My credit is bad how do I get it better

[nevermore]

I genuinely don't get it. Debt doesn't just appear. You get it because you buy things you can't afford.

Yes, unless you're the victim of identity theft, you seriously deserve the reaction for the question " How do I know which companies I owe money to?"

Exactly.

You pay the companies you borrowed from. You have a lot of credit card debt? Pay the credit card company(ies). A large student loan? Pay the bank that gave you the loan. Did you fail to pay your utilities for a long time? Pay the power company.

No, you don't. You're wrong and thinking too short-term and simplistically.

Once a debt goes into collection, it is often sold to other companies. This happened to me. In college, aka the late 90's, I had a credit card with MBNA, which I stopped using, cut up, and paid way down. I was in college, and was not a super-responsible money manager and I did not keep records of these things and really didn't know or care how much was left. When I moved, I sent them an address update, but they never sent me another bill, so I assumed I had paid it off and went on my merry way. Five years later, I got a letter from some law office/collection agency saying that they had bought my debt from MBNA and I owned the money to them. They never responded to my inquiries, so again, I moved on. This phantom debt has now been passed through at least 4 companies. If I called MBNA today to find out about this, they wouldn't be able to a) take my money or b) tell me who to contact. And I would have some random listing for a company I've probably never heard of on my credit report.

It's not as fucking straight forward as you assume it is once a good number of years have passed and the debt has been sold around. If you've not had any long-term debt problems, then you really don't know what you're talking about.

 

[Guartho]

You yourself just said the collection agency contacted you. It does seem rather odd that they didn't respond to your inquiries. That's definitely a red-flag as to the debt's legitimacy. But, MBNA should be able to tell you who they first sold the debt to, but they may not be able to because they're MBNA.

Anyway, I realize the last post you quoted does say pay the people you originally borrowed from and that isn't necessarily correct. But since my post is in there too, I wanted to clear up that I was saying "pay the people that are sending you bills." which is not in conflict with what you're saying. I do want to add to that though... Pay the people that are sending you bills once you've verified that they're the legitimate creditor.

 

[nevermore]

You yourself just said the collection agency contacted you. It does seem rather odd that they didn't respond to your inquiries. That's definitely a red-flag as to the debt's legitimacy. But, MBNA should be able to tell you who they first sold the debt to, but they may not be able to because they're MBNA.

Anyway, I realize the last post you quoted does say pay the people you originally borrowed from and that isn't necessarily correct. But since my post is in there too, I wanted to clear up that I was saying "pay the people that are sending you bills." which is not in conflict with what you're saying. I do want to add to that though... Pay the people that are sending you bills once you've verified that they're the legitimate creditor.

Well, in my case, which I only used to illustrate that it's not always as simple as people think, the debt is now about 15 years old, so the last time I heard from one of these agencies, I disputed it based on the statute of limitations etc. Never heard back from that one either. And I haven't seen any sort of bill in over 10 years, only form letters informing me that the debt had been sold...

 

[propita]

I must ask this to people who only use cash/debit cards: How do you buy stuff online? It can't be safe to use a debit card online. That's just asking for trouble. At least with a credit card, you can dispute a charge and not be out any money while you're doing it. If something goes wrong with a debit card, the money is already gone...

I don't know, I use a debit card online for everything. As long as you are shopping on reputable sites there isn't a whole lot to worry about. I've been doing it for close to 10 years and have never--not once--run into an overcharge or been the victim of fraud.

You should check with your financial institution, but many debit cards are protected in the same way as credit cards these days. I am pretty sure Visa CheckCard (which is what I have) limits your liability to something like $50 in the event your card is stolen or used fraudulently.

There are people who can limit themselves and use credit cards without a problem; people who have occasional problems; and people who should NEVER have a credit card for charging but should stick with pre-paid cards. I just don't understand the thinking of the last group. It makes no sense to me.


We have three credit cards:

Amex Optima, which used to require full payment every month but I think now they just charge a bunch of interest if you don't.

USAA Mastercard, to change things up and when Amex isn't accepted.

Macy's, to be apprised of sales, though we haven't bought squat there lately and it's not costing me anything to keep it.


We don't have debit cards at all. I got Chase to issue just an ATM card, though USAA doesn't have ATM-only.

Online, I use Amex. When Dell screwed me over with a crappy replacement battery and I was past 21 days of notifying them, Amex got the bill dropped. I wrote a nasty but very polite letter to Dell ("Perhaps your customer service should have authority to deal with...." and "Perhaps Dell should print clearly on the receipts in large print that returns must be within 21 days, and recommend that all parts be checked for functionalty upon receipt". Who checks spare parts until they're needed? Me, now. And "perhaps" is such a great word--one can sound so polite whilst one is slicing and dicing.)

 

[Star Wolf]

How can you not know how to read a credit report? It tells you who you owe money to, how much, and when it was due. It's not hard.

I have to admit when I chose this thread to read I thought is was really going to be about how do the agencies take that information to assign their credit scores.

 

[RoJoHen]

Yes, unless you're the victim of identity theft, you seriously deserve the reaction for the question " How do I know which companies I owe money to?"

Exactly.

You pay the companies you borrowed from. You have a lot of credit card debt? Pay the credit card company(ies). A large student loan? Pay the bank that gave you the loan. Did you fail to pay your utilities for a long time? Pay the power company.

No, you don't. You're wrong and thinking too short-term and simplistically.

Once a debt goes into collection, it is often sold to other companies. This happened to me. In college, aka the late 90's, I had a credit card with MBNA, which I stopped using, cut up, and paid way down. I was in college, and was not a super-responsible money manager and I did not keep records of these things and really didn't know or care how much was left. When I moved, I sent them an address update, but they never sent me another bill, so I assumed I had paid it off and went on my merry way. Five years later, I got a letter from some law office/collection agency saying that they had bought my debt from MBNA and I owned the money to them. They never responded to my inquiries, so again, I moved on. This phantom debt has now been passed through at least 4 companies. If I called MBNA today to find out about this, they wouldn't be able to a) take my money or b) tell me who to contact. And I would have some random listing for a company I've probably never heard of on my credit report.

It's not as fucking straight forward as you assume it is once a good number of years have passed and the debt has been sold around. If you've not had any long-term debt problems, then you really don't know what you're talking about.

Fair enough, I have never had long-term debt problems.

Though once again I have to wonder why people are getting so angry. Calm the fuck down.

 

[nevermore]

Though once again I have to wonder why people are getting so angry. Calm the fuck down.

Surprisingly, holier-than-thou condescension can be off-putting. What may also come as a shock is that debt, especially debt you've been wrangling over for years, tends to be a source of some stress.

 

[Crash]

Though once again I have to wonder why people are getting so angry. Calm the fuck down.

As nevermore pointed out, stress has a lot to do with the issue. There's a lot of cases where this sort of them pops up due to identity theft or mistaken identity, and debt collection agencies are vicious. For a couple of years I had to fight to keep my credit report clean against a slew of debt collectors over a debt that wasn't mine -- the social secuity numbers didn't even match. I ended up taking several agencies to court and winning a handful of judgements, but I still jump when the phone rings. Plus, there's nothing more infuriating then embarrassment, and at one point I was denied a car loan because some agency had placed a black mark on my credit report. I had to challenge them, get it scrubbed, and then go back and reapply.

Frankly, even if a debt is legitimate, these guys are just brutal. They buy up debt for pennies on the dollar and basically use the phone to harass and scare people into paying. Often times they apply absurd interest and fees to a debt, violate the FDCPA with impunity, threaten jail time, scream at you, threaten a lawsuit, and worse. I had one agency open their first phone call with me with "Oh, I'm glad I caught you before the sheriff served you."

That, my friend, is why this is a sore subject.

 

[Robert Maxwell]

How can you not know how to read a credit report? It tells you who you owe money to, how much, and when it was due. It's not hard.

I have to admit when I chose this thread to read I thought is was really going to be about how do the agencies take that information to assign their credit scores.

That sort of thing is a closely-guarded secret.

However, I can tell you how items are weighted in determining your score:

Card utilization - High - If you're using most of your available credit, this looks bad.
On-time payments - High - Even one missed payment can seriously torpedo your score.
Age of credit lines - Medium - It's good to have credit lines that are several years old and in good standing.
Total accounts - Low - It's fine to have a lot of accounts, as long as your utilization is reasonable and you're paying on time.
Hard credit inquiries - Low - When applying for credit, a hard inquiry is done. This stays on your report for 2 years. Try not to rack up too many at once.

So, if you want to make your actual score look good, get a reasonable number of revolving accounts (2-4), keep a little bit of a balance on them (10-20% of available credit), and always pay on time.

 

[kimc]

Still up to my old tricks though as it is GF's card.

So now you want to ruin her credit too? Nice.

 

[Squiggy]

I see nothing but a promising future for that couple.

 

[Guartho]

Still up to my old tricks though as it is GF's card.

So now you want to ruin her credit too? Nice.

I think he means he's already hurt her credit and now he would like to start correcting that.

 

[Scout101]

doesn't look like it, just looks like he's saying he got the gf to take out a card for him so he doesn't get dinged on his own credit. Like he did several times before. Says he's trying to fix his credit, not hers...

 

[Jan]

Still up to my old tricks though as it is GF's card.

So now you want to ruin her credit too? Nice.

I see nothing but a promising future for that couple.

doesn't look like it, just looks like he's saying he got the gf to take out a card for him so he doesn't get dinged on his own credit. Like he did several times before. Says he's trying to fix his credit, not hers...

Exactly. Nowhere has he written anything about having hurt anybody else's credit, only that he's gotten by by having girlfriends get him a card:

As I said I was an idiot for doing that, but the deed was done, and my credit suffered.

Then I would live with different girlfriends and have them get a credit card for me since my credit was bad, or have them get the utilities in their name instead of mine.

While the 'up to my old tricks' may have been unfortunate phrasing, what he actually said wasn't anything negative.

Jan

 

[Guartho]

My current bills situation is manageable so I am not adding anymore debt. Still up to my old tricks though as it is GF's card. But I am good with dough now, no more 3 am benders for me.

He's stopped adding debt, but acknowledging that his most recent card he's racked up is not actually his. When he racked up that debt he was still up to his old tricks. I don't think he's actually hurt his girlfriend's credit yet and it reads to me like he wants to keep it that way.

 

[Garak]

Too funny.

 

[Squiggy]

I lol'd.