I'm sorry, you are denied!
July 13, 2009 3:45 PM Subscribe
Will my credit ever recover? I was trying to do better.. got a job, paid on time.. But I got rejected for a credit line increase today. Mind you, my current limit is already only $300!
posted by anonymous to Work & Money (10 answers total) 6 users marked this as a favorite
About 5 years ago, when I was a freshman in college I neglected bills and wrote a some bad checks. Awful. I know. About three of these accounts totaling $5k went to collections. I paid about half for a year and then stopped because I was out of work. Today the debt hovers around $3k. I still don't pay these debts.
Despite this I was able to open a checking/savings account with a major bank and was able to get a secured visa w/ a limit of $300 though them in 2006. After a year of good payment history, they refunded my $300 and turned my secured card to an unsecured one. I thought that this was a good sign. I've been using it for little purchases and paying it off every month without a single late payment since 2006. I have an OK job now, but need to return to school soon and will probably need to get loans. Which is why I am worried about my history,
True, I should have paid down those debts ASAP but I went through some personal turmoil for some years and haven't really gotten back on my feet (completely stopped spending, got a steady job, found affordable housing, stopped relying on others for $, and established a real emergency fund) until about a year ago.
What do I do? I really can't ignore the past debts can I? One of my friends suggested just leaving it be since I'm so close to the statute of limitations on them. But that isn't true, is it? Debt doesn't just fall off your report if you hide long enough?! I imagine a lot of dishonest people (like me, I guess) would do this just to avoid bills.
Now that I can help myself a little more, what do I do? If I were to start paying them back today, what would it show on my credit report? Won't it still say that there are collections on them? My current score is a measly 520. How long does it take for my score to reflect repayments? Is it removed when I pay in full or when I start payment?
I feel DEEPLY EMBARRASSED and ASHAMED of this. As I should, but I want to fix things. Can you offer any advice?
By the way, I wasn't trying to up my limit to go on a spending spree. Just trying to up my limit so that I can pay the deposit to rent a truck and move.