Recovering from bankrupcy?

machomadness22 · Jul 8, 2015

I filed bankrupcy almost 2 years ago chapter 7. I have a credit card now that I have been paying on and off since to try and improve my score. But I can't seem to get past a credit score of 669. I have applied for other credit card services to try and do the same thing I'm doing with my other credit card but I keep getting denied. I should mention I don't do this often because I know that can lower your score as well so I have maybe only applied 3 times since Oct 13. I have read that getting an auto loan will boost it up but I have a perfectly working car and I don't want/need another 200-400 dollar bill for a new car. I asking all this because my wife and I would like to purchase a home in the near future and I'm getting concerned with the fact I might not be able to.

Hbone · Jul 9, 2015

Yes an auto loan even a small one will help.

Hbone

Giants83 · Jul 9, 2015

An auto loan won't do much except give you more debt. My score went up after I paid the loan and had a consecutive on time payment history. Revolving accounts (credit cards) are a big factor. Hard inquiries will affect your score but is only a low impact. A big factor is time. There comes a point when you get your score back up that it slows to a crawl and at that point time is only going to help. Length of credit history is huge.
Sign up for creditkarma.com. Not only will you have free access to two scores and reports but they link you up with credit cards that you'll most likely get approved for. It also explains types of credit and the impact it will have on your score as well as give you tips. It was extremely helpful to me when I was trying to get my score back up. Another option is getting a secured card. Put like $500 down on secured capital one card and they often double your limit. Only downfall I found with a secured card is it doesn't do much else for you. I eventually took the hit and closed it after paying it off and got my deposit back. Just keep making payments on time and don't accrue any debt if you don't have to and keep credit utilization under 35%.

Jello · Jul 9, 2015

A lot of banks have credit builder programs where you get a personal loan but you don't get the money until you pay off the loan. Shows as good payments for your credit and at the end you get the money.

Secured credit cards are fine, but you need to never cross the 30% available credit limit or it will actually pull your credit down.

Don't cancel any cards you have going forward, age of credit is a big factor in ratings. Also, you don't want to get another vehicle but comparable credit is something banks are going to look at since your BK. In other words, what have you done to re-establish credit since your BK discharged and if all you have done is open credit cards it's going to cost you extra or could even prevent you from getting approved for the amount you want.

Get with your local credit union and see what kind of credit builder program they have and see what they recommend for your situation, and make sure everything is paid before the due date not just in time.

Deleted member 121863 · Jul 9, 2015

what is the balance/limit on that one card you have? If its over 70% usage and you get it down to 20% or so you will jump 20pts just off that. My BK was discharged in dec 2014 (7 months ago) I`m at 690 and just got a $2000 unsecured card. First CC in over 5 yrs. Gonna get gas once a month and pay it off, keep living cash basis.

Also if you can have somebody else you know add you as an authorized user on a "good card", not high balances or brand new act, that will help you also. Most report for auth users, some cards do not.

machomadness22 · Jul 10, 2015

Giants83 said:
An auto loan won't do much except give you more debt. My score went up after I paid the loan and had a consecutive on time payment history. Revolving accounts (credit cards) are a big factor. Hard inquiries will affect your score but is only a low impact. A big factor is time. There comes a point when you get your score back up that it slows to a crawl and at that point time is only going to help. Length of credit history is huge.
Sign up for creditkarma.com. Not only will you have free access to two scores and reports but they link you up with credit cards that you'll most likely get approved for. It also explains types of credit and the impact it will have on your score as well as give you tips. It was extremely helpful to me when I was trying to get my score back up. Another option is getting a secured card. Put like $500 down on secured capital one card and they often double your limit. Only downfall I found with a secured card is it doesn't do much else for you. I eventually took the hit and closed it after paying it off and got my deposit back. Just keep making payments on time and don't accrue any debt if you don't have to and keep credit utilization under 35%.

Jello said:
A lot of banks have credit builder programs where you get a personal loan but you don't get the money until you pay off the loan. Shows as good payments for your credit and at the end you get the money.

Secured credit cards are fine, but you need to never cross the 30% available credit limit or it will actually pull your credit down.

Don't cancel any cards you have going forward, age of credit is a big factor in ratings. Also, you don't want to get another vehicle but comparable credit is something banks are going to look at since your BK. In other words, what have you done to re-establish credit since your BK discharged and if all you have done is open credit cards it's going to cost you extra or could even prevent you from getting approved for the amount you want.

Get with your local credit union and see what kind of credit builder program they have and see what they recommend for your situation, and make sure everything is paid before the due date not just in time.

Thank you guys ill look into that.

hogan86 said:
what is the balance/limit on that one card you have? If its over 70% usage and you get it down to 20% or so you will jump 20pts just off that. My BK was discharged in dec 2014 (7 months ago) I`m at 690 and just got a $2000 unsecured card. First CC in over 5 yrs. Gonna get gas once a month and pay it off, keep living cash basis.

Also if you can have somebody else you know add you as an authorized user on a "good card", not high balances or brand new act, that will help you also. Most report for auth users, some cards do not.

I'm sitting in the 35% and thanks ill see if my wife will get one and ill try and get on as a auth user and try to get her on mine as an auth user see if that helps.

proche21 · Jul 10, 2015

Did you reaffirm your debt or have a completed bk? Or is it a discharge? I work in mortgage and I know when we come arcoss bk accounts that weren't completed or reaffirmed we don't report to the credit bureau. If that's is the same as other creditors outside of mortgage that could be why it's not going up.

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machomadness22 · Jul 10, 2015

proche21 said:
Did you reaffirm your debt or have a completed bk? Or is it a discharge? I work in mortgage and I know when we come arcoss bk accounts that weren't completed or reaffirmed we don't report to the credit bureau. If that's is the same as other creditors outside of mortgage that could be why it's not going up.

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Not entirely sure...I belive it was just discgarged

pesty4077 · Jul 10, 2015

Anything over a 660 Fico score is a good score for a home. You should be able to get good interest rates at that. The more credit cards you open, the worse debt to ratio for a home.

machomadness22 · Jul 10, 2015

pesty4077 said:
Anything over a 660 Fico score is a good score for a home. You should be able to get good interest rates at that. The more credit cards you open, the worse debt to ratio for a home.

I see, yeah I only have the one capital one credit card and they have a credit tracker thing available for card users through transunion that's who has me at a 669. FICO is the score given by all 3 major credit score companies correct?

proche21 · Jul 11, 2015

Check with the BK attorney you filed through and or the trustee. It also depends on the state you live in. Some do not have reaffirmation.

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Giants83 · Jul 11, 2015

machomadness22 said:
I see, yeah I only have the one capital one credit card and they have a credit tracker thing available for card users through transunion that's who has me at a 669. FICO is the score given by all 3 major credit score companies correct?

No they all have a different one. You can see two of them for free on creditkarma.com. When buying a home they look at your lowest score. My wife's score is 790 but the bank is going off my score. I have 5 revolving accounts. The 5th one was my wife's credit card with a ridiculously high limit and she's had it for 13 years. I added it to drop my current utilization rate and my length of credit history and it brought me up damn near 20 points.

readyset · Jul 12, 2015

With a 684 I was approved for a home in nj no problem. My issue was the debt ratio. Just keep that down as low as possible and getting a home with both of you shouldn't be too much of an issue.

Giants83 · Jul 12, 2015

FHA loans will approve you with 580 score. And a conventional mortgage with a 680 or so. The problem some people have is they get approved for a 30 year conventional loan and put down 10% or so. Now they need a PMI and insurance companies are a little stricter than lenders and generally but not always deny you if you are under 700. If you can't get PMI then you can't get the loan. We

BOWTECH · Jul 12, 2015

Credit score means everything. Just keep on getting credit and paying it off. It is a slow ride building it. But when you get it up there to mid 700's to high 800's. You will never worry again. I hate to say it but your FICO score means alot more than many know. You will see when you can get a 0% APR on any car loan. That's when you will really start to reap the benefits. Stay on course and good luck!

Pekkerwood · Jul 16, 2015

pesty4077 said:
Anything over a 660 Fico score is a good score for a home. You should be able to get good interest rates at that. The more credit cards you open, the worse debt to ratio for a home.

This is the first time in ten years Pesty has posted something I do not agree with. Does not make me right, I just like the fact I am not in total lockstep!

Opening credit cards has a myriad of effects depending on your situation:

Your existing average age of credit. Opening credit cards (except American Express Products if you already have one) reduces average age of credit, increases inquires which can hurt your credit. It has zip to do with your debt to income ratio. Your actual debt to income ratio is how much of your debt you are actually using, not what is available. If you have a high debt to income ratio and open a credit card with a $25,000 limit but do not use it, the decrease in utility will actually increase your credit score more than the new credit will hurt it on average.

Pesty is referring to a "snapshot" of your exact debt to income ratio. I am right. Pesty is still right every other time he posts in my experience. LOL

PWood