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So basically I ruined my credit about 5-6 years ago. Then when I went to college I didn’t have the money to establish any new lines of credit. I recently graduated and have started a 80k a year job (before taxes). I was able to secure a credit card with a low maximum ($ 500) which I have been making SMALL purchases on never letting it go over 50% of the total maximum and paying most if not all of it off every month for 3 months now. If I follow my budget I will have saved enough in 2 years to buy a house. Will my credit be good enough by then to buy? it’s in the high 500’s now. I was also thinking of buying a used car no more then 15k prob 10k. If I paid this off in 2 years would that help my credit? I’m not to worried about paying extra in finance charges if it helps my credit to buy a house. I have read almost every document on fixing credit and I am on the right track. Also I have checked my credit took off all inaccuracies and know that 6 out of the 7 bad items on there will be gone in a years time. So basically what I am asking is what will my credit score be in 2 years? Has some one been in the same boat as me, what was yours in 2 years?

Thanks for the help!

3 Thoughts on will I be able to fix my credit in 2 years?
  1. Reply
    October 31, 2011 at 12:37 pm

    In two years, if you keep on track, should be good enough to get a mortgage.

  2. Reply
    Use Your Noodle
    October 31, 2011 at 1:01 pm

    If you do as you have planned, 2 years should be sufficient time in order to get your score up enough to purchase a home.

  3. Reply
    Matt Wegner
    October 31, 2011 at 1:02 pm

    Hi Joe,

    If you’re paying your bills on time the credit score will improve in 2 year. Consider this, though. The credit score is only important if you’re planning to borrow money. You can’t borrow money without it, yet you can’t have a good score without borrowing money.

    I personally wouldn’t bother with a car loan because I don’t borrow money anymore. I’d save up and pay cash for it. Getting a car loan means you’ll go deeper into debt so you can have a slightly better credit score so you can later go deeper into debt. When you pay cash for a car, you’ll have more cash flow in your budget to save up for a down payment on the house. A larger down payment for the house will save you much more in the long run than any interest savings you’ll get from the higher credit score.

    If you go to a smaller bank that actually loans their own money and does manual underwriting, you’ll be able to get a mortgage with no problem. These are typically the small town local branches that have their headquarters near you, not thousands of miles away.

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