Here’s How I Paid Off $5,000 Worth Of Debt & Grew My Credit Score From 450-700 In 3 Months!
I actually cringed when I tried to come up with the title for this blog. The words that come to mind are “Click Bait” but this actually worked. Here are the simple steps I took to get rid of $5,000 worth of debt and jumped from 450-700 in 3 months.
Negotiate Debt in Collections
The first thing you want to do when you have debt is NEGOTIATE! I had a little over $5,000 worth of debt in collections and I brought these amounts down to $2,500 when offering to pay within the same month. Don’t be afraid to call your collectors and make some offers. I had some friends in the Debt Collection Business who gave me this tip and WOW! I used Credit Karma to track my score and get the appropriate information for who I owed and for how much. This boosted my score about 120 points!
Self- A Credit Building Loan
Once I got my Credit down to $0.00 I started looking at more ways to bring my score up. My friend told me about this company called Self, here is how it works:
Self is a credit builder loan. You make monthly payments of the desired amount (You have 3 options, $25, $35, $48 or $150.00) These payments are held by a “Certificate of Deposit insured by the Federal Deposit Insurance Corp.” The money is not available to use upfront and is strictly used to help build your credit. By the end of your term, your money will be available to you. In the interim, the company reports your payments to the credit bureau resulting in your credit score going up! The fees associated with this are minimal and worth the 60 points my score went up!
I currently live in an apartment community and unless I’m not paying my rent on time, my leasing managers are not reporting. Honestly, at a previous apartment, I remember being more than a month behind and not getting anything on my report. Unless there is a known issue or any evictions your apartment community isn’t going to report your credit. I actually contacted my leasing office requesting them to report my on-time payments and they referred me to this company called Rent Reporters.
The Company verifies your information with your leasing manager and then reports based on their information. Because I was on time, my score went up about 30 points! I paid an upfront cost for this but again, totally worth it!
Pre-Paid Credit Card
This is a more common way to boost up your credit score. I opened up a pre-paid credit card with capital one. I honestly didn’t have many options. (I started this list all at once and my score hadn’t gone up yet) I pre-paid $250.00 and I had a credit limit of $350.00. I kept my utilization under 20% and every month paid it on time. I only used this card to make my 20% purchase to pay it off. My score went up within 3 months another 60 points!
I am so happy that I have been able to bring my score up as much as I have. I’m proud of myself from bringing my score up as much as I have and hope some of these work for you! Results can vary and I have to point out that I am in no way saying I am a professional but, this worked for me and It may work for you!