Bad Credit

[Hawkeye11en1]

I think this is actually a good habit for people to do so they aren't surprised by anything and have time to fix errors.

Someone told me to go to creditsesame.com to check mine - and I did, and it was pretty painless. Not sure what good sites are out there or who to use. Paying to see my credit is dumb, IMO, but I had never seen it until a week or so ago.

The problem was I got a Best Buy credit card because they had the 6 months no interest deal and I wanted a TV for my office. They sent me all the stuff, along with my "credit report". Well, it said I had a credit score of 299. Scared the **** out of me. I looked into it a little bit and I think they have a different scale - something like 84-354 or whatever. Is this common? Or what the heck?

I then looked on that site and found my credit to be 793. So I have no idea what is going on.

 

[Clonefan94]

FTC.gov

A lot of great information here. Plus, you can get your credit score for free, without having to sign up for other companies BS. There are also a lot of scams out there to steal identity. I would be very careful where I go to get my credit reports.

FTC Consumer Information - Credit & Loans: Credit Reports & Scoring

and this:
Want a Free Annual Credit Report?

 

[CarlHungus]

www.annualcreditreport.com

It wont give you a score, but it will tell you all of your accounts and if they are in good standing. Also, you don't have to sign up for anything like freecreditreport.com

 

[longtimeclone]

www.annualcreditreport.com

It wont give you a score, but it will tell you all of your accounts and if they are in good standing. Also, you don't have to sign up for anything like freecreditreport.com

Very good info here. You are able to obtain these reports once a year for free and I have heard the same thing about freecreditreport.com as well.

 

[aeroclone]

www.annualcreditreport.com

It wont give you a score, but it will tell you all of your accounts and if they are in good standing. Also, you don't have to sign up for anything like freecreditreport.com

Good call. This is the official, authorized location to get your credit report online for free. While other sites may do the job, they may also sign you up for who knows what. I've used this site to pull my report from all three of the reporting agencies, and it was pretty quick and painless. I was also able to get an incorrect item fixed on the reports without too much difficulty.

 

[enisthemenace]

Someone told me to go to creditsesame.com to check mine - and I did, and it was pretty painless. Not sure what good sites are out there or who to use. Paying to see my credit is dumb, IMO, but I had never seen it until a week or so ago.

The problem was I got a Best Buy credit card because they had the 6 months no interest deal and I wanted a TV for my office. They sent me all the stuff, along with my "credit report". Well, it said I had a credit score of 299. Scared the **** out of me. I looked into it a little bit and I think they have a different scale - something like 84-354 or whatever. Is this common? Or what the heck?

I then looked on that site and found my credit to be 793. So I have no idea what is going on.

Same thing happened to me. Made me uneasy, as well, but this makes me feel better about it.

 

[redrocker]

Had a friend of mine get into trouble by getting in over his head with a couple loans and got a couple credit cards. Basically he stopped buying and paid on what was his current debt. He finally managed to get back on his feet but it took him a while.

Good for your friend. :yes:

 

[ISUCyclones2015]

My problem is getting started. I obviously have bad credit because I am young and the only thing that would be on there is my student loans and a checking account. I've gotten denied for a CC once already but I've heard it can negatively affect your score if you try to sign up for one and get denied too many times.

 

[The_Architect]

3. Close any open accounts with no balance

You sure about that?

 

[Al_4_State]

An interesting note regarding what can effect credit score:

I'm just starting the home-buying process, and about 2 weeks ago, I signed up for a Best Buy credit card while buying a new lap top in order to spread out the payment and build more credit history. They ran my credit score and it was pretty good.

When the bank ran my credit score last week, it had slipped two points due to having too recent of an account. I'm sure it will rebound (and its not like 2 points make much of a difference) when they get my first payment at 4x the minimum, but having the extremely recent account was listed as one of the main negatives of my credit score, along with limited credit history (only have a paid off car loan and student loans).

 

[State43]

It's not something you can obviously fix overnight, takes time. Here's a few tips.
1. Consolidate your debt if you can. Better to have 1 monthly credit card payment than 4, if your friend has that kind of debt.
2. Pay your bills on time, something that gets overlooked.
3. Close any open accounts with no balance

This + I would add. Keep your oldest credit card open and use it periodically about once a month but pay it off within the next billing cycle as this will improve your credit score. You can use it to buy small things like gas or whatever. I had beyond terrible credit my first 3 years out of college due to being a moron. Over time, I now have what's considered good credit. As soon as a couple bad marks from years back fall off my report, I will have "great" credit. Another key thing would be to make sure you don't have a ton of "Potential debt." As stated above, even if you only owe say $2000 in debt, if your credit limit for multiple cards is like $30,000 or something, that is still considered a risk in creditors eyes.

 

[cy616]

It's not something you can obviously fix overnight, takes time. Here's a few tips.
1. Consolidate your debt if you can. Better to have 1 monthly credit card payment than 4, if your friend has that kind of debt.
2. Pay your bills on time, something that gets overlooked.
3. Close any open accounts with no balance

No to quibble, but #1 and #3 could have a negative impact on credit score. Looking for a consolidation loan will increase credit inquiries, which is negative. Closing open accounts would increase usage of available credit, which is negative.

 

[CarolinaCy]

Absolutely. It can actually harm your credit score to run it too often, but once a year is fine. Its usually free also.

Not true. You can view your own credit report every day if you want and it will have no effect on your score.

 

[jbhtexas]

I'm just starting the home-buying process, and about 2 weeks ago, I signed up for a Best Buy credit card while buying a new lap top in order to spread out the payment and build more credit history. They ran my credit score and it was pretty good.

Watch out for these company credit cards. They are often treated as "personal finance accounts" instead of "revolving accounts" like normal credit cards are. The credit bureaus will ding your credit score if you have multiple personal finance accounts.

A few years ago, I bought some furniture from Rooms To Go interest free for a year, and had to get an RTG credit card in order to do that. I paid that furniture off long ago and closed that account, but Equifax and TransUnion still show that account as a personal finance account and ding my credit score (I also have a home equity loan which is a personal finance account).

 

[boone7247]

My problem is getting started. I obviously have bad credit because I am young and the only thing that would be on there is my student loans and a checking account. I've gotten denied for a CC once already but I've heard it can negatively affect your score if you try to sign up for one and get denied too many times.

I had this issue when I fist graduated, I had 0 credit, as I never had a loan or anything. At the time Capital One had a credit card that I paid a $250 deposit on, which was also my limit. Within in 6 months I had my deposit back and a higher credit limit. Key was finding the right card, and using it for small purchases, and paying it in full every month. Not sure if they still do this, but it is an excellent way for you to get started.

 

[Al_4_State]

Watch out for these company credit cards. They are often treated as "personal finance accounts" instead of "revolving accounts" like normal credit cards are. The credit bureaus will ding your credit score if you have multiple personal finance accounts.

A few years ago, I bought some furniture from Rooms To Go interest free for a year, and had to get an RTG credit card in order to do that. I paid that furniture off long ago and closed that account, but Equifax and TransUnion still show that account as a personal finance account and ding my credit score (I also have a home equity loan which is a personal finance account).

Good to know. I figured they were treated like regular credit cards, and I found them preferable because their store specific applicability made it easier to avoid just racking up every day charges, and you have no interest if you pay them off in the set period of time.

 

[Naughtius]

I've seen a couple misconceptions on here. Some have already been rebutted, but let me add my voice:

• Paying more than the minimum has no impact on your score. You either made timely and sufficient payments or you didn't. No extra credit
• Pulling your own credit has zero impact on your score. It did once, but now the bureaus can distinguish between a "hard" (meaning an application for credit) and a "soft" pull (someone reading their own credit, utility company, etc.)
• Closing accounts raises your debt utilization percentage, which can lower your score.
• It takes AT LEAST 7 years for a major deliquency (collection, bankruptcy, forecloser) to cycle off. Can take as many as 10 years.
• Consumer Credit Counseling is generally regarded as a bad thing, especially if it's with a company that's has a habit of burning lendors (looking at you, Tom Coates)
• New accounts don't help your credit for about 1 year. So if you get a loan and pay it off in 6 months, you've saved some $ but it won't improve your score. But screw up in that first year.....
• Creditors like to see you gradually increase your credit portfolio. Credit card -> car loan -> mortgage. Most people don't know that your credit score differs according to what you're applying for. You could have an 800 FICO for a new credit card, but a 720 for a mortgage application.

One piece of advice I haven't seen for repairing bad credit: Get new credit. You can help a bad score by obtaining new credit after your score went south. Have your buddy try a store card (Sears, Lowe's, etc.) AND PAY IT OFF EVERY MONTH.