Credit score of 400 plus..

36 Replies

Maybe you can work for some other investors in your area?  Drive for them, do some door knocking, appointment setting, some other part-time stuff that they need done.  Start chipping away at it, and learn while you earn.

Originally posted by @Mark Sewell :

Maybe you can work for some other investors in your area?  Drive for them, do some door knocking, appointment setting, some other part-time stuff that they need done.  Start chipping away at it, and learn while you earn.

 The Beginning of your statement sounds like bird dogging but i get what your saying.

and overall these are some great advice and all these apply to all of those that have this same problem right now, i always believed that  trying to get loans searching online or asking around which isnt a bad thing to do but the likely chance of someone getting a loan to help them out with a credit score this low is unlikely as some of ya said, so there is only one way to do that and that is to work and pay the debts off, mainly the utility bills that need to get tended to especially if you wanna live in your own space again, or if its for the first time.

We all had some unfortunate circumstances in life, Death in the family, force to get bills put in your name by someone so they didn't take the blame of not dealing with those bills themselves, and that's someone you don't wanna live with trying to push everything on you  and make it your responsibility, sad reality but at the end of the day it gonna be your responsibility anyways later on. So if you dont want to be in this situation, work and pay off the debts regards of how your situation was before. It will be a challenge but it will help in the long wrong say 5 years from now if you stay the course Financially.

In my case i worked few jobs and i knew i had to pay my debts off, im still paying them now, at one point when i was ready to pay but couldn't pay because my check wasn't a lot and company's wanted me to pay the whole bill off i couldn't do that, some people will run into that problem, if you got a cable bill that some cable provider wants you to pay off the whole bill you can do that all you have to do is save up into the next week depending on how you get paid at your job weekly bi-weekly.

Again it's only one way to get your credit score up if its lower then in the 400s or lower, working and paying off the debts.

I will rush to fix my credit score pros.

Real estate is an amazing socioeconomic elevator.  It can lift some one out of the middle class into the upper class within a few years.   The middle class in the US is defined by having loans / credit to supplement your quality of life, like a house and car purchased with loans.  Where as the Upper-class uses loans /credit to generate income like investments and assets that cash flow. Real estate is good for that 2nd step in claiming the ladder of wealth out of the middle class.   It is not as helpful in getting to or skipping over the middle class. 

There are many good "step one" paths up in life we all can take before starting in real estate. The us military is amazing. Stable income, health insurance, free collage, and The 0 down VA home loan that can be used on a building with up to 4 units. (owner occupying at least one unit) This is the path I used to get out of the poverty of my childhood.

Other amazing paths are skilled labor that require and have built in apprenticeship programs.   They are critically understaffed today. Millennials like my where all encouraged to attended collage and overlooked skill jobs.  If you have a pulse, you can land a job in thees fields today. They often have the power of a workers union behind you too which insurance better compensation than in most other jobs.  With the high pay you can fix your credit and be on your way to investing.

lastly, Real estate does have a step one.  Whole selling with out advertising budgets.  This type of real state allows you to land a contract to purchase a home and sell that contract to a investor.   But with out cash advertising, you will spend a lot of time driving around, cold calling owners, and networking.   It is hard work.  

Most people find that a W-2 job is easier than whole selling with out cash to fund advertising.

I would be putting investing on the back burner. Starting without a solid employment income is a recipe for failure. You simply can not invest without cash. The best thing you can do is move. If there is no employment where you are go where the work is. There are locations all over the US where jobs are available. There is no reason for anyone to be unemployed.

Work for 3-5 years for the same employer, get your ticket, establish your credit and save every penny you can.  At that point you can consider investing in real estate.

The reality is that financial awareness is necessary to be successful at investing. This requires th eability to hold down steady employment, save money, live frugally and build your credit.

Ok so you’ve been beaten to death over credit and jobs. That’s slow and frustrating, I get it, but all sound advice. There are many actions you can take to improve the score very quickly if you look into them.

I’m going to say that there absolutely are things you can do now in real estate to help you start getting on track. I’m buying a deal right now where the wholesaler selling it to me is going to make a $30k assignment fee.

Go find yourself a deal like that and use that money to pay your debts and clean your credit. It can and will happen much faster than a second or third low paying job.

Just hustle. Deals are out there. Are you going to get the next one or will someone else?

I understand where you're coming from.  If you're currently bogged down by student loans, please request being put on an income-based repayment plan and consolidating multiple loans (if you have more than one of course).   If you are unemployed, request a forbearance/deferment.  

If you have a job and get put on an income-based repayment plan, pay more than the minimum, as most of that will go towards interest, not the principal.  This has already helped me a ton in the past two years.  Also, if you can, get a second job or some kind of side hustle (legal of course, like cleaning common areas, cutting hair, cleaning homes, etc.) and use that money solely for paying of debt OR saving for a down-payment, making sure you put it in a high-yield savings account, so it can grow interest while it sits in taking anything out of it. 

Hope this helps! 

Like @Derek Carroll mentioned... you don't need another post about fixing your credit and getting a job.... but I think the folks that tell you to forget about real estate investing for now are wrong.  A lot of the greatest things in life are a result of timing... many people have met the love of their life because they happened to be in one spot at one given time.  Folks have landed great jobs because the right person left the right job at the right time, opening the door for them... my point being, if you forget the real estate game, you may miss the opportunity to get in that would be the right time for you.  Everyone has done it differently and in my opinion the folks that post the most on the forums are the ones the success has followed a more solid and strategic path... get a high paying job, cut costs, save, etc... all of these are good things, but for some the hill looks too big to overcome.  You don't have to take someone else's path... you can make your own.  Find a way to do all you need to do, while staying in touch with the game... don't set it aside.... many things in life that are set aside, never get picked up again.

Agree with @Wayne Brooks . Don’t worry about investing fix the score first. There is so much more you can do once your score is above 600.

I know people say you don't need money to get into real estate... you also don't need shoes to run a mile, but it helps.

You can't get a loan without a job or other way to pay it back. Period!

I wouldn't lend a penny to a friend or family member that wasn't out there busting their back side off trying to get ahead. My nephew bought a new car and it got repo'd. He didn't have the money to get it back so he bought another car (only a few years old) from a tote the note lot and it got repo'd. Again, he couldn't afford to get it out. He called and wanted to borrow money from me and I said no. I told him you keep making bad decisions and I'm not throwing my money away. He had some money saved so I told him to go buy a crappy used car for maybe $2,000 and pay it off before even thinking about getting something better. He didn't listen and now has a used car he pays $150 a week for. His credit is still really bad and he still has the same job that barely pays enough for him to get by. Nothing has changed in the past couple of years.

Make better decisions and you get better outcomes.

My first car was a '68 Ford LTD back in 1981 that I paid $500 for. I made $4.50 an hour back then. It didn't have A/C. Imagine driving that in the Texas heat? I mounted a small fan on the dash and sweat a lot.

I did just the opposite of my nephew when I was his age. I worked and put in all the overtime I could. I drove a beat up old car and did most of the repairs myself. I saved money and paid cash for almost everything. I got a secured credit card and charged a few hundred on it at a time and then paid it off to build up credit. I cut my grocery bill down as much as possible and didn't go out to eat but maybe once or twice a month. I put myself on a strict budget and if I didn't have the money, I had to find ways to have fun that didn't cost anything (having friends over for game night, going to the park, renting a video, etc). Eventually built up enough money to get a better used car ('74 Orange Chevy Vega i bought from my sister in 1986) and went to college part time. Got a better job, was able to save more, able to have a little more fun, etc... It just takes time and a lot of hard work and discipline but it can be done.

Account Closed

There are many factors that affect your credit score, but lack of income generally isn't one of them.  I know plenty of people that don't make a lot of money that have outstanding credit.  However, lack of income can be a roadblock to building credit if you can't get a loan, credit card, or don't have money to pay your bills on time.  

First step is a job.  A conventional lender is not going to loan money without a steady stream of income.  Next is to pay bills on time, every time.  Getting turned over to collections is a credit killer.

Then save money and keep debt-to-income ratio low, at least below 36%.  Don't spend money on things you don't need.  Creditors like to see you're capable of saving and managing the money you're bringing in.  

Building good credit is not difficult, in theory.  But there are no quick fixes.  It takes time and discipline.  Also two things you need to have when investing in real estate.  

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