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Yes, that’s the Amazon store card. It’s actually more like a line of credit, because all they send you is a paper card with your account number on it.
Yes, even though they are showing as paid you should try to get them deleted. You’ll be surprised how much your credit score will change after they are gone. Start sending those goodwill letters!
Check out this article about paid and unpaid debts: http://www.credit.com/credit_information/debt_help/Pay-for-Removal-Deals-Removing-Collection-Accounts-from-Your-Credit-Reports.jsp
Also, you can get your free annual credit report from: https://www.annualcreditreport.com/ (this is THE official website). They don’t give you a score, just the reports (though I think they give you the option to buy the score if you want). Find out how old those collections are. Try to find out what your FICO score is. FAKO and FICO can vary quite a bit sometimes.
With a 670 score you could probably get other unsecured cards, like the GE Amazon card I believe. It’s always wise to wait a few months between applications, specially if you don’t have other credit cards right now. Let your CapOne report, this by itself might raise your score if you don’t have other cards reporting. Give them 30-60 days to report your new card to the bureaus.
Some crazy people at the myFico forums for sure! Haha. I guess some people like collecting plastic.
Yeah, the cellphone plan will do. You just need to show some usage to establish credit history.
How old are your collections? The older the collection, the less it hurts your score. Unfortunately, for credit scoring purposes unpaid and paid collections are equally negative. That’s why it’s very important to try to get them deleted. Specially if you are looking to apply for a home loan.
In the eyes of a lender, a paid collection is much better than an unpaid collection. When asking for a personal or home loan, a lender looking at your credit report will prefer paid over unpaid debt, so I think it’s always a good thing to pay your debts. Of course, a lender will prefer not to see collections at all on your report.
When you’re applying for a credit card (or even a car loan), these are usually automated applications. A computer pulling your report and making a decision based on certain requirements. Some banks will deny you (in less than 60 seconds) if you have a collection on your reports (paid or unpaid). But as I mentioned before, the older the collection, the less it hurts your score. A 4 year old collection will not hurt you as bad as a 6 month old collection.
The Amazon store card does report to the three bureaus (it reports as a store credit card). It’s offered by GE, which is known to be generous with credit line increases (that’s something I can’t say about Capital One). The GE store card is also easier to get than the other Amazon credit card offered by Chase.
I like your way of thinking. You should only spend what you can afford to pay. I would rather not worry about credit at all and use cash for almost everything. However if you want to buy a car, a home or something that requires big money, you got to start playing the credit game.
Use credit to your advantage, don’t go crazy with it ’cause it can get you into a lot of trouble. A lot of people become addicted to credit cards, they like being approved for stuff and have 10, 15, 25 cards. I don’t see the benefit.
Hi ValerieAnne, first of all welcome to the forums.
Right now there’s only one thing you can do to remove those paid collections from your reports, you need to send what they call “goodwill letters”.
The best thing to do when you have an unpaid collection on your credit report is to try to negotiate a “pay for delete”. That is, paying the debt in exchange of having the tradeline deleted from your report. Most collection agencies are willing to negotiate, and sometimes you can even negotiate to pay only a percentage of what you originally owed (as you were able to find out). Once you pay, there’s really not much you can do, except for sending a goodwill letter.
Paid or unpaid collections will stay on your report for 7 years (from the date the account first became past due). A goodwill letter is basically a letter asking for deletion of these items early off your credit reports as a gesture of goodwill.
You have a strong case. I would just send each of these collection agencies (check the names and addresses that appear on your report), telling them your story and asking them (kindly) to delete these collections. Keep sending letters until you get a response.
Here’s an example of a goodwill letter: http://credit.about.com/od/creditrepair/qt/Sample-Goodwill-Letter-To-Remove-Negative-Credit-Report-Information.htm
Regarding your Capital One card, you don’t need to use it all the time. You just need to make small charges every once in a while (say you can pay for gas or food, etc.), pay your bill on time and don’t max out your card. You just need to re-establish credit and make sure your accounts are in good standing. Getting another card eventually would help too. By the way, I love Amazon as well and have their store card, maybe consider applying for their store card at some point…
Rebuilding your credit takes time, so don’t get frustrated if it takes you longer than a year to reach your goal. You need to be patient.
Great. Kudos to your wife!
How did it go closing those credit cards? Just curious to know how it went. Also any news on that collection you were trying to get deleted?
Well, in that case you just need to be patient and wait until some of the inquiries fall off. In the meantime the two accounts that you have will age a little bit, which is good. I think the CapOne card is great for re-establishing credit. How long have you had CapOne for?
You might still have a chance at your credit union if you apply in person and explain your case, but if that fails, you have those other two accounts to work with.
That’s right, I forgot about the CapOne-Orchard merge.
Have you tried applying for an unsecured card at your credit union? You already have a relationship with them, your BK is 8 years old and you have a good credit score (is that a FICO score?). I think you have a good chance.
Check out this thread, apparently this guy was able to get a couple of Amex cards in a similar situation as yours. He was also approved for an unsecured card at Alliant CU. It looks they have a couple of locations in Chicago: http://ficoforums.myfico.com/t5/Credit-Cards/Good-Credit-but-8-yr-old-Bankruptcy/td-p/851746
Welcome to the forums. Sorry it took me a little while to respond but things here have been a bit slow lately.
I believe both Orchard and Credit One are BK friendly, though I would avoid Credit One, their fees are pretty high.
Going to a local credit union sounds like a good idea. You have a good credit score, I’m wondering if you could get an unsecured card somewhere. How recent is your BK?
I apologize for the late reply. Regarding a specific company, I’m afraid I do not know. Have you looked into HUD title loans: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/title/repair
Let us know if you are able to find an answer.
It can affect your credit momentarily until you’re able to bring down your debt. In the long term, closing a card in good standing with a 0 balance will not affect your credit.
Closing some cards would bring down your available credit, and keeping the same debt will raise your debt to credit ratio, and this can momentarily bring your scores down, but once you pay this debt your scores should come back up.
If you do not want to see this short term change in your scores, the best thing would be to pay off the debt first and then close the cards but if this is not possible, then you can just do the balance transfer and keep paying…
Woo-hoo! Awesome. GE seems to be pretty generous about credit line increases. Looks like all your hard work is paying off.May 4, 2013 at 4:29 pm in reply to: Negotiating Debt: Pay for Deletes (Your Experience) #3317
Hi Christie, sorry for the late reply. Congratulations on getting that tradeline deleted, that’s great!
Yes, it worries me but it seems we don’t have a choice anymore. Let me know how it goes if you call them. I’ll keep you posted as well. We were going to call last week but we had other stuff to do and sort of forgot about it. Hopefully we’ll get to it this week.April 19, 2013 at 7:16 pm in reply to: Negotiating Debt: Pay for Deletes (Your Experience) #3309
Hey that’s great news! I’m sure that will give your score a boost.
Have you heard from the other collection agency yet?
My wife is actually in a similar situation regarding a collection agency not responding. We’ve been sending letters to this agency and they keep ignoring us. I think it’s been almost a year already since the first letter. I’ve read that there are some agencies that as a policy do not send letters saying that they will delete, but that some might be willing to negotiate over the phone so, as much as I prefer to have everything in writing, we are thinking about calling to see if we can negotiate.
I don’t think the increase is related to the deposit you were approved for as Capital One states that you may earn credit line increases based on your payment and credit history. My Capital One did get a lot of usage at the beginning as this was my only card back then, and I always paid on time. I think doing these things helped me get an increase, but who knows, I’ve heard other people doing the same and not getting one…
You should try to get a 2nd credit card. You already know that Capital One does not graduate, so you might as well get a second card that will grow with you and when you are ready to close Capital One, you’ll have a 2nd card you can keep with some history as well. If you get a 2nd secured card, get one that will graduate like the ones offered by BOA and Citi (though these are not as easy to get). I’ve heard mixed things about Wells Fargo secured cards, some get unsecured, some don’t. You might be able to get an unsecured CapOne card a few months down the road…a store card might help build some history, and they’re usually easier to get. Having so many collections and a low credit score might make it difficult for you to get approved right now, so you can wait a few months.
Some collection agencies report to the 3 bureaus, some report to 1, some to 2, so you will not necessarily have the same amount of collections on the 3 reports.
In regards to your medical collections, I would try to contact the original debtor first and try to negotiate with them. If the accounts are old, they most likely will not have the records any more. Does the Bank of America collection appear as a charged-off? If so, you will have to deal with a collection agency. It’s already 5 years old, so you could just wait for it to fall off your reports.
Most importantly try to negotiate “Pay for Deletes”, meaning that rather than updating your collection to “Paid”, you will pay them in exchange to have the tradeline deleted from your reports. A Paid collection will not improve your credit score, it will look better if a lender actually pulls your report and sees that you have paid them, but in terms of scoring, a paid collection is the same as a non paid one.
Start by paying the collections with lower amounts first, for better results, offer the full amount in exchange for having the accounts deleted. For higher amounts, you can try to negotiate a lower payment. Google “Pay for Delete” and you’ll find a lot of info on this.
Welcome to the forums. I can tell by reading your post that you have taken the time to inform yourself about how to establish credit and I congratulate you for that.
Getting the secured cards was the first step. The next step is trying to get rid of those collections on your reports. I see you are already doing that, so keep up the good work. You want to try to remove all of them if possible. Do you know old your collections are? Remember that negative accounts fall off your reports after 7 years, so if you have collections this old, they might be falling off soon.
The last step is just paying on time, not maxing out your cards and having a lot of patience. Specially if you have collections on your reports, you need to have a lot of patience with those. It has taken me more than two years to get my scores high enough to finally get good cards. My scores have gone from around 580 to 711 during that time, but I feel having collections and lates on my reports have made things a lot harder for me.
The Capital One card is a great card for establishing credit or for rebuilding. I’m sure you also qualify for the $100 credit line increase by Capital One, the only things is that for some reason they don’t give that increase to everyone. I was given a $100 increase at around the 6 month mark, but I’ve heard a lot of people complaining about not getting one ever. So it seems like they give that increase randomly so don’t be discouraged if you don’t get it.
I’ve had the card for more than two years now and I haven’t received any more increases. I’m closing my account this month, I think it has served its purpose and I want my deposit back. This card never graduates, and I think it’s a shame that it doesn’t. Still, all positive information will remain on your files for 10 years or more, so it’s all good.
Will the Wells Fargo card unsecure at some point?