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ntorres178

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Need to get my life back on track but credit score is in the dumps
After some really poor financial decisions in my late teens and early twenties I kinda neglected my credit for a couple of years. My accounts went into collections and I received letters every month like clockwork from different collection agencies as my debt bounced around from agency to agency. Fast forward to 2015, in my mid twenties, I am ready to face my situation. I come to find out that my credit score is 456 TU and 443 EQ. So after a bunch of research, I decided that the best course of action would be: Step 1) to pay off the little that I owe in collections (total of about $1k) and try to get it removed from my report, Step 2) apply for a secured CC, pay in full each month and keep utilization below 30%, Step 3) after 6 months (and hopefully a rise in my CS) apply for an unsecured credit card and hopefully see my credit score rise from there. Is this a sound plan? Any constructive criticism?

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First off, get copies of all three credit reports to make sure only YOUR bills are shown.  Dispute anything that is not yours.  Check the date the debts will fall off the credit report.  That means they will have exceeded the 7 year period for reporting.  Now, do a search for the Statute of Limitations for collections and find out what it is for your state, since it does vary greatly. Any debts on your credit report that are between the SOL and the date of drop-off, disregard because they are uncollectable anyways.  Any debts that may still be collectable, you want to negotiate a "pay for delete" arrangement and that has to be done in writing, via 'snail mail'.  That topic is covered in the articles here.

Your credit card usage you really want to keep at or below 10% for the best scores.

You are on your way to an improved credit score.  Experiment using the score simulator here and keep your usage and payments within the ideal guidelines here and you will have a much better financial future.

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