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Question By
sabrinamowery

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Credit Scores 517
517

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Time and Discipline

Helpful to 36 out of 36 people

There is no fast fix. I was where you are, lower actually, in 2009. I had a repo, eviction, late on student and personal loans. Just complete disregard for the importance of my credit worthiness. While my score got high enough to buy a VA backed home in 2014, I still bounced between 580 and 630.

To break the cycle, I had to stop doing things my way. First, I educated myself on how the sytem works. Pick up some books from your local library. Don't buy books, go to the library. I tell you this because spending may be at the root of your issue, which leads me to my second point. 

Second, become accountable for your finances. Through education, you will learn that the fundamental reason credit scores exist is to reflect who you are as a financial entitity. If you were a business and barely made enough income to cover your expenses, no one would invest in you. Or worse, if you consistently use credit to cover expenses, it sends a terrible message. Remember that when financial institutions extend you credit, they are looking for a return on their investment. If the likliehood exist that you are a bad investment, they wont bother; and your score gives them that information. Said another way, you have to rethink how you think about money and the purpose of credit.

Third, Dispute aspects of your credit that are reported incorrectly or just wrong. I left nothing for chance. If there was a "No Data" in a tradeline of 6 months late, i disputed it. I couldn't find the answer as to how this impacts when the late will fall off, so I just disputed it. Update your employement history if its not up to date or correct. I was in the military for 15 years, but as I changed units, where I worked also changed. This made it look like I was only at "a job" for a year, when i was in fact there for almost 2 decades. That matters because it shows stability.

Lastly, you have to let time and discipline do the rest. Commit to paying off all of your credit debt. People will say you can carry some money, I say no. Pay it all off. Budget your finances and determine how much you can pay on debt per month. Organize your debt by interest rate and tackle the highest interest rate debt first while making the minimums on all the rest. One one is paid off, aggressively pay off the next highest interest rate. For me, I determined we could afford to pay 1000/month on credit card debt. I borrowed against my 401K at 1.5% and paid off 4 credit cards that were between 21 and 24%. My score jumped 60 points. I'm close to paying off another, putting 700/month on it. When that's paid off, the next highest gets that 700 plus the amount I was already paying on it

Its a slow process, but very rewarding. To stay motivated, I fiddle around with the score simulator. To know that I will be in range of a 780 in 14 months if I keep doing what I'm doing is all the motivation I need. 

Doing these simple things I've gone from a 580 to a 720 in about 5 months time. As old lates fall off, I'm hopeful I can reach 800 by 2018.

Do the thing, and you'll have the power!

Reply by
Kace323

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1 Person Helped
Helpful to 1 out of 1 people

Mine is awful. I was looking for this advice exactly. Thanks for the motivation.

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22 People Helped

Widowed In NH

Helpful to 22 out of 24 people

The credit bureaus use an illogical formula in calculating credit scores. It is sometimes difficult to know if you have too much or too little credit. Either could reflect badly on you. So I have discovered how to beat the system and consistently maintain an excellent credit score. The trick is to nurture your income to debt ratio.

Credit bureaus seem to love that a person has open credit lines available to them but then they punish you for using the credit and lower your credit score. The reason for this is because utilizing the credit and carrying a monthly balance negatively impacts your income to credit ratio.

So what I do is pay off my current balances in full each month a day or two before the statement closing dates. In that way the statements are issued with a $0 balance due and that is what's reported to the credit bureaus.

So even in my situation where I am retired and living on a relatively modest retirement income, the fact that I have credit available to me but never appear to use it seems to please the credit bureaus and so they keep my credit score in the excellent range.

If you cannot afford to pay off your balances in full every month and you are dependent on your credit for basic living expenses then you will be viewed as a credit risk and will receive a lower score... even if you make your payments on time.

The entire industry is really messed up in my opinion!

1 Contribution
13 People Helped

Score jumped 92 points in 3 months

Helpful to 13 out of 13 people

Hi there,

I hope you're trying to figure out how to boost your score. Well, I know first hand, the key is to pay all bills that report to credit agencies on time and more than the minimum balance. I used to say, well, I'll buy this what thing I wanted at the time and pay my creit card bill a week late. It's no big deal. However, it was a crazy big deal. I finally paid any old bills off, paid down all my credit cards and pay more than the minimum payment on tije every month and have been pre-approved for 5 new cards since that time and my score has jumped up 92 points!! It's worth it to be a little disciplined in the beginning because you will reap big rewards in the end.

Top Contributor
7371 Contributions
3810 People Helped

Helpful to 12 out of 14 people

The answer to your unasked question is to read the articles on this site so you can understand how credit works and learn how to build a good credit score.  I did it, it works and things are much nicer with a good credit score.

1 Contribution
6 People Helped

desperately trying to fix my horrible cr

Helpful to 6 out of 6 people

How can I get my credit fixed? I want to own a home and I am afraid I never will with a 517 credit score I feel like I have no hope

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