She should have contacted the CC companies and asked them to be removed long ago.

I about 6 years ago, I had a few instances where my payment posted a couple of days late and it ended up on my credit report. I contacted those companies and they were removed in 30 days or less.

My credit score is currently 789.

As for filing bankruptcy, I'd highly recommend against it, if at all possible. She should be able to contact the individual companies and ask for a reduced rate in order to pay off her bills. The trade off is that she won't be able to use the cards during that time. But that's a far better alternative to bankruptcy, which will follow her around for a minimum of 10 years (it's no longer 7).

Good luck.

Dude ... have you read some of the posts around here? Would you trust some these clowns to tell you the truth about their financial history?

;)

Short version:

As long as you make payments on time, you should be fine.

The only issue you may have is when it comes time for the monthly payments. This is because many lenders use "Debt ratio" as one of the ways to determine your payment risk. So if you don't make much money, but have a large monthly payment, that will hurt your chances of getting credit, and/or will make the rates higher.

Long version:

The following is some info from an article I wrote last summer on the new FICO 08 credit scoring model (sorry for the length).

Last year, Fair Issac and Co. (the company that developed the credit scoring models used by Experian, Equifax and TransUnion) tweaked the way your credit score is determined. And while it's still super-duper secret, most folks agree that the following are involved:

But financial experts agree that there are certain things that impact your score (listed in order of importance):

• Payment history
• Amount owed
• Length of credit history
• New credit
• Types of credit

In the old model, each of these factors was weighted differently, with payment history being the most important (around 35 percent of the determination), and the types of new accounts and credit used both considered less important (around 10 percent or so).

There were also other actions that could raise or lower a score that most people never considered. For example, the old formula put an emphasis on "hard inquiries," which occur when a lender looked at your report when you applied for a line of credit. Even if you were not approved for the loan—or turned it down—that hard inquiry could lower your score.

FICO 08 (the new model) is designed to put less emphasis on these hard inquiries, and will also change the impact of other items on your report:

• More emphasis on:
• Having a wider variety of credit accounts (positive)
• Having high balances on your credit cards (negative)
  Less emphasis on:
• Actively using the credit accounts you have (positive)
• Applying for new credit accounts (negative)

Fair Isaac has told reporters and finance experts that most consumers will actually see an increase in their score thanks to the new formula, but some may see a slight drop. The company also states that part of their goal is to more accurately judge who is and who is not a good credit risk, and to treat those with a troubled or short credit history more fairly.

They're also looking to minimize what is called "piggybacking" someone else's score. This is when someone with a good credit score adds someone with a poor score on a credit account (usually a credit card) as an "authorized user." Doing so imports the positive payment history of the account into the credit report of the person with a checkered credit history and, thus, raises that person's credit score.

This loophole came to light in 2007, when credit-repair companies started adding customer's information to the credit accounts of complete strangers with good scores. FICO 08 works around this by ignoring "authorized users" on an account and focusing on the actual account holders, including joint accounts.

The final big change in FICO 08 is that it takes into account modern economic reality: more people use credit more often than in the past. Because of this, actively seeking new lines of credit will not impact a score nearly as much as it used to (the "hard inquiry" issue noted earlier).

So just having a bunch of student loan debt won't kill your score. Missing payments on it, or having a monthly payment that increases your debt ratio, will hurt.

MM
~~:shrug:

This.

Oh, and thanks for the correction on the bankruptcy term -- forgot they changed that in that abortion of a bankruptcy bill passed a few years ago.

Talk about shitty legislation ... sheesh.

MM
~~:shake:

Although Dane did a great job, it just occurred to me to ask something:

Was the CC debt paid six years ago, or is she still paying on CC bills from six years ago?

That makes a large difference in advice.

If it's the former, then Dane nailed it.

If it's the latter, she needs to consider a debt consolidation loan over bankruptcy. Get settlements from the CCs first (they'll usually take less at once, than the full amount over a long period of time), add them up, and then see if she can get a loan (credit unions may be a better bet). Just have her totally, 100% avoid payday lenders and other such swindlers.

She should not, however, declare bankruptcy. Not over a few CC bills.

MM
~~:shake:

I was ****ing with you on this one.

Thanks for the rest though. It makes me feel a little better about my future, but it is still going to suck.

The only problem I have is that I have a pretty large credit card bill due to the fact that a tuition rate hike forced my loan to be short so I have to put a 3 hour class, and $641 in text books on my credit card to start the semester. So that, and other credit card stuff, like electric and gas bills, my CC is up to around $3000 right now. I realize that isnt high for most on here, but for me, a college student with no job currently (laid off :() it really blows. I am going to get my next student loan for about $2000 extra so that I can pay off my school and 2/3 of my credit card, then I am going to cut the ****er in half and pay off the bill by this summer and then never use it, unless it is an emergency or I have a good job. My CC is through Citibank and my rates went way up recently, so that is where a lot of the trouble has come from too. I am basically just paying the interest now, so there is no decline in the debt.

Oh ... well, I haven't read tons of your posts, so without a smilie I can never tell who's being smartassed and who's not.

My fault. :D

Ouch ... using CCs for basic bills is such a horrific idea, but better than a payday or car title or refund anticipation loan (all of which everyone should avoid -- always).

At this point, you've got the right idea. Get some extra student loan $$ and pay off the CC in full (or as much as you can). You're also smart to cut it up, yet keep it open -- that will increase the amount of credit you have used compared to what you have available and, thus, increase your score.

In the future, even when you get that kickass job ( ;) ) only charge what you can pay in full each month. That will send your score through the roof.

Don't worry -- you've obviously got a lot of life in front of you. Just get the card paid down, watch your spending and make a budget -- even without a job. Heck, it's even more important when you're unemployed to know where every dollar goes, so do that ASAP!

Then, just be smart, use credit wisely, and you'll be all good.

MM
~~:thumb:

P.S. For those wondering, I had horrific credit in college (like 450). I now have a score of 800+. Granted, it's been several years of work on that, but it can be done.

Thanks a lot again, man!

Yeah, I know I shouldnt use it for basic bills, and I hadnt until this year. That came about because I had a lazy roommate who was at his home in Chicago not turning on the power/gas/water like I was, so I had to use my CC to start all the accounts. So now they all are direct payment due to that, and I cant get his ass to change at least one of them over to his name (he is loaded by the way). I have his parents on my side though, so they may force him to do it because they know he is a lazy slob that I relutantly had to live with to cheapen my rent. Plus side for me is that now that is parents love me his dad said he will get me a great job. He has a ton of connections in everyplace and the mother used to eat at the whitehouse with Nixon because her parents were life long friends of his.... I dont like her quite as much, she seems to socialite-ish too me, but the dad is cool and owned a cheese company for 30 years and just sold it to the french -- If you buy those little cheese wheels in the red bags, I think LeBelle Cheese, that is the one.

They love me because there son up and left his apt. last summer and left all his shit there when he left to work in Milwauke and live with friends there. So being too nice as I always am with friends, I agreed Id help his parents clean out his apt and load it all into a moving truck and then into a storage garage. Once I stopped by his apt. and checked it out (****ing filthy) I called his parents back and told them not to come from Chicago to help me. They are 65+ and did not need to help me move everything out in 100+ heat. Of course I had to do this on the final day of his lease as well, since he hadnt forwarned any of us, and it happened to be 106 that day with the humidity. After a friend helped me get the heavy stuff, I spent 9 more hours straight boxing and packing and moving everything down the stairs and into the moving truck. NO A/C and no help=living hell. Not to mention I have a bad back and had to move out of my 3rd floor apt the following day. Basically, I ended up passing out the next day around 3pm bc I had not slept in 48 hours and was physically exhausted. He owes me huge, of course he has forgot by now, but thankfully his rich ass parents have not! Sorry, way off topic with my rant!

Thanks for the help guys. I was trying my best to convince her not to file bankruptcy. This will help.

I'll tell you this, I am going to start reading more of the bullshit paperwork the credit card boys send out in the small print. I just looked at one of my credit card bills (Advanta Business) and about messed myself when I caught the fact that I was paying a, get this shit.....37.18 APR rate on purchases!! I was like What the ****?? Keep in mind, my credit score is over well over 800 and I have never been late on a bill. I called them up and asked them "what kind of a rat soup, Mickey Mouse, fly by night, chicken shit, loan shark outfit are you running over there?" The old hide on the other end said she could lower it to 24.99%, what a ****ing deal huh? I said, don't bother and told her to listen carefully. I then took the Advanta card and ran it through my heavy duty paper shredder. I said "did you her that?" she asked what it was and I told her "that was the sound of your credit card running through my shredder, you just lost a customer." Within 15 minutes, I had a different "low interest rate card" and had the balance transfered. Advanta can kiss my country ass.

Yeah, they tend to **** everybody over with the APR rates, especially when you sign up, you really need to check/inspect all texts on a paper. It could be a very small font, somewhere in the back, and most people tend to miss it big time.

See what I mean?

You must look easy.

I am easy, but we are talking credit cards here. :doh!:

That was as pissed off as I have been in well over a year. Fuggen rinkey-dink outfit.

725 - Equifax

Is it just me, or did this website used to give you your credit score for free?

I ran a check a few days ago and saw that I have to pay $5 to my credit score now, which is really the only thing I care about.