BiggerPockets

Some suggestions:

- Make sure you don't have any outstanding uncollected debts. If you do, pay them off;

- Get a credit card (or two).

- If you can't get a credit card, get a secured card (one where you offer collateral in return for the line of credit). Use the card at least once a month, and eventually the credit company will allow you to unsecure it.

- Get charge cards at any place where you commonly do business. Use them instead of cash when you shop at those stores.

- MAKE SURE YOU PAY OFF ALL YOUR CARDS IN FULL EACH MONTH.

- Every few months, request a balance increase on your credit card(s).

Thank you for correcting my info, Anthony, and sorry to Casey for giving out bad info!

I used to have 600 credit but 2 years later, I am at 720 or so. What I did was send "good will" letters to all the creditors I wronged (didn't pay) during my early college years. This included 2 paid collections. 2 years ago I had given up on my credit. I had returned to the straight and narrow, but these black marks were on my record and I thought I would have to wait 8 years for them to drop. I wrote the goodwill letters, I got 2 secured credit cards, and today I am a significantly more responsible person and am managing credit well. The goodwill letters basically asked in a really nice way to Chase, Att, etc., that i was stupid and please give me another chance and delete the negative account. And they did it! Today, I have 2 unsecured credit cards with 5 digit limits, not to mention the business lines of credit that I opened for the real estate biz. I am so happy for the 2nd chance the creditors gave me.

The website that helped me infinitely was: http://www.myfico.com. They are have free forums and this is where I went for help. There are so many great resources there in the forums, its like bigger pockets for personal credit. Good luck.

Casey,

...and my score is 600 at last check...

How long has it been since you checked your credit? The first thing I would do would be to order a tri-merge credit report with 3 credit scores to see what's on your file. The report should explain what is driving your scores and offer suggestions to improve your score.

Your credit score is made up of several components including: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%) and types of credit (10%). It's possible to have a relatively low score and not have any late payments if you are using a high percentage of your available credit or if you have little credit, or a short credit history. Check out the MyFICO (dot) com website and search for "What's in your FICO score" for an explanation of how credit scores are determined.

I haven't had a credit card since college 8 years ago...

I think mortgage lenders want to see a minimum of 4 lines of credit, so you need to start establishing credit. Gas cards and department store cards are fairly easy to get. I've heard a couple of strategies here. One is to payoff your balance every month. The second is to leave a small balance and pay it off over several months. I don't know which method is the best. I think you want to maintain any balances under 30% of your available credit and never more than 50%.

I want to buy a home one day is my intention.

It's possible to buy a house without using your credit or going to a bank. You can buy using seller financing or you can buy "subject to" the existing financing. So find yourself a motivated seller and see if they will carry back owner financing or if you can take over their payments.

There should be several articles/posts on BP about these methods of buying that don't require you to have good credit.

Good Luck!

wade

you should check to make sure that any information older than 3 years that is unfavorable is deleted from your credit report (except certain items like bankruptcies)

Applying too frequently for credit can also hurt your score

In addition to the previous posts. I dont know what exactly is on your credit report, but if you are looking to purchase a home in the near future; as a mortgage broker, you should:

1. Have open tradelines (3-4) or alternative tradelines with seasoning.
2. Pay off collections,with notation from creditor stating, 'paid in full or as agreed,' if going FHA.

If you have student loans, make sure they are not in default. Also, if there are any judgements or leins against you it'll deter you, so its important to settle them.

Purchasing a home FHA can put you on the road to having good credit because they basically require applicants to settle most debt prior to submission.

hope this helps....

In addition to the previous posts. I dont know what exactly is on your credit report, but if you are looking to purchase a home in the near future; as a mortgage broker, you should:

1. Have open tradelines (3-4) or alternative tradelines with seasoning.
2. Pay off collections,with notation from creditor stating, 'paid in full or as agreed,' if going FHA.

If you have student loans, make sure they are not in default. Also, if there are any judgements or leins against you it'll deter you, so its important to settle them.

Purchasing a home FHA can put you on the road to having good credit because they basically require applicants to settle most debt prior to submission.

hope this helps....

I have 2 collections on my credit report. One im in the process of paying, and the other one I paid through the collection agency. They told me it would come up on my credit as paid, but not removed. Is there anyway to get it totally removed off of my credit?