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How to stop the ups and downs of my credit
Let me start by explaining my situation. First, I am young so I don't have an account more than 2 years old and those are my student loans. I had about 10k in student loans and I have paided them down to a little over 9k now. I also have a credit card with a $300 limit. I was stupid with it when I first got it so I'm usually pretty close to the limit (although I don't have interest until next year). So far I haven't had a late payment on anything, ever. I usually pay $100 a month toward my credit card even if I usually end up using it after I pay it down.. I have one account in collections for about $220 and my credit score dropped 68 points from that. Honestly though I have no idea what account it is, I called the company that was listed and they gave me an account number and another phone number which I called multiple times with no answer. I do have a lot of hard inquiries on my report as well, about 8 last time I checked but most are about to be a year old.

Ok, so the reason I am looking to raise my score: I would really like to stop paying rent and buy my own house in the next 2-3 years. Also I am currently taking the bus and I would really like to get a car and car insurance for a decent rate since I know my age is already going to make it pretty high. And most importantly I want to go back to school and I would really like to get a decent rate on loans if I do end up needing them.

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Patience is needed.

Okay, you have dreams of buying a home and you need a car.  Those are two MAJOR purchases that are going to require good credit an ability to pay.  And you may be wanting more than it's realistically possible to get in the time frame you have.  You may have to tame your enthusiasm.

1.  The account in collections is a stickler. You don't know what it is??  Go to and get copies of all 3 credit reports.  Look them over very thoroughly and file disputes on all errors (not your account, wrong information, etc) with the credit bureau reporting it.  They have to investigate and either verify or delete the disputed item.  This will at least get you the information on that account you need.  Likely it is not your, because errors are quite common on credit reports.

2. Going back to school is very good and it could open opportunities for better work which may mean relocation to another are where the work is.  You are young yet, and you can afford to do that.  Don't buy a house unless you are absolutely, positively sure you will be living in that town for at least 5 years.  And, as one who rented until almost 40, I can tell you that the rent you pay also pays for the repairs and homeowner's insurance and property taxes that come with home ownership, but your landlord is able to pro-rate that expense among the tenants.  You would have to foot the entire costs yourself when you own a home. Check those costs out.

The ideal car to start out with is one that is up to 2 years old and has low mileage.  DO NOT buy a brand new car, because the depreciation eats up a lot of it's resale value in the first year.  A good used car will last you up to 10 years and won't cost as much in purchase price or in insurance.  But, since you live where you have mass transit available (something I only had available for 2 years) you can start saving up money to buy a car for cash while still being able to get around on the bus.  I bought my current car (one year old) for cash after my house was sold (at a net loss) and it's still running beautifully 8 years later.

Keep your accounts paid up, do not let the student loans go into default, keep your credit card utilization down to 20% or less and paid in full every month.  Once you have all credit under control, then you can work on considering the American Dream of home ownership.  It will all happen in due time.

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