I am a Canadian/American dual citizen.
I have VERY good credit in Canada.
I have NO credit in the USA.
I have great income in Canada and no debt.
I have no income in the US other than recent rent revenue from properties
I chose to invest in the US because that is where I plan to retire in 10-15 years
So I purchased 4 properties (all with cash). 3 of which are single family homes being rented and with reasonable cash flow. The 4th property is simply a strategic land holding.
So here I am with 3 solid properties, all generating rent revenue...….ready to start BRRRing ...and the banks and mortage companies won't lend me any money to keep moving :-(
Their reason...I don't have credit in the US...as in NONE...no score.
One of them said I should get a small secured credit card and exercise my credit for a few months and reapply...(I don't believe this will work...I mean, come on... a few months of tiny credit purchases? Am I wrong...perhaps this will be the key?) That's the same BS the bank told me when I was 20 yrs old and got turned down in Canada for a small car loan.
One of the banks said that I would not be able to get ANY of my properties financed because I had no US income beyond the rent revenue (and less than a year with those).
All of this was very disappointing as I never read any of this in the BRRR book. I thought it sounded easy. Buy property with cash, reno, rent it, refinance. Didn't realize credit or employment income would be a factor
I thought it was elementary as I have good solid properties...no debt other than the regular stuff that comes with prop ownership (Taxes, Insurance, Prop Mgmt).
Not sure what to do
Any tips would be appreciated
Hey @Darren P. ,
Where are your properties located? Traditional banks would not be able to help you, but private capital groups might. I have a friend works at one and might be able to help you.
You do need to get a credit card so you can get a credit score. Shouldn't take too long. if no one will give a card then you need to get a "secured card". your score will be good enough in no time. your lack of income though, is whole different animal...
Originally posted by @Mogo Green :
@Daniel Y. I have 2 property under contract need help closing deal
Feel free to PM so I can get a few details to pass along to my buddy to see if they can help you.
@Darren P. You are going to need to get a US dollar credit card that reports to the bureau in the US. Some prepaid CC don't report, so make sure they do. You can check with TD and Royal Bank in Canada to see if they will refi your US properties, as they have cross border branches. Another option is to see if the US banks will allow a letter of credit from the Canadian banks, as proof of financial stability. The last idea I have is to see if high net worth clients departments via National Bank/CIBC/RBC will be able to help you. If you need a contact at those, message me separately.
@Darren P. I had a client go from 600 credit scores to 720 in 3 months by taking out a secured credit card... so don’t be deterred lol. I also have a friend that works at a bank that could get you a foreign national loan in the 5% interest range to help you out.
@Darren P. You are off to a good start. Stick with what is working. BRRRR is a technique, but is not required to continue to build your portfolio. I would sell the land, because it doesn't generate income, and purchase more SFR rentals for cash. I would not jump through hoops in order to play the bank's game. As of now, you are in control and you keep 100% of your rental income. You are seeking to partner with a bank and share your profits with them? No thanks. In 10-15 years when you are ready to retire, you could have 10-15 houses free and clear.
There's like million ways to build credit in the United States. Capitol One, Chase, Master Card, Discover, American Express, Lowes card, Home Depot card... pick your poison. You should be able to build credit and solve your problem.
@Darren P. There are also ways to become an authorized user on someone else's card and "borrow" their credit history. I've had several clients do this with either a family member, friend, or pay for like on credit card marketplace. I can't speak to the timeline or exact logistics, but check that out:)