Credit Question...Why is this?!?!?

Question

Me and my fiance pulled up our experian credit scores and reports.

I have $13,000 in closed way past due debt. I havent made a single payment on any of my open accounts.

He has $19,000 in debt, $15,000 of which is still open and we are paying on (car loan).

He had a previous car loan a couple of years ago. He voulentarily turned the car in, and after I think a year he paid the balance, and it shows on the credit report on the car loan that its paid off.

He also made payments on that car before it was voulentarily repo'd for about a year on time.

My score is 515. His is 510.

Why is his less then mine when I obviously have worse history??? Ugh I hate credit.

How long will it take to raise his score a few points if we are making car payments on time. How long till we see a raise? We just got the car 1 month ago.

Answer 1

His credit is worse than yours because the date of last activity on his bad accounts is more recent than yours.

It works like this:

After 12 months of doing nothing on bad debt, the effect is reduced a bit.

After 24 months of doing nothing on bad debt, the effect is reduced substantially.

However, if you go 8 months on bad debt and then pay it, that restarts the the whole ordeal again. It is like it just happened.

What your husband did is restart the 12 month window. What you have done is left it alone and have perhaps moved into the 12 month/24 month window.

Your credit will never be good until you take care of these debts somehow (or just wait until they cannot be reported anymore), but if you pay your car on time there is no reason you could not be somewhat better in your credit scores 11 months from now.  

Answer 2

You're worried about a 5 point difference?  Both scores are in the toilet - it doesn't matter.