Definitely clear it up. Take care of active consumer debt smallest to largest. Make minimum payments on all of them except the little one. When thats done, roll that payment into the next, and the next.
When the actives are done, wake-up the old defaulted ones and make them a settlement offer of 25% or so, unless it re-starts the 7 year clock on your credit. If it's been longer than 7 years, you might just leave 'em.
I recommend Dave Ramsey's Total Money Makeover to get your financial house in order. I don't pay cash for my RE like he does, but did use his debt snowball to knock out $87k in consumer debt.
Glad you recognize it's a problem @John Purcell . Never too late to improve your situation!
If you have the cash you can do as you please. If you need other peoples money you will not likely qualify to borrow.
If you need money you must borrow and to do that you must fix your credit first. Bad credit indicates irresponsible money management. This will undermine your credability in the investing world.
pay off all credit cards before you even think about investing because for 99% of people the interest you would be saving on credit cards is greater than the investment return you could earn and it is basically risk free.
The short answer is yes, you can invest assuming you have some capital and use a hard money lender that lends on the asset itself only, not your credit score. But it also depends on the situation at hand. Is it just a poor score from things in the past and the debt is largely no longer there or is there still substantial debt? If the latter, as others have mentioned, best to get that paid down/off first before looking to invest.
And totally on board with the Dave Ramsey plan mentioned by @Steve Vaughan.
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