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Anyone Gotten Out of Massive Debt? I Concern I Have in the Future

by sree94
12 replies
Now that I am having some success, I fully expect to make six figures in 2009. That's a good salary anywhere, except there's one problem.

My credit still sucks.

I should be able to get my bad debt paid off by the end of the year, but I will still have a crappy credit score. And, I REALLY want to quit my job this year and do IM full time, but I worry that it will be even harder to get credit if and when I am not a W2 employee with a guaranteed paycheck every two weeks.

Anyone else dealt with this, and if so, how did you handle it?
#concern #debt #future #massive
  • Profile picture of the author Teresa Coppes
    CreditBoards is an absolutely fantastic resource to fixing and building your credit. And there's a specific section dedicated to those who run their own business and don't get W2's.

    Good luck to you!
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    • Profile picture of the author purplediva
      I second Teresa's suggestion. I have been a member at credit board for over 4 years. The advice there has helped me increase my credit score about 120 points. It takes hard work and dedication to monitoring your credit score, keeping balances down, and paying off bad debt, but IT IS possible.
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  • Profile picture of the author Jacqueline Watson
    I'm in the same situation.

    Thanks for the info
    CreditBoards...I'm going
    to check them out.

    Peace and Love

    Jacqueline
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  • Profile picture of the author Amy Bass
    I just paid off my debt a few days ago. It took me a little over a year and half, but I paid off $72,900 by making money online. I posted about it on my blog -
    My Debt Free Goal | My Debt Free Goal
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    • Profile picture of the author Nightengale
      Congratulations Amy! That is waaay awesome!

      Michelle
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      "You can't market here. This is a marketing discussion forum!"
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  • Profile picture of the author Dean Shainin
    Originally Posted by sree94 View Post

    Now that I am having some success, I fully expect to make six figures in 2009. That's a good salary anywhere, except there's one problem.

    My credit still sucks.

    I should be able to get my bad debt paid off by the end of the year, but I will still have a crappy credit score. And, I REALLY want to quit my job this year and do IM full time, but I worry that it will be even harder to get credit if and when I am not a W2 employee with a guaranteed paycheck every two weeks.

    Anyone else dealt with this, and if so, how did you handle it?
    The irony is that you will be one of the lucky few who won't have to struggle to pay off more debt in the future.

    It takes about 7 years to build up credit. 10 years for bankruptcy.

    Unless you are thinking of using credit for leverage to use for business reasons I'd stay away from more debt...

    Cheers,
    Dean
    Signature

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  • Profile picture of the author Golelen
    Here are two things that work very well....

    1. Get a copy of your credit report and correct any wrong information, including contesting charges that aren't yours (if any).

    2. Get a credit card (preferrably one that rewards you like a Disney Card) with a low limit. Secure it if you have to. Then charge an item and a couple weeks later pay it off. Keep doing this cycle for several months.

    You can also get a car, make a huge down payment and finance a small amount. Make your payments every month like clockwork. After doing this for a year, pay it off. You'll lose a little to interest over the year, but it establishes that you can pay your bills.

    The irony about getting credit is that the creditors want to see that you will pay it back and living debt free doesn't establish that; it only establishes that you live within your means.
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  • Profile picture of the author purplediva
    Golelan is correct.

    Part of me fixing my credit was getting a credit card. It was something I DREADED because of what I had already done to my credit from my college days.

    BUT now that I am older and wiser, I have been able to use the card with restraint and use it as a tool to better my credit score.

    Paying ontime monthly and keeping those balances low show creditors that you know how to handle your money. You can get a copy of ALL three credit reports FREE at annualcreditreport.com, you can get a free copy of each one every year. It does not come with the score but it does help to see what creditors are reporting informtion and to make sure that everything is correct.

    Jessica
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  • Profile picture of the author Sylvia Meier
    To fix my credit I have been doing the same as the above few posters advise. Only difference, I put the money on the card, then make my purchase so it is being used but never really as credit.
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  • Profile picture of the author davebo
    Banned
    [DELETED]
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    • Profile picture of the author Notarealdoctor
      I've been working with people that have debt for years and the main component you getting your credit rebuilt is cycling your credit. This means use credit to your advantage. Keep your current credit cards that you have open and use them here and there. Don't go over 50% of the available limit and pay it over a few months. I advise most people to buy gas and groceries for a month on a credit card and take 3 months to pay it off. The credit bureaus will show that you can manage your credit. If you have 3 cards, cycle through all of the cards. If you're consistent, you'll always have a high FICO score and you'll never be in a bind for credit.

      If you're going to be an internet marketer that makes pretty good money, set up some type of corp or something like that and run your own payroll. That way you'll always have a W-2 and pay stubs as well. Also get a good accountant and they will help you with your structure so you're not paying tons of tax. I actually use tax attorneys instead of accountants because they will keep you out of trouble with the IRS.
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  • Profile picture of the author dndoseller
    Yes, and I declared bankruptcy and it was the best thing that ever happened to me, even though I am not "recommending" it, since I was in a very extreme situation. The upside is I no longer have any debt and I am forced to live within my means. Everyone should pretend like credit does not exist, with a mortgage being the single exception. I am very grateful to have a second chance since during previous times in history that kind of debt forgiveness did not exist.
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