The Road to Repairing my Credit

Like a lot of 30 somethings, I made some pretty poor financial decisions in my early 20s. More specifically, I took out a bunch credit cards with my new, fresh out of high school credit and later on in life when times got rough financially, they were the first things that I stopped paying. It’s a little corny, but I’ve always been bothered by the abandonment of my financial responsibilities. Thru the years I have paid off a lot of debt, whether it was forced by a judgement/settlement 😦 or constant nagging from debt collectors. But that was it – I was just paying things off to get people off my back. As naive as it sounds, I never really understood debt and how it affects your credit score. I knew that my credit score sucked and it affected the financing for my vehicles; I figured it would affect me purchasing a home as well at some point. I was so nervous about even applying to rent an apartment last year because of it. It was at that time that I made a promise to myself to rent for 2-3 years, while repairing my credit, in preparation for buying my first home.

My awareness to healthy finances is somewhat of a new thing for me. It really only came about after a super rough period of unemployment a couple of years ago. I have my frivolous spending moments, but for the most part – I try to make healthy economic financial decisions. This will apply to my home purchase. I want the best rates, the best perks, the best decision for me and my budget. Homebase is really important to me; having a place of peace to rest my head, to leave the stresses of life outside the front the door — well, I could talk about the importance of a peaceful home all day, but I digress. The bottom line is that I want to buy a home and want to be as smart about it as I possibly can.

Okay so, the point of this article. I’ve been taking steps to repairing my credit the smart way, which involves a lot of research. I recently came across a thread about sending creditors a “goodwill letter”, requesting a gesture of goodwill from them to remove late payments, charge offs, or anything that has impacted your credit score negatively. I had never heard of this, but again, I’m naive about all of this. I bugged a few friends about it; asked their opinion of it and they were all in agreeance that it wouldn’t hurt to try. Honestly, I didn’t think it would really work, but I knew that I would feel bad about not even trying. First step: Got the address of all my creditors from my credit reports. On another note: I always understood that “debt” would stay on your credit report for 7-8 years. I never understood why some of my debt from 2003 was still on my credit report in 2014?? Found out that if your creditor changes hands, (sold to a collections agency or charge offs) your 7 years starts over. Even if it’s paid. 😦 This is probably my biggest issue. I have things on my credit that were paid off years ago, but are on my credit because of a new start date. Okay, okay I digress.  Second step: Drafted a goodwill letter (which I’ll include below) explaining the purpose of the letter, my new outlook on healthy finances, and my request. You can also file disputes with the credit bureaus online, which I did also, but there isn’t much room for an explanation, so I liked mailing letters too. Last step: Mail ’em out and wait anxiously for a response!

Maybe about a week later, I started getting responses:

So & So Creditor: ” Although we deem your account valid, in an effort to resolve this matter, as a courtesy, the So & So will notify Trans-union and Experian to delete this account from your credit file… “

So & So Creditor: “… the above referenced account is being reported accurately and, therefore, the credit report cannot be changed” :/ 

So & So Creditor (this one was actually a charge off that had been paid off since 2009):”We agree that there is incorrect information on your credit report, so we’ve asked all three credit bureaus to remove this account from your credit report.”

One of the biggest shockers for me was a dispute that I filed with Trans-union for a few judgments that were filed and settled between 2008 – 2011. I did some research and came to the conclusion that judgements, regardless of them being settled or paid, don’t go away without an attorney. So when I disputed them and provided my explanation, I figured I’d get a decline letter. Guess what? They removed them! That was nothing but the lord. 🙂 Another bureau didn’t remove them, but did change their status to paid.

I just figured that I’d share this because it really has helped me and boosted my guilt of not being in control of my debt previously. And the letters seem to work! The ones I created are below – feel free to copy & paste for your own letter. 🙂 Good luck!!

** UPDATE** By the encouragement of my dear friends, I decided to apply for a refinance on my car. I had applied about a year ago and was declined, but since my credit is in the best place that its been in a long time, I decided to atleast try. APPROVED! For 19.3% less than what it has been for the last 2 years ( so just imagine how high it was, if its gone down that much!) .. sometimes adulting isnt too bad.. 😏🙏🙌

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Late Payments Goodwill Letter:

Shari XXXX – Acct Number: xxxx

I recently noticed that my most recent credit report contains late payments reported on my So & So account. I am writing to see whether you would consider a goodwill deletion and remove the late payments from my credit bureau reports.

I want you to know that I understand my financial obligation and took advantage of our relationship by failing to submit my monthly payments on time. Now that I’m older and fully understand the importance of having what I call, healthy finances, it has come to my attention that these late payments with So & So are negatively affecting my credit score. I am requesting that you give me a second chance at a positive credit rating by deleting the late payments as reported on my three major credit bureau files (Experian, TransUnion, & Equifax). I appreciate your time and hope for a gesture of goodwill and to possibly do business with So & So in the future.

Regards

Charge Off Goodwill Letter:

Shari XXXX – Acct Number: XXXX

I am writing to see whether So & So would consider a goodwill deletion and delete this account from my credit bureau reports. I previously took advantage of our relationship and failed to submit my monthly payments on time, got behind, and it was sent to collections. I fully respect my obligations to So & So and have repaid every penny I owe and am now working diligently to amend my relationship with you and regain your trust. I currently have another So & So card that have I have paid on time monthly and kept a low balance on.

Now that I’m older and fully understand the importance of having what I call, healthy finances, it has come to my attention that the charge off with So & So is negatively affecting my credit score. I am requesting that you give me a second chance at a positive credit rating by deleting the charge off as reported on my three major credit bureau files (Experian, TransUnion, & Equifax). I appreciate your time and hope for a gesture of goodwill and to continue doing business with So & So.

Regards

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