Is this the right way to improve?

Innocentredhead

First time poster (well my second for tonight) but please help

Basically I'm 3.5k debt and my credit file is awful. Default after default, and i'm still not paying anything at the moment. I have a CCJ against me as well. I am going to debt free in September as my first student loan/grant payment will be paying off ALL my debt.

I have put my head in the sand and ignored it to this point. I suppose I still am at the moment as I would much rather ring in September and pay off rather than have to deal with it now I suppose

We plan to buy a house in six years as future loan payments will be saved for a deposit. Will my score have improved enough in those six years? What will still show on my report after six years? HELP


Thank you in advance

Arleen

Hi there!

After 6 years the records will go away from your credit file thus they will not carry any impact with new lenders anymore. Of course I imagine that the individual lenders will keep that mark on you in their own databases, so I wouldn't recommend going back to them for a credit in the future without a meticulous credit history.

What will be best for you to do for now is to call them, explain that you will make a full payment in September and to let you breath in peace until then. I understand that this is not a pleasant call to make and it will put you in an uncomfortable position but not doing so may result in you waking up one day just to meet a bailiff at your door coming to reposes property in lieu of the CCJ.

So the best thing to do is give them a call, explain the situation and say that if they will leave you in peace you will make the payment in full as September comes. They may go for it, they may suggest a payment plan alternative - negotiation around that is not exact science but those people, primarily, care about getting their money and that is clean and cheap resolution for them.

As for building your credit afterwards, as you will want a good credit history for that mortgage in six years, there are plenty of guides on this website and forums how to recover and rebuild. In the very worst case scenario you can always get something like Capital one Secured Card to start rebuilding your credit history. But in your position I wouldn't rush to that and take it very slowly, as rebuilding a credit is more about changing your own habits and approach to managing money more than anything else. If you didn't remove the cause for existing situation, it's due to repeat itself.

fatbelly

Innocentredhead wrote: »

I am going to debt free in September as my first student loan/grant payment will be paying off ALL my debt.

And then what will you live on?

Innocentredhead

Thank you Arleen, I think it's a fear thing preventing me from calling. I'm totally anxious about the situation, and would hate them to be awful on the phone to me. It does trigger anxiety attacks the whole thing. Bu tI do need to confront it head on, so I suppose you have just told me what I needed to hear and what I did think


And fatbelly, we can live on my husbands income. We are a low income family but can survive on it - so going debt free is the priority. We will be using what we need to but it will all be gone in September

Innocentredhead

Also, in reply to your final paragraph, I am not in a hurry to repeat the mistakes I have made. I was 18 when I got these credit cars, I'm now 24, and just rushed into maxxing everything out. I have learned and now know better