a mortgage though.

The low credit limits on your revolving credit are hurting your scores too, you should establish some higher limit CC and close those (First Premier, HSBC and FNB) As a general rule, age is very important to your score, so you don't want to close accounts in good standing. However, in my experience, the low CLs hurt more than help, regardless of age.

Here how to get some higher CLs:

#1) Work on getting some baddies deleted (judgment in particular), delete inquires from EQ (search forums for the how-to)

#2) Open a Crown Jewelers account

#3) Get a secured credit card, at least $1K CL, if you have the means- more

You should do the three above right now. Then:

#4) Apply for a Hooters Card (Merrick Bank)

#5) Apply to Kay Jewelers

#6) Close those low CL cards


#7) Apply for a CapOne

#8) Apply for Carnival Seamiles (Juniper Bank)

If you start right now and obsess about it, you could be 620+ by spring, if you give it 9-12 months you could be 650+.

I know it's hard to wait, but if you can wait 'till your score is above 660, you'll save about $200/month on your mortgage payments.

Welcome and good luck!


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