MarineSniper

Trying to clear my debt

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I have went through a divorce around 3 years ago and recently just remarried. My wife has outstanding credit but mine score is 583 right now. We are trying to purchase a home but with my score that is not an option right now. I have pulled my credit reports to get an idea of what is on it. Right now there is roughly 2,000 in unpaid debt on the reports dating back from 2006. The statue of limitations have not ran out on these yet and the state i live in is KY. There is currently a tax lien from the state on the report but that has been paid in full but still lingers on the report and i have been told even though paid can linger for 7 years.

There are a total of 11 creditors that list debt on my report the mortgage company that we have went through advised me to contact these creditors/debt collectors and ask for a settlement offer in order to pay off these balances which have worked so far on the 2 i have called one was listed for $738 and was settled for $50.00 and the other was listed for $854 and settled for $348. So that takes care of 2 of the 11. I can pay these items off in roughly 2 months of work and he has informed me also to keep a paper trail and for each item i pay off send the information to all 3 major credit reporting agencies.

He has also informed me that since my wife has 3 credit cards that she needs to add me as an authorized user on these accounts which she has done in order to improve my credit rating. But the downfall is he has informed me once i clear my credit report up my credit rating will go down due to no credit on the report. There is only one joint account on the reports for my wife and I and that is a new vehicle that we purchased 15 months ago and have never paid late on the car we have always paid more than the payment needed and applied the remainder to the principal.

If this is accurate once i pay off these debts and my credit rating drops how can i achieve reaching a 620 score in order to finance a house the score is what he told me i needed in order for us to achieve this dream.

I am also a veteran and have my certificate of eligibility for a va backed loan on the house but if my credit rating drops when i pay these items off why does it feel i am in a downward spiral.

Any advice is appreciated.

Thanks

Sniper

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Welcome to the boards Sniper! (My hubby is sniper trained Army and currently in Afghanistan.)

OK, understand this....brokers are working to get you the mortgage, but at times their advice can do more harm than good! You made the right decision to research credit repair and to find us here.

For starters, you should do your best to negotiate for a PFD (pay for delete). This means that you offer to pay the old debt as long as they delete the tradeline. The ones you have settled on will report as "Debt legally settled for less than full amount." Not the best thing but doesn't do any more damage than an unpaid collection. The catch is that many here found out that the stinking CA ultimately sells the balance that you didn't pay to another CA and the cycle starts anew.

NEVER pay a CA a thin dime without getting everything in writing! They WILL lie.

That being said, depending upon your wife's CC's (brand) they may or may not report the AU. Once they report, you should see an improvement in score. Make sure DW's CC's are kept in a low balance state. If they get maxed out, it can actually hurt your score.

One thing hubby learned is that Military Star will not respond to disputes, so if you have one with lates, dispute as never late. He did that and the acct remained, but the lates disappeared! :D

The tax lien will take 7 yrs to clear. Check your report, does it indicate released? I know in Colorado even after you pay, you have to request a release of lien or they don't change it. The CRAs erroneously use the release date as date of payment. Sometimes these dates don't match.

Sending "proof" to the CRAs will accomplish nothing right now. It is a waste of postage. They will simply respond by saying that they "cannot accept" what you send them as proof. The paper trail is good to keep to sue a CA or OC that does not honor any agreement....and that can also help in deletion which would be a good thing anyway.

Does your broker specialize in VA mortgages? Basically, the VA states that as long as you have no credit dings in the past 12 months and no recent foreclosure. If you have a BK, you should be 1 yr post discharge of BK13 and 2 yrs post discharge of BK7. VA loans are not supposed to be credit score based, but often the underwriters will set a specific score. Some use 600, some use 620. You can call around and find out who requires the lowest score. Before the RE market crash, a middle score of 580 would have been good enough.

Come back and give us some more details. What is the debt, who for (CA/OC). NO ACCT # INFO....just need to know how old lates are, when CA got acct, amounts, etc. We can help more with more details.

Good luck!:mrgreen:

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Thanks for the quick response here are the items in question

State Tax Lien #1

Date Filed: Claim Amount:

12/06/2001 $1,424

State Tax Lien #2

Date Filed: Claim Amount:

04/21/2009 $1,342

Okay both of these have been paid in full and still show as active not released on the credit reports I have went to the deeds office and recieved a release of the liens that was filed on 1-25-2010

Negative Credit

AFNI

which is an att cell bill

Collection account. $751 past due as of Feb 2009.

Date Opened:

12/2008

Reported Since:

02/2009

Date of Status:

02/2009

Last Reported:

02/2009

This company wants to settle for $357.07 and it is in writing.

AFNI

yes another att cell bill

Collection account. $482 past due as of Jul 2009.

Called the company and they sent a letter for settlement for $50.00 and that has been paid but not updated on the CR as of today.

Date Opened:

05/2009

Reported Since:

07/2009

Date of Status:

07/2009

Last Reported:

07/2009

Account History:

Collection as of Jul 2009

ARROW FINANCIAL SERVICE

Status: Collection account. $852 past due as of Dec 2007.

Date Opened:

09/2007

Reported Since:

12/2007

Date of Status:

12/2007

Last Reported:

12/2007

CBNA

which is a hospital bill for $287

Date Opened:

06/2009

Reported Since:

07/2009

Date of Status:

07/2009

Last Reported:

07/2009

Account History:

Collection as of Jul 2009

FASHION BUG/SOANB

Status: Account charged off. $376 written off. $246 past due as of Nov 2008.

Date Opened:

05/2001

Reported Since:

06/2001

Date of Status:

07/2006

Last Reported:

11/2008

Account History:

Charge Off as of Nov 2008, Oct 2008, Sep 2008, Aug 2008, Jul 2008, Jun 2008, May 2008, Apr 2008, Mar

2008, Feb 2008, Jan 2008, Dec 2007, Nov 2007, Oct 2007, Sep 2007, Aug 2007, Jul 2007, Jun 2007, May

2007, Apr 2007, Mar 2007, Feb 2007, Jan 2007, Dec 2006, Nov 2006, Oct 2006, Sep 2006, Aug 2006, Jul

2006

150 days past due as of Jun 2006

120 days past due as of May 2006

90 days past due as of Apr 2006

60 days past due as of Mar 2006

30 days past due as of Feb 2006

FFCC-COLUMBUS INC

Status: Collection account. $371 past due as of Aug 2009.

Date Opened:

02/2006

Reported Since:

04/2006

Date of Status:

03/2006

Last Reported:

08/2009

Account History:

Collection as of Aug 2009, Jun 2009, Mar 2009 to May 2009, Jan 2009, Dec 2008, Oct 2008, Mar 2007 to

Sep 2008, Jul 2006 to Jan 2007, May 2006, Apr 2006

FIRST PREMIER BANK

Status: Account charged off. $424 written off. $424 past due as of Sep 2008.

Date Opened:

06/2007

Reported Since:

06/2007

Date of Status:

12/2007

Last Reported:

09/2008

Account History:

Charge Off as of Dec 2007 to Sep 2008

120 days past due as of Nov 2007

90 days past due as of Oct 2007

60 days past due as of Sep 2007

30 days past due as of Aug 2007

NCO FIN/09

Status: Collection account. $219 past due as of Apr 2009.

Date Opened:

11/2006

Reported Since:

12/2008

Date of Status:

12/2008

Last Reported:

04/2009

Account History:

Collection as of Dec 2008 to Apr 2009

OPTIMA RECOVERY SERVICES

Status: Collection account. $186 past due as of Oct 2008.

Date Opened:

05/2006

Reported Since:

07/2006

Date of Status:

07/2006

Last Reported:

10/2008

Account History:

Collection as of Oct 2008, May 2008, Jul 2006 to Apr 2008

TRI CNTY COLL AGENCY INC

Status: Collection account. $33 past due as of Aug 2009.

Another hospital bill

Date Opened:

06/2009

Reported Since:

12/2008

Date of Status:

12/2008

Last Reported:

08/2009

Account History:

Collection as of Aug 2009, Dec 2008

ZENITH ACQUISITION

Status: Collection account. $614 past due as of May 2008.

Date Opened:

03/2008

Reported Since:

05/2008

Date of Status:

05/2008

Last Reported:

05/2008

Account History:

Collection as of May 2008

That is all the negatives on the cr most can be taken care of easily but the problem is how do i go about doing so regardless of which way i go i know it is going to drop my fico score do i not offer to a settlement and just pay in full or do i offer for a settlement offer to just get rid of the things.

Also some of these on the report don't even list a phone number so it is kind of hard to reach these people to solve the matter especially Fashionbug account the number on the report is disconnected

Any advice on how to get these taken care of would be greatly appreciated i can pay these items off in 2 months and would hope by oct or nov my credit score goes to 620 so we can finance a house.

As for the mortgage company doing va loans they do and the underwritters that do the va loans require at least a 620 in order for it to go through i can wait a few months for my score to go up which is not a problem i just want to get my credit re-established the right way

Also according to my mortgage broker i am to send copies to all 3 CRA now the problem is i don't even know where to send the stuff to i can never reach a live operator when i call nor do i know the address which are current for the CRA on this site i have found addresses but don't know which ones to use in order to send this stuff out.

And finally for the items i pay what do i need to send to the cra in order to get this resolved is there a special letter i need to send to them as well

Thanks

Edited by MarineSniper
added one more question
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OK.... now one step at a time...

The release of liens were filed 1/25/2010. What date did you actually pay the lien?

AFNI is a tough nut to crack. I am a little confused....did you have 2 different cell accts with them? What is the DOFD on each? (Date you stopped paying and never went current again.) It is hard to believe that AFNI settled one acct for $50 if there was a $482 balance...and it was fairly recent. That indicates from me that this was ancient. Do you know?

For the CBNA listing and for the TRI CNTY listing (both medical), I would first call the hospitals with a sob story (divorce....whatever) and now you are starting a new life with a new wife and it is impacting your marriage....and that you would like to know if they can call back the acct from the CA and you can pay full balance to them. (A reg CSR will tell you no, so you need the mgr of the patient acct office.) I have done this a couple of times. They pull it back, you pay them, CA deletes. That would save you 2 coll accts.

On your coll accts, find the DOFD and WHO they are collecting for. I might be able to give you direction specific to those.....

Fashion Bug looks to have a DOFD of Feb2006. That makes that 4.5 yrs old. Honestly, that is not having that much of a dent on your CR at this point. I would start with a simple dispute of "no knowledge of acct". They haven't reported it for 6 months....and you say "disconnected" so it is possible that they won't respond and it will be a simple delete.

NCO....just dispute this one. They are known to fold easily these days.

First Premier are jerks. I would write to them and offer a settlement.

Like I said before, your broker doesn't know what he is talking about. The CRA will do nothing with that documentation. Save it for now.

Here is what you do first....

Get a strange color paper from the store. Use a font that is non-standard (like script) and print your dispute on that. It prevents them from simply scanning in the letter for a worthless dispute. Dispute anything you see as inaccurate or "no knowledge of account". (It is up to the CRA and listing creditor to prove it is yours.)

Negotiate with whomever you can....in a PFD...ie: I will pay you $xxx for this acct if you agree to delete this from all CRAs. Please have the person authorized to agree sign the attached. (Attach a letter addressed to yourself saying "We (AFNI) agree that in return for payment of $xxx, we will delete all references to this acct (#1234567) from all applicable credit reporting agencies.

signed,

_______________

auth. agent)

For disputes in writing:

Equifax Credit Information Services, Inc

P.O. Box 740241

Atlanta, GA 30374

EXPERIAN

P.O. Box 9532

Allen, TX 75013

TRANS UNION

Trans Union Corporation

Consumer Relations

2 Baldwin Place

P.O. Box 1000

Chester, PA 19022

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august 17, 2009 State liens paid off

AFNI yes there was 2 cell phone accounts i was going through a divorce and

had to make sure my children stayed in contact with me this was july of 06

yes i stopped paying on them cause my ex had ran up the bills by taking the

phones from the kids.

CBNA well that one is a hospital bill that should have been workers comp

my employer has said that he will pay that one this week for me i have tried

to contact the hospital regarding this

You stated, "On your coll accts, find the DOFD and WHO they are collecting for. I might be able to give you direction specific to those....." what does dofd mean and i will give you that information i have looked at the abbreviations on this site but did not see that one listed.

Thanks once again

Sniper

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DOFD is "Date of First (major) Delinquency". This is the date they use for deletion. The OC is supposed to send that to the CA and the CA is required to report it to the CRA......but often they do not so the CRAs use the "Date Opened" (by CA) as the delete date. This is wrong and why you need to know what the DOFD is.

Imagine you were paying your accts on time. You had problems one month and were 30 days late. You caught up and were current again. Then you went last 30, 60, 90, but caught up to current again. Finally, you gave up the ghost....you stopped paying so your credit report showed 30, 60, 90, 120, 150, 180, CO...... DOFD is not the first or the second 30 day late....DOFD would be that third 30 day late....when you went delinquent, stayed delinquent and it ultimately led to CO.

Continue to talk to the hospital. I have not seen where they didn't pull it back from the CA when it was a workman's comp issue and they were finally going to get paid.

Regarding the state liens....KEEP YOUR RECEIPTS! The reason is that according to the FCRA, they should be deleted on Aug 18, 2016. The courts don't register the date you paid, only the release date so the CRAs use that date for deletion. When you get to Aug 2016, you are going to need those receipt to prove that you PAID it in 2009 and you will have to remind them of the law and most likely have to threaten to sue them to get your deletion. (I did this. For me, I didn't know I needed to request a release of lien. I paid my taxes and 8 yrs later....they were still on my CR. Believe it or not, I still had the receipt! The State of Colorado filed a release....but it had that current date as the release date. The CRAs tried to say it was going to be on for 7 more years!! I was, "Oh HE// NO!" After I sent the ITS letter (intent to sue), I got my deletion.)

AFNI....yeah, so they are about 4 yrs old. What state are you in?

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The state i reside in is Ky and the the state the debts are in is Ky as well.

Ok so the first thing i do is contact the original debtors first and ask to pay them instead of the credit collections department they turned it over to. And if they say they can no longer handle it i have to speak with the collections department i call them and ask for a settlement offer correct.

Once i get an offer hopefully or pay these items off i keep a paper trail with all the reciepts. as i stated i can pay these off in 2 months. so will these collectors notify the CRA or is that something i must do that these are paid when i pay them.

Also being added as an AU on my wifes account will bring up my fico score but what if my score does not reach 620 in a few months after paying these off what could i do in order to get that score to 620 at least.

should i open a secured credit card and keep the balance of the card at least 50% of the CR limit or should i just not worry about the 620 score and then call around and find a broker that does a va loan and ask what score you must have to qualify since i have read in this post that some do at 580.

****updated in regards to one of the AFNI they have emailed me and faxed me a copy of the reciept and also sent me a settled in full letter showing the balance to $0 the letter states

"This letter is to verify that the account listed above has been settled in full. If Afni reported information on this account to

the credit bureaus, Afni will send notification to the credit bureaus with instructions to accurately reflect its current status.

If you have any questions, please contact our office toll free at 1-888-804-2409 Monday - Friday 7 AM - 9 PM CST.

NOTE: This is a receipt for payment. However, if the payment received is later determined to be invalid, collection

activities will resume and the balance will again be owed.

You have the right to inspect your credit. This letter is from a debt collector."

Edited by MarineSniper
Updated AFNI information
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Yes. Speak to the creditors first. It never hurts to ask and I have had some agree so then the collection accts are deleted and everything gets better. Some said no. I then have successfully arranged a PFD with a CA and they go bye-bye. Some said no and no...so they sat there for 7 yrs.

The CAs are supposed to notify the CRAs. They will claim that "it can take up to 30 days to update" which is pure BS. They send an automated message to the CRAs and it is updated right then and there. Sometimes they claim that they sent the update, but it is not reflected on your CR and then they blame the CRA. That is also BS, but at that point, dispute that listing and either they won't verify and it gets deleted or it gets updated.

Normally, I do not recommend that you pay a CA. However, if you are being told by brokers that this is a condition of getting the mortgage, then sometimes you just have to do that.

Yes, adding a secured card can help. Do not keep a 50% balance! Right now debt ratios play heavily in the score. Keep it down to 15%. Don't open too many accts too fast or that can hurt (new credit).

One thing that could help is if your parents have good credit lines with low balances. They can add you as an AU (and you promise your folks you will never USE the acct)....those will usually add great ratio data but will also add YEARS or DECADES to your credit file age which can give you a huge boost! :D

You should see that AFNI acct update shortly. Initially, you may have a slight dip in score that should recover. It will be gone in ~ 3 years.

BTW, the statute of limitations on open accts (like the cell phone) is 5 yrs. That probably explains the low settlement amount. Since you are new, SOL is the date which you can say "nope, not gonna pay you!" and if they sue you can get it dismissed with "outside of SOL" affirmative defense. Reporting period and SOL are not the same thing. That is why I asked where you live.

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Thanks for the great insight on this i will try to contact the orginal creditors on the rest of them and see what happens gonna try one at a time that way i can get it paid and not worry about the others calling and harrassing me about the bills.

As for my parents and their line of credit i am afraid not my mother has never lived by a card at all and she will never have one and she is the only family i have left so i am currently out of luck on that one..

Just out of curiousity i wonder how much of a dip in the score will i have once i pay all these off hopefully it is not a dramatic dip and that i can recover in a few months to get that 620

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That is something I can't predict. If you have had a CA acct that has been there over 2 years and suddenly you have it changed to "paid", it seems to FICO to become recent. Stupid, but that happens. You usually take a small hit on your FICO score.

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Thanks for the insight i was already a member of usaa and had seen that product that they over and was really tempted on using it i need to call them and see exactly how it works and make sure you don't loose points or take hits when they pull it everyday from all 3 CRA.

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Okay paying off these credit report bills is going well. The new problems resides with a medical bill actually 3 that are on the CR. Roughly 3 years ago when i was going through my divorce i was rushed to the hospital for a MI and spent 7 days in icu/ccu because of it. The address in which they had on file at the hospital was the address in which i use to reside with my ex and the bills they sent never got to me because my ex has either tossed them or kept them. For the past 4 months i have been under a payment aggreement with the collection agency for the hospital for a grand total of $14,000 i had insurance but the insurance did not pay for everything. Now these are on my credit report on all 3 CRA.

But it is not showing they are being paid on or anything it is just showing the amounts and the date they were placed on collection which is this year and that is it.

I can pay off all these other bills with no problem but this big bill for medical assistance when i had my heart attack is going to be tough the reason why i made a payment arrangement with that company. i understand that medical bills are a pain in the a$$ but it is going to take me a while in order to pay this off. The question is how do mortgage companies look at medical bills cause i am sure alot of us have them on the reports.

I understand debt/income ratio but this is by far what is worrying me about getting a home loan so i can actually have something in my life that i want.

Any advice would be greatly appreciated.

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Make sure the collection agency is licensed to collect in your state, if not file a dispute with them about it and let them know you do not pay unlicesned collectors. #2. Just because you do not have the money, doesn't mean you can't get a collector to stop reporting. Some will stop reporting if you agree to a payment plan. It's worth a shot. Lastly, dispute everything. You never know...

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