I destroyed my credit last year. Like many others, I let the Christmas season and my lack of immediately accessible funds drive me to do the unthinkable. I went into debt. I used an Amazon.com in-store credit card to make sure my son had a good Christmas morning. That wasn't my only reason for getting the in-store card, but my plan backfired.
My credit wasn't great to begin with, but it wasn't horrible. I had a credit score of 601. My problem is actually that I have a lack of credit rather than a lot of bad debt. I don't buy on credit because I normally operate under the assumption that if I don't have the money for what I want, then I must not need it. To that end, I feel some pride in knowing the difference between wants and needs.
I had decided that it was time to buy a home. I knew I had to build that credit score and the only way to do that is to open a line of credit and make timely payments. Since I didn't need a car and Christmas was right around the corner, I thought the Amazon.com in-store card was my best chance.
I bought a house the following January. Since I bought it on land contract, credit was not an issue. I thought I had the best of both worlds. I was timely with my payments on both at first. That's when all of my money got sucked into my house and the non-operating water pump followed by leaky pipes and a whole slew of other issues.
I got a great deal on the house, so I have no regrets about that. My credit score has dropped significantly and I am still sinking money into the house. The sound of hollow laughter would follow me out of the bank if I asked for a loan. I would like to say I learned my lesson, but my intentions were well founded. Since I won't have a house payment after I pay the house off this year, I will have the funds to build my credit back up.
I could file bankruptcy I suppose, but I made this debt and I want to do the right thing and pay it off myself. I anticipate long conversations with creditors in the hopes of reducing accrued interest by paying the loan off in a lump sum.
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