Credit Repair

The lasting benefits and challenges

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Yesterday I almost made a mistake. I’ve been snowballing into more credit card debt for the last 2 years and almost made a terrible decision. Let’s start at the beginning. I started repairing my own credit in 2015. At this time I was living with my parents and just got started in the real estate business. I started making good money and was able to clear my collections. In a matter of 2 years I had reached a 700 credit score coming from the low 500’s. I purchased my first primary residence with a FHA loan in 2018. This seemed like a long and hard journey, but looking back 2 years really isn’t a long time.

The credit game is a life long continuous game. By now I have personal and business credit and I’m basically knocking on the door of credit access in amounts over 100K. Credit has allowed me the opportunity to survive during hard times when my income significantly dropped and that’s what caused me to be in the debt snowball again, in my opinion all for good reason. When you go from making a nice amount of income monthly to literally zero, your whole life changes. I went through many emotional and financial challenges.

I’m in a transition in life which most of us will experience at some point and since I have the knowledge and skills to repair my credit I was like “screw it”. I”ll let all my debt go to collections and end up paying about 50% less. In my attempt to gain some sort of advantage over the system I realized it was just my emotions getting the best of me. I knew deep down this wasn’t the best option to throw all that I worked so hard to build away but I was just emotionally drained. I have so many accounts to keep up with and truly it is a benefit but tedious to manage.

Some of the benefits of having good credit are

• Access to more money, you have access to actual cash by using cash advances and access to buy things in need or just wants.
• A good credit payment history and low balances just open up your credit file to more opportunities and more options and again more money.
• Your credit profile is looked at as trustworthy and reliable and you can get almost anything you want. Ex(I have an exceptional payment history on my car loan which is through a credit union. I needed to purchase a work vehicle and they cut me a check for 25K no questions asked.

Some of the challenges I’ve experienced are

• When repairing your credit and disputing items you must stay consistent it’s a continuous back and forth process that takes time and diligence.
• When looking forward to making a large purchase such as a home, you must monitor your credit and not open new lines of credit, If you’re going to make a payment late please pay it before it’s 30 days late because then it will be reported to the credit bureaus and this can significantly decrease your score.
• Once you have repaired your credit and you have many open lines of credit keep them below utilization which is 30% or less than the credit limit. Stay on top of your game, use auto pay to make sure your payments are on time.

In conclusion credit can be the best or worst thing that happens to you. You can use it to your advantage and create wealth, enjoy the things you want and especially the things you need during hard times or emergencies. Credit can be your worst nightmare if you don’t monitor and maintain it.