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tattoDgirl

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HELP! I want a house and I don't know what to do to fix my credit score!!!!!!
I've ignored looking at my credit score because after my divorce I knew that I'd be hurting. My credit score is 530. With two public records (Chap 7 from 2006 and a Judgement for $122 from this year that's been PIF), I have 13 accounts in collections that total $1,744. I have 7 "closed" accounts with the most recent in 2008 and the only one "showing" a balance ....that of which is over $10,000 (I had a vehicle repossessed due to divorce). I know NOTHING about this stuff..... all I know is that I'm considering bankruptcy (again). But I'm unsure if this is the best choice for my situation. I've rented for YEARS and have only had one mortgage (included with bankruptcy... again due to divorce) but I want to own a home again. Do I file bankruptcy again? Do I pay off the collection accounts? What do I do with the derogatory accounts? I can't afford to pay $10,000.....All this is so confusing for me. And please, I'm down on myself enough....I don't need answers like "Don't get married again" etc. I just really really need guidance here. I want my little girl to grow up in "HER" home and not rentals all her life :(

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NO!! on bankruptcy!!!

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That will hurt your credit for another 10 years and your goal is to build your credit, not tear it down.  I do suggest getting copies of all three credit reports and checking for errors (which are likely).  Those you want to dispute in writing and keep copies of all communications until the matter is resolved.  Search for "Statute of Limitations on collections" and find out what it is for your state, because the states differ.  On the credit reports, it will say when a debt is due to fall off, but you want to see "date of last activity" on each account and compare it with the Statute of limitations for your state.  If the current date is more than what the SOL is for your state, the debt is uncollectable due to expiration of SOL.  For example, the SOL in my state is 6 years.  If I had a bill that went into collections on October 1 of 2008, it would not be collectable due to expiration of the SOL, even though it would show on my credit report until next year. It sounds as if some of your collections just may have passed the SOL, so this is something to check out.

Any collection accounts that are yours and are still "active" (still within SOL) you may consider negotiating a "pay for delete" arrangement with the collection agency.  Do this via letter and keep copies of the communications.  They don't have tok agree to this, but it's worth a try.  Offer 25% of the balance due and be prepared to go up to 50%.

The derogatories on your credit will fall off in due time (about 7 years) unless they are for someth[in[g that is not yours and those should be disputed.

I do suggest doing a search for Dave Ramsey and follow his advice for getting debts resolved.  And, please read the articles and utilize the financial tools on this site since they explain credit very well and can be a help in rebuilding,.  I learned quite a bit and was trained in accounting so the essential tools are not being taught in schools like they should be.

This won't be a quick fix, but you can do it.  Even if you don't get a house of your own now, there is no shame in that.  Owning a home means paying property taxes and insurance and the repairs that always occur at the most inconvenient times.  Having the expenses and hassle of those items fall on a landlord isn't a bad idea..I've done bankruptcy and have been both a renter and home owner so understand the pros and cons of all.  . 

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Like said before most of this stuff is from the time of divorce. Bankruptcy stays on your credit for 10 years. The other stuff comes off usually at 7 to 7 1/2 years. By the time your bankruptcy quits hurting you you will be in the clear. Pay bills on time from now till then. Maybe find a GOOD secured credit card. And start the rebuild process. By 2016 you could easily be a happy homeowner if all this is stemming from 2008. Very good advice from the previous poster also. I just added my 2 cents.

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...cont

Unsure if this matters..... but i have NO current credit cards. I have recently borrowed from my 401K to purchase a vehicle and they deduct that automatically from my paycheck, but no other loans. No credit cards. Nothing "open".

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