Repairing my bad credit?

Question

I got 2 credit cards when I was 18. I had them both for about a year and was very good with payments, never one late, then I had some tough times at my job and missed some payments and then all the fees just racked up, and I couldnt pay it anymore so I just stopped paying the cards.

I owe them a combined 1,700 dollars. My credit limit isnt that much, most of what I owe now is fees,etc. One is a charge off with the credit limit of 400 bucks, but I owe them 1k because of the fees. Another is a 200 dollar credit limit which I owe 700, because of fees. I have a very good job now and looking to get a car and want to pay off my debts and help improve my credit score. Whats the best way to handle these fees? specially since the big bill is a charge off.

Also I have a medical bill for 300 dollars for some xrays I had done when I broke my hand, and also a 500 dollar phone bill I couldnt pay cause my sister had so much in roaming charges.
Whats my best way to improve my credit?

I stopped making payments a little over a year ago. My Chase card is the one with the 700 dollar balance of what I owe, but only has a 200 dollar credit limit. That account is not a charge off, so if I pay that off, I can get a new card and start using that to make purchases and rebuild credit. Like I said I have a very good job now, and will have no problem paying off the debts I have now, just trying to go about the best way to fix my mistakes. Is there a way when I settle these that they might take it off my report? Or is that just gonna be me wasting my breath.

I just checked my credit report the other day and it listed my 300 hospital bill in like the collections part, so it was on my report.

I stopped making payments a little over a year ago. My Chase card is the one with the 700 dollar balance of what I owe, but only has a 200 dollar credit limit. That account is not a charge off, so if I pay that off, I can get a new card and start using that to make purchases and rebuild credit. Like I said I have a very good job now, and will have no problem paying off the debts I have now, just trying to go about the best way to fix my mistakes. Is there a way when I settle these that they might take it off my report? Or is that just gonna be me wasting my breath.

I just checked my credit report the other day and it listed my 300 hospital bill in like the collections part, so it was on my report.

Answer 1

Call creditors. Work a payment plan, and stick to it. Try making small payments, if they agree, ask them to lower amount owed, if you make larger payments.

Get your credit report, has it been over 7 years since any contact from them, if so, have it removed from your credit report.

It takes time to build credit, and longer to repair credit.
Many unknown factors to give you a decent answer, but try communicating with the ones you owe, and pay them as you agree.

In the future, any credit someone does give you, will be at a high interest rate, if you borrow the money, pay the high rate. (I call it, paying your dues), but paying on time, over time, your credit will return.

In this day and age, credit is a necessary evil

Answer 2

First step to improving it would be to take care of those charged off cards. Let me say though, talking to a financial expert (if possible) might be worth it.

The card with a $700 balance... how late are your payments on that? You might just want to wait for that to charge off too, here's why...

You can settle your debt (in most cases) by writing a letter of distress to the lender, explaining your situation. You may be able to talk them down on the amount owed... anywhere from 10 - 75% (usually in the 40-50% range).

If you do this successfully, they'll send you a letter with an offer at a reduced balance. Say, $600 for card number one. You have to pay that all at once, they won't offer installments. So you'll need to have the money handy before negotiating begins.

Once you pay that, it's a done deal. No more collection calls or anything. And it's a legal repayment of debt.

The downside... It does affect your credit history. These settlements can stay on your report for 7-10 years. But they aren't as bad as a bankruptcy, which basically destroys your credit. DO NOT file bankruptcy! It is an absolute LAST resort.

If your second card (with the $700 balance) isn't closed. See if you can pay all that down without having to settle. If you can, you can keep the card open and use it to repair your credit. If it's closed or charged off... try and settle with them.

And lastly... at this point, do not send in minimum payments (or any payments less than the total balance). If you do that, you'll just be starting the cycle all over again. At this point, having them charge off is a good thing.

Answer 3

ok. first off if you want to buy a car, I disagree with the girl that said don't lease. I have leased every car I have had excluding my first. I am an accountant and the lease is tax deductible if you can justify a business. All depends on your specific situation. On to the credit. If you have the money to pay these people you owe, I would approach this on a one by one basis, meaning the higher one you owe that didn't charge back yet, I would offer to pay that one off in full to keep the account open, so you can try and rebuild your credit.

The others that charged off, you have more leverage with those. If you simply pay them off or request a payment plan, it will still look bad on your credit. Negotiate also the terms of the listing they will show on your credit report. You want paid, paid as agreed, or paid in full. No lates, settled , etc.

As far as the medical bills, you could dispute those with the collection agency that put them there. No doctor or hospital will put anything on your credit report, so I would contact them and do the same. The phone bill as well. If any of this was above your head, please visit the links below for more information

Answer 4

Call each creditor and make a negotiated settlement with them. Agree to pay all the principle and normal interest, (don't offer the interest at first), and get their final offer in writing. This letter should state, "upon receipt of X amount of money that we agree to settle the account and mark the unpaid balance as zero. This letter can be faxed to you and upon receiving it then pay them via a check that has the following wording on the back top, "upon cashing this check the account ###, will be paid in full and reported as such to all the credit reporting services. The medical bill can be renegotiated as well and they will accept a monthly payment, which over the time period will work towards improving your credit score. If you are able to get another credit card, use it very sparingly, and it would probably serve you better to get a secured card from another card company, and once obtained never use it more than about thirty percent of the total credit line. The more available credit you have the higher your score will become when you are paying all creditors on time.

Answer 5

Yea, the fees plus the interest built up will stack up high. The only problem is that the report of the two will not be removed for 7 years, even after you pay the balances in full your score will still reflect the negative report for seven years. Along with the negative hospital report. With that it is up to the lender if you get the loan or not, you may be considered high risk, but then again maybe not. So you should after the balances are paid easily get a auto loan, now mind you, a score of 635 will get you about 14% to 18% interest rate, auto loans rate are always higher. If you put money down it only helps what you finance not your interest rate. Tip, always try a 0 down approach never show cash upfront they want that cash, After they run your numbers you will see what you are eligible for, next always look at the interest you will be paying, if you have a grand for down payment or they ask for money down never give them more than the whole you have and question everything you sign. Good...

Answer 6

Call them up and negotiate; don't give them your phone #. Don't tell them you can pay on it; say you can borrow some money to pay it but not all of it. Most collection agencies will settle; anywhere from50-80% on the dollar. If you don't want to do that, they may reduce some of the interest that has accrued. When setting up any type of arrangements; get everthing in writing. When corresponding with them via mail; make sure to send it certified w/return signature requested.

As far as the credit card you want to use; say good-bye to it. Even if you pay it off, there's no guarantee and they probably won't re-open it for your use. Just pay it off ASAP along with the other debt. However, on a freak chance they are willing to give you your credit line back, get everything in writing and double check the new contract. They may-be offering you a secured account (where you have to make a deposit 1st) and or giving you a rediclous interest rate.

BK is not a reasonable option; you have too little debt; it wouldn't be worth it. Although BK is not the end of the world, it is only for last resort.
If you choose not to pay at all because your credit is already affected; consequences; wage garnishment, liens, judgements, etc.
And, even if it falls off your credit in 7 years, that doesn't mean the collection agencies who bought the charge offs will stop trying to collect.

1st: Pay debts off. Then:

save money in a savings account
get a small jewelry account and pay in 4-6 installments.
when you get new credit(other than jewelry account), don't abuse it. pay it off asap and keep balance under half of your credit limit
don't get too much credit; don't over-extended yourself.

It worked for me.

Answer 7

You CAN negotiate with you creditors to make a payment plan, but make sure you get any agreement IN WRITING. What the collection agency rep says on the phone has NO legal merit.

You should be aware that once the creditor reports the account in default to the credit reporting agencies, it stays that way for 7 yrs, after the last ACTIVITY on the account, so you may reset the clock so to speak.

In general, defaulted credit card debt is considered low priority, especially with the petty balances you have - it's going to cost them more to sue you than they are going to collect.

You should pay the hospital and cell phone bills first, so you can get services if you need them.

Answer 8

Here’s what I would do. Write up a letter disputing whatever you want removed from your credit report (Legitimate or not). Make 3 copies with today’s date, 3 dated 20 days from now, 3 dated 40 days from now and 60 and 80 etc. Seal them in envelopes stamped and addressed to each of the 3 major credit bureaus. Then mail them out every 20 days.

Credit Bureaus are not government agencies. They are in business to make a profit just like everyone else and dealing with the same disputes over and over is not profitable.

You can legally send a dispute letter to the credit bureaus every 20 days. They are required by law to respond to EVERY credit dispute. They will read the dispute and forward it to the company that reported it. The company has X days to reply (maybe 30, I don't remember for sure). If they don't reply the mark is taken off your credit (If the charge is legitimate, it could potentially be reported again later. In which case you would need to start disputing it again).

Many companies will eventually fail to reply if you are sending your dispute every 20 days. They miss it or take too long or even see it and think they already responded confusing it with a previous letter.

Even if they are diligent in responding to each and every dispute, the credit bureau may simply remove the item from your credit so they no longer have to deal with it. Again, it costs them money and eats away at their profits.

This is what credit repair service and credit repair attorneys do. People pay a lot of money to have their credit repaired this way, but you can do it yourself for free. There are sample dispute letters you can find online. Just search for "credit dispute letters". You may get search results selling services that do this, but there are many free letter templates and sample letters.



Who gave the credit bureaus the right to buy and sell our personal information anyway?

Answer 9

Medical bills don't usually get introduced into your credit score.

1) Talk to both the credit companies as far as a payment plan.
2) You never just stop paying a credit card. It doesn't work like that. I hope you've learned your lesson.
3) Work your butt off and pay them off. That's the best advice I can offer.

If you are interested in buying a car, get your finances in order first. NEVER lease a car. Instead, pay for a car in cash. Don't get financing. You don't need a $20,000 car to just get to work. You need a reliable car, even if it's just $3000.

PAY OFF YOUR BILLS!!

Before you add to your bills, PAY THEM OFF!!!

Answer 10

I have been to "many" different credit repair sites on the web. Some were pretty good and some were pretty bad. I refuse to use a websitemy rights and using them.Don't pay for information that you can find for free.