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Starting the road back


inthesticks
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My life went to heck in a handbasket in 2007. Well, it started earlier than that when the new housing market tanked in the area we were living in 2005. My husband being a union carpenter, was suddenly out of work. Our economic downslide started. I was working but certainly couldn't keep up with all the payments. His unemployment ended after 6 months. We finally sold the house just ahead of foreclosure in the summer of 2007. Luckily we had lived in it long enough we had enough equity to pay off pretty much everything we owed and had money to buy a small place in a less expensive area.

By this time, of course, our credit was completely trashed. Mortgage with 120 day lates, credit cards closed by credit grantor's request, medical collections. For years I wasn't even able to pull my credit report and look at it. It was just too depressing.

For the past almost 4 years we have lived cash only. The only open credit showing on my report is an old JC Penney card I forgot I even had, with a $100 limit. There is one closed credit card that was opened in 1990 with no late payments (stupid in retrospect to have closed it but I wanted NO temptation to use credit) Capital One, of course, reporting its chargeoff and increase in fees every month.

I bit the bullet and signed up for Quizzle and Creditkarma today. Surprisingly it gave me 635 and 600 respectively as credit scores. Not wonderful I know but better than I thought I figured it would be mid 500s just from having no current activity.

I'm trying to plan my comeback strategy. My current employer has a credit union which I have joined. I'm thinking my first step would be to apply for a credit card through them. I have avoided anything to do with credit for so long I'm really nervous about it.

The CapOne chargeoff is due to pass SOL in Feb. of 2012. Once it's past SOL I want to try the 623 method on it. I don't really want to do it before then as I just beat off a lawsuit attempt by them and I don't want to bring myself to their attention before SOL is up.

I did do some disputing and got a collection account removed. Several late payments have aged off. Everything negative is from 2007 or earlier except for the charge off. My husband was denied for a Home Depot card not for having bad credit but for having no credit.

Wish me luck!

Edited by inthesticks
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It's great you are working to repair your credit! If I were you, I would worry about cleaning up your credit report first and leave the credit cards alone since you and your husband have been managing to live cash only.

You are on the right track, so keep reading the forums on the website!

Be patient and check out Dave Ramsey even. :)

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It's great you are working to repair your credit! If I were you, I would worry about cleaning up your credit report first and leave the credit cards alone since you and your husband have been managing to live cash only.

You are on the right track, so keep reading the forums on the website!

Be patient and check out Dave Ramsey even. :)

I don't want a credit card to actually use it, just to have an open line of credit. I have NONE - no mortgage, no car loan, nada. When I said we live cash only I meant it. However, we are looking at needing to buy a new car in the next year and I'm sure that having NO history for the previous 5 years won't look so good.

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...unless you pay for the car in cash :).

If you decide to get a credit card - get one - Bank of America had a great secured credit card I used and then BOA graduated it to an unsecured credit card after a year.

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Remeber...you actually have about 17 different credit scores. Your FICO New Car score doesn't care about your FICO Bank Card score. In other words, you don't need credit card "utilization" to buy a new car.

There's a good chance your credit union would give you a car loan NOW.

I intend to get the loan through the credit union and while I know they would give me the loan (captive audience payment comes out of your check) they do vary interest rate by "credit worthiness". I have learned my lesson about going into any more debt than is absolutely necessary - we are saving for a down payment right now and by the time my dh starts his social security we should have 8-10k for a down payment.

Good point about the different scores I had forgotten that. What do they look at for a car loan?

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