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  • Frugal
    replied
    I personally would not use a credit counseling company, but that is my opinion. I am not a financial professional.

    Leave a comment:


  • Slandgie
    replied
    I haven't been on the forums in nearly a year, I am surprised that this thread is still somewhat active! I have 4 more payments going to CCCS and then I will be done with them. I am paying the last 3 months on my own.

    Leave a comment:


  • dbstylee
    replied
    get out now...credit counseling is the biggest scam ever

    Leave a comment:


  • minnie1928
    replied
    Originally posted by wincrasher View Post

    Credit "counseling" only damages your credit if:
    1) they withhold payment to the creditor for a time as a negotiating tactic
    2) the creditor posts the "settlement" as a writedown/charge-off
    There is more than just these 2 items. I had my mom enroll with CCCS several years ago (before I knew as much about credit as I do now). We enrolled all her outstanding CC accounts with CCCS. One of them was JCPenney. She had a 100% positive trade line on that card. All her payments were on time, etc. and her balance was $100 or less. We included them in the CCCS debt plan just so it was easier for mom (1 less payment to write out each month). That 100% positive line became a negative line once they notated the account was "Managed by Credit Counseling Svc" or something to that effect. I ended up writing a goodwill letter to JCP and they removed the tag and it became positive again, but it is possible that there are other ways for counseling to damage your credit.

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  • littleroc02us
    replied
    Originally posted by Slandgie View Post
    Ummm, then the lenders are going to be disappointed when I get my debt paid off! We have gotten along just fine without charging anything to a credit card in nearly 2 years.....Sure, it would be nice to have a new refrigerator, but the one we have works fine. It would be nice to get a new washer and dryer, but I got 2 spares in the garage just in case...It would be nice to buy a lot of things, but we have learned a valuable lesson.

    After the credit cards are paid off, then I will be putting half of that money towards the car payments....those will then be paid off shortly thereafter....THEN put half of all THAT extra money towards the mortgage. Our lender does not penalize us or early payment, two half payments per month, etc. I figure we will have our mortgage paid off about 13 years early and I will still be under 50 years old and (hopefully) have the energy to truly enjoy life freely and to its fullest!
    Sweet! I'm loving your attitude. Your one of the few left. I agree whole heartingly with your attitude towards debt. Don't need it don't want it.

    Leave a comment:


  • CCCFree
    replied
    Yes your debt-to-limit ratio carries a lot of weight but due to the fact in 2009 many creditors cut every bodies credit in half so there's a lot of people walking around with maxed out to their credit limit.

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  • GrimJack
    replied
    Yes, 'debt to limit' ratio is important and so is your 'on-time' payment record. I had a score over 800 without having a steady job for 9 years (worked contract) but paid all my bills ontime, whereas DH's score was (just) under 800 having worked steady for 6 years. As soon as a ding from the state of NC (misplaced income tax bill) fell off her report, she jumped over my score by quite a bit. I have not checked my/her/our score lately but now that I finally have a 'real' job, it might be worthwhile checking.

    Leave a comment:


  • wincrasher
    replied
    Income plays no role in credit score - none.

    Debt to limit ratio is a huge factor. Late payments are moderately damaging. Charge offs and writedowns are heavily damaging. Bankruptcy is catastrophic.

    Credit "counseling" only damages your credit if:
    1) they withhold payment to the creditor for a time as a negotiating tactic
    2) the creditor posts the "settlement" as a writedown/charge-off

    Generally, you go into counseling or consolidation after you get behind a good bit, so the damage is largely done by then.

    If you are paying what you owe, and continue to make timely payments, then your score will slowly climb.

    Leave a comment:


  • Slandgie
    replied
    oh, debt to limit ratio....forgot about that one....

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  • Caoineag
    replied
    Ahh oops didn't catch that, debt to limit ratio not debt to income. I didn't pay attention.

    Leave a comment:


  • Slandgie
    replied
    I may have gone off on a tangent there...Oh I know that income isn't that large of a factor, I know this one guy who makes probably 3 times as much as I do, but his debts are way out of control (single guy, no kids, spends money like it's water) and his score is actually less than mine.

    From what I have seen and heard, an average score is in the 680 to 700 range, so I am trying to "become average" LOL

    Leave a comment:


  • jIM_Ohio
    replied
    first, your income has nothing to do with your credit score

    second, if debts are paid off or paid down, its possible that benefit is outweighing other negatives on the score (a score in the 600's is not all that good).

    Leave a comment:


  • Slandgie
    replied
    Ummm, then the lenders are going to be disappointed when I get my debt paid off! We have gotten along just fine without charging anything to a credit card in nearly 2 years.....Sure, it would be nice to have a new refrigerator, but the one we have works fine. It would be nice to get a new washer and dryer, but I got 2 spares in the garage just in case...It would be nice to buy a lot of things, but we have learned a valuable lesson.

    After the credit cards are paid off, then I will be putting half of that money towards the car payments....those will then be paid off shortly thereafter....THEN put half of all THAT extra money towards the mortgage. Our lender does not penalize us or early payment, two half payments per month, etc. I figure we will have our mortgage paid off about 13 years early and I will still be under 50 years old and (hopefully) have the energy to truly enjoy life freely and to its fullest!

    Leave a comment:


  • Joan.of.the.Arch
    replied
    Just as the formula for Coca-Cola is secret and protected, the formulas the credit bureaus use for working out credit scores are secret and protected. So we never know entirely what goes into our scores and how the factors are weighted.

    In another thread you said that you went to Consumer Credit Counselling Services, CCCS, right? Now I may be mistaken about this, but I think that CCCS is actually a non-profit sponsored by credit card companies. It may be that in calculating your credit score, the credit bureaus penalize you less for using CCCS than other supposedly non-profit credit counselors. (Is is really non-credit if the founding head makes, say, $280,000 per year in an office with only six "counselors" employed, each of whom makes $35K per year?)

    Anyway it is possible that your choice to use CCCS marks you as being in the pool of debtors who will eventually and responsibly get it all paid down and in the future borrow more money to help make the lenders even more money. So maybe the credit bureaus take that into consideration.

    This is all just speculation; I have no idea whether it is true that CCCS clients are any more likely to fulfill debt obligations. Even if true, I have no idea whether the credit bureaus have studied and quantified it so as to include it somehow in their formulas. Just maybe.

    Leave a comment:


  • Slandgie
    replied
    Thanks Cao! Yeah, my score was bad to start with LOL

    Leave a comment:

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