In the REI group meeting a week ago there was a lender there who advertises $50k to $200k personal lines of credit, to be used for anything - closing costs, fees, even the entire purchase price for a property. There is a one-time 15 point fee for establishing the line of credit spread out over 5 years. After that it's 10% interest for every draw against the LOC, again spread out over five years.

However, that is not all. After the lender reviewed my credit report, which all three bureaus rank me at above 750, the lender representative told me that all of the inquiries on my report prevent them from lending to me. HOWEVER, for a fee of $1200, payable up front, they can erase all of the inquiries from my credit report. Admittedly I do have a large number of inquiries resulting from two cars I purchased last year and the hard money lenders that I have been applying to recently.

I told the lender representative that I feel uncomfortable paying such a fee upfront if there are no guarantees. First, there would be no guarantee of them actually wiping out all of the inquiries, and second, there is the risk that they still will not establish the credit line for me after the credit work is done. On top of this, they will extend the credit to me personally, but not my corporation.

Now that I am typing this, I am wondering why the lender would take the time to erase the inquiries. If they extend the credit line to me, they would know that all of those inquiries were there in the beginning anyway whether or not they have automagically erased them from my report.

The lender rep is very persistent and I am still having conversations with him about this.

A credit line would be very helpful, especially with my first few deals. It would also be great to get those inquiries off my credit report. But, I do not want to fall into a scam trap.

Thoughts???