I have VERY poor credit, never had a credit card!!?

Ok I have a very bad credit score of 520 and I have a little idea why. Ok I never had a credit card but earlier in my life I took out a $2500 loan for school and I never paid it off until over 3 years later but I paid off the debt in full to the collector. Now it says I currently own a company $309 (which I think I do.) and that the debt has transferred from the comp to TransUnion (I believe!). Ok the first step of what I did is I bank with US Bank and I deposited the $300 for a $300 SECURED credit card along side of a checking account with $2k+ cash in it. I would REALLY like to get my score higher. I am trying to also finance a car around $5000 RSVP. And I was planning on putting $1500 down. So this is a 2 part question. 1. What are good steps at me getting my credit increased. What should I do with the financing a car. I dont mind paying the interest on top of the car also I work a good full time job. Thanks.

Right now, you did the right thing by opening up that secured card with USBank. Because you don't have anything building credit for you, and that secured card will be the backbone of your credit history. Keep in mind that although you paid off that $2500 loan, the damage has already been done to your credit score. And now, the $309 collection is hurting you the worst now. The next 4 links will explain how to settle this debt and hopefully get it cleared from your report.

http://www.creditinfocenter.com/debt/set...

http://www.creditinfocenter.com/debt/neg...

http://www.creditinfocenter.com/debt/Can...

http://www.creditinfocenter.com/debt/Act...

Now if you're sucessful in getting it cleared, that may help your score some. My suggestion would be to take that $1500 that you were going to put down for the car and add it to the deposit for the secured card to increase your limit. Reason I say this is that you want to create a cushion between the total debt that's owed and the available credit. It's going to take a year (12 months) for that USBank secured card to convert to a regular card in which it would be the minimum amount of time to boost your score some to try to get approved for that car loan. I would boost the limit on that card as high as you can, so that when it converts the high limit will report on your credit, helping your score and you'll have an even better down payment. In a sense you would use the money for your down payment to build credit and boost your score with the secured card and then when it converts THEN use it for the down payment. I'll break down what's taken into consideration for financing a car:

1. LTV (loan to value).
2. Term requested.
3. Age of vehicle.
4. Miles on vehicle.
5. Down payment amount.
6. Time at job.
7. Time at residence.
8. Monthly income before taxes.
9. Credit score/profile.

In the year's time that you're waiting for that secured card to convert, your mission is to:

1. Build your score up by custom-building a high limit credit card in good standing

2. Save a nice down payment from the security deposit of the secured card.

Once it converts then use the deposit money as your down payment.

Hopefully these tips and the links I provided will get you on the right path!


Good luck and thanks for reading

First step would be to get a copy of your three credit reports from equifax, transunion, and experian. Go over each of the three credit reports and see if you have any balances outstanding and pay them. Make sure all the negative items are things that you know about. If you have a dispute about any item on there you will have to follow the instructions for disputing something on your credit report.

The bad student loan will affect your score less and less every year until 7 or 8 years has passed (I forgot exactly when it drops off) when it drops off all together. In the meantime having lines of credit like a credit card that you charge and payoff every month, or like an auto loan will help improve your credit. If you go through an auto dealership to buy your car the sales staff can usually help you get a loan one way or another, BMW has its own financing for example, and the staff usually wants to help you get approved so they can sell more cars.

make all of your payments on time. The length of time (or your payment history) is a important indicator to a creditor as to your sincerity to pay them back. And remember that you have to pay back whatever you borrow. ask yourself can I really afford these payments and is it something I need compared to something I want? A car is a good example if you can not take the bus which is cheaper then you must consider a car but weigh the odds remember that student loan good luck eaglescout

I'm confused. What happened with the $300 secured credit card? Is this the $309 you owe a company? Was it paid from your checking account? Was it paid at all? If so, contact TransUnion to correct this information. If you're saying that you recently got a secured credit card, don't run it up over half of the credit limit and pay at least the minimum payment before the due date. With time, your credit score should get better.

You may be able to get a co-signer to get the car through the bank ... this would be your best option as far as interest rates. A car loan would help improve your credit score as long as you make the payments on time. If you have no co-signer, you might try a finance company (such as Guardian or Beneficial) to finance the car, but you will probably need about half the cost of the car as down payment and your interest rate will be pretty high (maybe as high as 23%). You would be paying through the nose. Although you feel you wouldn't mind paying the interest right now, eventually it would get old ... especially a year or two down the road when you're making high payments, you still owe a considerable amount on the car, and it's nickling and diming you with all kinds of repair bills, plus you have to pay full-coverage insurance on it because it's not paid for yet, and even your insurance rates are high because of your credit.

Do you really, really need a car right now? If so, have you looked through the paper for an older model that has been owned by an elderly individual? They're usually not sporty, but they sometimes have low miles and have been taken care of. Depending on where you live, you might be able to pick one up for maybe $3000. If you don't really need a car right now, concentrate on fixing what's wrong with your credit report. Take out a smaller loan with a finance company and pay it off ... it will improve your score. Maybe you'll be in better financial shape next year.

check out www.callusfirstfinance.com or www.myfirstcreditcard.com.au to see what the providers are after they are some non bank lenders on the panel good luck