Bad Credit Agency

High income but bad credit????

I guess it is true what they say.... it's easier to deal with bad credit when you have no money. I need advice. I have started doing really good financially lately... making over $120k/annually for about the last 2 years. The problem is that I have really bad credit from write-offs and so forth when I was younger - my fault completely. But now that I am more financially stable and responsible I would like to look into getting a nice car (from somewhere other than a bad credit dealership), and possibly look into buying a house at some point in the future. What is the first step for correcting bad credit quickly? Should I hire a CPA or lawyer to help me, or are there companies that can assist with this sort of thing? Any related experiences would be helpful, but general info is welcome as well. Thanks. =) Jim G: LOL - Well, good salary all depends on where you are located in the world. It just so happens that I live in a relatively low- to middle-class part of the country, so $120/yr is pretty good here. It's not like California where the fry cook at the local burger joint makes more than a Midwestern college grad, LOL! I appreciate all the help. There are some awesome answers. But some of them really do not address the problem........ I know I can buy anything by saving or paying cash, but I need to rebuild my credit. Cash purchases do not help a credit rating, no matter how great they are.

Public Comments

1. I don't think lawyers or CPA or those credit repair company can really help you. If you want to buy a house, start saving money so you can have a big down payment. If you want to buy a car with the amount of money you are making, you probably can buy it with cash. Don't over spend. Otherwise you will be back to the same way, bad credit, again.
2. You could contact the creditors and make an agreement (in writing) that they will remove the derogatory information if you pay them something, maybe 50% or less. Some may take it, and if you have it in writing, the credit reporting agency will remove it. Don't pay them a dime, without an agreement, or the 7 years starts again. You can buy a house with 100% financing, but you will probably pay about 9% interest. Try to get the derogatory information off your report by disputing the bad things, just have all three of your credit reports and do them all at once. It will have better luck. You will probably have to pay a little more for auto loans, like 18%, but you need to get some good payments on your report. Time will heal anything. Just go to experian.com and follow their advise on building your credit, it will work. Good luck.
3. Buy a car from a major dealer. Make a decent down payment... You're probably going to take a higher interest rate hit, but that's not all bad. Pay the note every month and it will be a positive show on your credit rating. We did just the same a few years back. Showed we paid off the vehicle and it made our credit look tons better than where it was before we purchased the vehicle.
4. Where did you hear that $120,000.00 a year was good money? Start with some secured credit cards that report monthly to the bureaus, your credit will turn around!
5. You can research this easily on your own by going to a website such as Bankrate.com or simply typing "do it yourself credit repair" into your search engine. To summarize, you should begin by getting your credit report from all 3 credit agencies. Correct any errors and negotiate payments on any accounts that are currently in collections. Charge-offs and other negative reports will stay on your credit report for seven years and if they are correct cannot be removed. Avoid any further late payments or collections. Make sure the credit report contains any loans or credit cards that you have that are in good standing or have been paid off. When you decide to apply for credit, bunch the applications together in a short period of time. By doing this , the total will be only counted as one.
6. Step one ... pay all your past debts. Step two ... save your money and pay cash for your car. There, that was pretty simple, huh?
7. the best way to gain a credit rating from scratch is to show a history of regularly saving money to your bank account and building up the balance. I think you should get into the habit of saving. it has the added advantage of cushioning you against unfavorable circumstances.
8. Fixing problems fromt the past seems to be a hard concept for so many. I'm glad you have an interest in doing so. Start by paying the charge offs. You still owe that money. Pay it off and get it off your credit report. It will still show you had a charge off but it will also show you paid it off. If you want people to respect you, act respectable. It will freak them out of course because most people (in trouble with credit) are not very respectable. To the other people who are reading this. I"ve worked as a collections agent. 98 to 99% of every one I had to deal with was a lier and a thief who was trying to get away with something. I've even had some who would use their kids to call and make changes (while dad was standing behind them coaching them) and all I can say was wow what a bunch of bums. Over the years I've become very cold and jaded with reguard to credit. The 1 or 2% who were just plain good folk who were having problems were honest about it. It didn't take long to figure out which one was which. Like the guy who claimed he had just had a heart attack and was just getting out of the hospital and would be back on his feet soon, if we would just carry him for one more month. He had been doing that for a year. I caught him. Charged him with fraud. Then he had a heart attack for real. No one showed him any mercy. Go see every one of them in person. It won't be easy or even possible with all of them any more, because some of your debt has no doubt been sold. Find out who has it and and pay it. You may then go to your credit reporting agency and ask to make an amendment to your report. Yes you can take time (most don't know you can) to offer your side of the story. Simply include that you have paid them all off. You can offer any reason you want, medical, death in the family, or just say I was young and stupid and then I grew up. Once you have done that, magic will happen. Your credit will improve over night after the last one is paid off and that is that. Churning. This is illegal in the stock market but perfectly legal in credit reporting. With your new found wealth, make a deposit to the bank (pass book savings accout works just fine) and then tell the bank you need a loan and offer the savings account as collateral. They will freeze the account so you can't withdraw any of the money till the loan is paid off. When the first months payment is due, pay it. Then a few days later pay it off. That means that while you have the loan, you don't spend it on anything. Yes it will cost you some interest. Now do it over and over for about 6 to 8 months. You now have a credit report that shows a lot of small loans from your bank that were paid on time and early. Your starting to look better. You have paid off every one you owe from your past and you now have a credit history of taking out loans and paying them on time. It will boost your score a lot. The saving up and paying cash approach. Don't discount this one. Use it as follows. Save up enough to pay for what ever it is you want. Such as a car. Get one that is in the 5K range to start with. I realize thats not a great car for some one making your kind of paycheck. Trust me on this one and follow along for a minute. You should be able to save up the money. Yes all 5,000 dollars. No big deal right? Good. Now go shopping for your car and buy one. Just don't tell the dealer you have enough on hand. Its not his business anyway. Put 3,000 down. Get the dealer to finance you if he will. With that size down payment most will. If not, offer 3500 down. IF not ask your bank to make a car loan for you. Make the first months payment. Make the second months payment. On the third month pay it off. Now go check your score in a month. Wash it, wax it, change the oil, vaccuum out the in inside and hang a for sale sign in the window cause I bet your on your way. using the big down payment to get people to overlook your credit past is one way to rebuild your credit present and future. Just make sure you have enough to pay it off on time and early. It wont' be long before you have a whole new credit score. So yes save up enough to pay for it out right, as some have suggested above, then make a massive down payment and finiance the rest. Just don't spend your nest egg on anything else. You will know when your credit score is on the mend by the number of credit card offers you start to get in the mail. Yes that is my idea of a sick joke. Its only funny because it really happens. There are only 2 kinds of people in this world, them that understands interest, and them that pays it. So just which "them" do you want to be?
9. Go to annualcreditreport.com and order free copies of your credit report from all 3 bereaus. If you want to really find out your score, order your fico scores from myfico.com. Peruse the report for negative items. Do the following: 1. Improve your debt-credit ratio by paying off as many accounts as you can. Pay any delinquint accounts first followed by accounts with the highest interest rates. Do NOT close them once they're paid off. The average age of your accounts is important for your score. 2. Identify accounts that were charge off. Then do what the previous poster suggests: contact the creditor and see if they are willing to settle any account that have been charged off. Before you do it, find out the following: a. What are the rules for making contact in your state? If you call them, does it rest the time limit for them to go after you. b. Make sure they are willing to state in writing before you give them any money that they will report your account as being settled to all 3 credit bureaus. If they don't let them you know you won't give them a dime. Verify that they have done so and follow up if they don't. 3. If you can afford it (and it seems like you can), hire a CFP (Certified Financial Planner) to advise you; a couple of hours should be sufficient. Get referals from friends/colleauges if possible. Do NOT buy any financial services from them. Make it clear that you only want advice. good luck.
10. 1) First step is to always pay bills on time. If you are doing this, your credit will automatically improve as your payment history develops. 2) Obtain secured credit lines. These are basically credit cards that require a deposit to get them in case you default. For example, a card with a $500 limit would require a continuous deposit of $500. Credit unions and local banks can be a reliable source of these if a major bank won't talk to you. 3) Minimize your debt to income ratios. If you have a large amount of credit available and are not using it, that will improve your score. If you can resist the temptation, try to get multiple secured lines of credit and then use only one.

* Some answers may have been provided by Yahoo! Answers.