A few years ago I basically destroyed my credit. I had just paid off all my cards with a tax return I got and when I moved I found myself homeless. Until I found a job I had to rely on those cards for any expenses.
By the time I left California, I had maxed out my cards and I had to rely on my whole check just to survive. I am moved to another state now and am slowly repairing the damage done. I am paying off debts as I become aware of them (I can't recall them all).
My question is, my credit is horrible. If I got a credit card though my bank (the high interest ones with a required deposit to BUILD credit) would it help me repair my credit, or will the stuff I still owe money on basically make it ineffective?
ID:278358
 Aug 8 2010, 2:23 pm
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I use to work in a bank, specifically related to loans.
We use to use Equifax to track credit. All your "credit score" is, is a list of loans/credit cards/debts you have had in the past, with a tick or cross next to them. A cross representing you did not pay back that debt, missed payments or were late at paying. You can never remove these bad marks. All you can try to do is add more good marks to the list. Different places have different requirements for lending people money. But if you have too many bad marks, regardless of good marks, you're going to be ruined pretty much forever. My advice, though a bit late is to not borrow money unless it is absolutely essential. Even now you seem to want to borrow more money, I have no idea why, but I am willing to bet you do not need to. Unless you are trying to consolidate your debts, you should not be looking to get into even more debt. Pay off all your current debts, don't borrow money again, and only spend money you actually have (debit cards exist). | |
Well as of right now, I have been trying to think about the future. I am 25 right now and I'd like to think about becoming a home owner some time down the line, regardless of how long it takes.
I live with my girlfriend and we both use the same car. She over drafted her account last check in order to buy extra cash playing the "check floating game". Instead of her doing that I had been thinking about getting a $300.00 credit card through my bank and then using that as a gas card and pay it off each month on time, not only making it easier to deal with gas, avoiding over draft fees and (hopefully) slowly repairing some of the damage done to my credit. As of right now, I am slowly getting my debt under control. I am down to $650.00 from $1600.00 with one collection agency and I am currently making $110.00/month payments to another, next month will be my last payment to them. Besides that I owe like $2500 to three other companies and a hospital in Texas, which I plan on tackeling next. | |
That doesn't sound so bad. Two years ago my wife shattered her elbow while we were helping her sister move. Aside from 10,000 in medical bills(after insurance, mind you) we ended up maxing out 4 credit cards because of the missed work, and fell behind on all of our bills.
I would count yourself lucky your in a situation to bring your debt down. In ours, if we try and pay on the debt, we miss a bill. | |
My partner had approximately ~$30k worth of debt.
We moved to Canada. Problem solved. :) | |
If your debit is high enough you cant see paying it off within a couple of years, you may want to consider bankruptcy. After filing bankruptcy you would do well with a low limit credit card to pay off every month.
Also, working for a cellular carrier, this is something I hear a lot of customers ask - "Will my late/on-time payment hurt/help my credit?", cell phone companies only report seriously delinquent accounts on your credit; Monthly on-time or late payments are not reported.