I have bad credit and am in the process of cleaning things up, but this past February I had to replace my car and got a high interest loan.
First off my wife loves your site. Any time she has questions, your site is the first site she goes to get answers and advice. I have bad credit due to job loss, I got behind on bills. Now I am in the process of paying off the debts. In February I had to get a car on a high interest loan due to my bad credit. I was in the situation where I was lucky to have been approved for the loan I did get. I only agreed with the loan in hopes to refinance later after making some payments to help me have a good chance at a getting a better interest rate. My question is if a creditor will not settle or delete the collections, will paying the account in full help my credit to where I can qualify to refinance my car? Also, how long should I pay on my car loan before attempting to refinance it? Right now I am only on my 4th payment, but am in hopes to refinance as soon as possible.”
Obviously your wife is a very intelligent and astute person. :-)
It’s not the length of time that you have the loan but the improvement in your credit score. If you don’t know what your credit score is I would advise that you find out. One place to go is Credit Karma and get your current credit score for free. They also have an online tool to help you uncover what factors are bringing your score down.
I suspect that the issue isn’t as much the bad stuff but the lack of additional new stuff to help pull your score up.
Before you start shopping to defiance the care loan, which is possible, I would suggest you make sure that any old negative accounts have been paid. A full payment provides you with the best result on an old item since when you settle it will show the amount forgiven as a bad debt that was not paid and written off to profit and loss. It’s still a negative mark.
Please let me know what your credit score is and more about these outstanding debts and let me try to help you build a plan of action to deal with them.
Please post your responses and follow-up messages to me on this in the comments section below.