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My True Bad Credit Story

  I ran into some hard times ended up without a job and borrowed money out of my house as well as all the credit cards including the ones in my wifes name. After a while my wife and I separated for a time due to my own stubbornness. I left her financially devastated. She tried to fix her credit through a debt consolidation company. They told her she would make monthly payments and that the money would go to pay for her credit cards as well as stop the creditors from calling her and in a few months she would be up to date. I said to her "You Can Fix Your Credit". Work it out directly with the creditors and not with a consolidation company but she did not take my advice.

 My wife made her payments every month but the calls did not stop. She kept calling the consolidation company and they said they would make them stop but it still continued. After about a year my wife called to find out how much money had been put towards her credit cards and they said none. She had paid them more than $3,000 and none of it went to her credit cards. The debt consolidation company she was using informed her that in the paperwork she signed it explained that the money she was paying was going into a sort of escrow account and that her creditors would not be paid until a certain balance was reached.

 In the mean time one of the credit card companys she owed sent her a supena, she was being sued for $10,000 dollars that she owed. My wife had been out of work for about 3 months taking care of our son and paying a debt consolidation company with an unemployment check and now she was being sued. She felt forced to claim Bankruptcy. This did eliminate her debt. However the fees were not cheap and now she has a black mark on her credit report that will last a long time. This credit consolidation company did not fulfill it's promises. 
    
Credit Score After Debt Settlement or Bankruptcy
While I had 27 Negative items on the first page of my credit report, including 3 accounts that were still in collection my credit score went to 629 after settling most of the Debt on that page. And opening only one new line of credit with a credit card company.
My wife's credit score was better than mine even with a bankruptcy on her record. Her credit score rose to 669 while she was technically still in bankruptcy. Her bankruptcy case wouldn't close until we finished paying the balance on our vehicle. She opened two new lines of credit with two different credit card companies. So if you have claimed bankruptcy there is hope.  
We knew we had a lot to do when we first began our credit repair campaign. The first thing you need to do to increase your score after you have begun to settle debt or claim bancruptcy is open a new line of credit. If you do not qualify for a regular credit card, get a secured credit card. One trick a mortgage lender told me, is to have a family member with good credit add me as an authorized user on their credit card. If you are able to do that you will have a good credit account on your credit report with a long history of on time payments.
Before our financial downfall both of our credit scores were above 750. After my wifes bankruptcy and my debt up to my eyeballs we felt as though we would never recover. You can choose to pay someone to help you repair your credit. However, if you use the information in this website and research more on your own I am certain that you can fix your credit without paying anyone anything. I did. And within a couple of years I was given the o.k. by a lender for a loan to purchase a house.
The Road to Recovery
When we got back together I owed a creditor for an old credit card $17,000. Truly I only borrowed $8,000 from them. After saving up some money  I called them and settled for only $6,000.  I paid another credit card company $2,500 when the total balance was $10,000 with interest and finance charges.  I called and negotiated with old cellphone companies, cable bills and more credit card bills. All of this took quite a bit of time. I do not make what I used to when I borrowed all of that money. So it took me a while to save up. It is true the credit card companies will settle for a fraction of your debt. I did what the consolidation companies claim to do and I didn't have to pay for their service. 
You Can Fix Your Credit
 It takes time and work but you can fix your credit. Debt settlement may not be the best option beause the settled debt is still on your credit report, but it does show that you did pay. Another option I did not know about at the time is to pay for deletion. You can request them to delete the negative item if you settle your debt. They may not agree, but it's worth a try. You may choose to ignore the calls and letters. Or you might choose to send them minimal payments $10 a month. Do what ever it takes but fix your own credit and don't fall for the credit repair scams.
No Quick Fixes
If anyone tells you they have a quick fix credit repair system, they are not being honest. According to the FTC there is no such thing. Director, Bereau of consumer protection says, " ...don't trust anyone who tells you there is an easy fix, there simply isnt."
What is the FACT Act?
 
 The Fair and Accurate Credit Transactions Act (FACT Act) was signed into law in December 2003. The FACT Act, a revision of the Fair Credit Reporting Act, allows consumers to get one free comprehensive disclosure of all of the information in their credit file from each of the three national credit reporting companies once every 12 months through a Central Source.
 
You may contact the Central Source by visiting www.AnnualCreditReport.com or calling 877 FACTACT. If you prefer to write, a request form is available on www.AnnualCreditReport.com.