Business Owner/Investor · Millersville, MD · Member since 2015 · 191 posts · 71 votes
What can I do?
My scores are in the very high fives, to low 600s. I am officially paying off the last of my collections this thursday, and then Ill be collections free, and I can be debt free in less than 6 months after.
I really want to continue expanding my businesses, as well as expand into RE, with a more heavy emphasis on RE than my businesses until the previous and current acquisitions stabilize and the dust settles.
I wont say how much I make, just that I have the cash flow to very easily put down 10 and 20% down payments on houses every two weeks with ease.
I really want to expand into RE in the baltimore area, fort meade area, Joint base Andrews area, college areas across the US, in Tennessee, and in Texas.
I will show you what I've bought later this week so you get an idea of a starting point anyway. If you're well financed you can offer low prices with a 10 day close, no contingencies. You should have enough padding built into the deal for anything that would have been found in an inspection, you're already at the bottom dollar so the home inspection is no longer a negotiating tool. Better to just close - landlording is the business of time. For multifamily that's sat on the market for several months the owners are thrilled. But you have to use judgment and can't be too cheap or you find yourself taking forever to get a deal, sometimes you have to pay a little more to keep the machine moving. I usually average out the last 90 days actual rents collected, divide that by .016 for a starting point and then manipulate that number based on how good/bad the property looked at the showing. Authority Settlements in Urbana can close fully insured titles FAST! We went to contract on Friday for a 3 unit building and we close Wednesday.
That sounds fantastic. I look forward to seeing that
Im extremely interested in multifamilies, so thats definitely something I want to learn more about. They seem to cost a bit more, but seem to have a better built in mitigation factor for stability of income.
You may be surprised how quickly your credit score can rise. @JR T. beat me to the punch with his suggestion. I would ad that once you clear you debt and have some free and clear property I bet is will not be hard to get a credit line based on the free and clear property.
If you are interested in credit repair, let me know and I can refer you someone. They work nationwide. Credit is based on a multitude of variables and you just might fit in the bucket of people whose credit can be "repaired" or "restored". Many of these companies are not credible, so beware; obviously you don't know me so if you asked me for the referral I'd say listen to what they tell you and use your common sense. But it still probably helps when a real person is willing to recommend someone....at least that's what I'd think.
When you have large cash flow (compared to your overall debt), rebuilding or fixing your credit becomes reasonably simple. It is not easy to fix everything but you can rapidly build up your credit score to a decent level. Get a secured credit card. There are numerous banks or credit unions that will do a secured card with pretty horrible credit. Buy a new car. Put 50%-75% down and finance the rest. Trust me, with that level of LTV they will do it. Try and get a card with Fingerhut. Very liberal with giving out a low credit line and if you use it, they will increase it. With a few of these lines of credit your scores will rise significantly in a limited amount of time. If you have a lot of recent, derogatory credit this won't always bring your scores up as much as you would like until time passes and some of these things fall off. There are lots of other factors and possibilities so don't take this as comprehensive.
@Bill HamiltonDefinitely good advice here. I actually opened a secured credit card a while ago, and increased the credit line to 12.5k, which is pretty ridiculous according to most bankers.
I havent missed a payment for a year, got several small secured loans (secured by cash) and other smallish loans (secured by collateral).
I still only have a 580s to 610s range though. Paying off my last two collections this week, or early next week, and Im hoping my score will reflect a noticeable increase after that.
Mostly I think its due to my payment history, which is in the 80s and 90% PoT range. Secured lines are slowly increasing this, and as time goes on and my missed payments are falling off into the beyond 2 years range, its going up, I just wish I knew of better ways to do it faster.
At this point I dont really care what it costs, the amount of opportunities, and the value of those opportunities are costing me millions at this point, so if there was a magic button to mash, please, by all means, show the way.
There is no magic button. But there are strategies. Sadly, I will tell you that paying off collections can often hurt your credit score rather than help. I know it's counterintuitive but it's true. As a general rule of thumb if the collection is more than three years old, it will actually hurt you to pay it. but sometimes it is needed to avoid a judgment (which will really hurt your scores). If you want to PM me, I can chat on the phone with you. Some of these things just get too long to type, and they are all based on your individual credit report. Just for the record, I am not going to try and get you to pay for any advice on these things. I am not licensed to do so and am simply offering my opinion for free, based on experience and anecdotal evidence.
I know that if I can be added to people's credit cards as an authorized user that I would have a substantial increase in my score.
Id pay a pretty premiums (at least 20%) for something like that, especially if they had 10+ years of perfect payments on it. It would immediately give me like 150+ points according to a lot of people. That would put me in the money.
@Logan Hicks it sounds like you are doing everything right. If you have not already done so get a copy of it so you know what to work on, and to take to a professional if needed for advice. If you have a house or 2 free and clear you might get a smaller local bank to loan you say 50% on a paid off house. Even with a bad score they will see that as safe. It might cost you a higher interest rate until tings improve.
I have been out of the credit/loan game for a while so I won't disagree with the authorized user thing, but the last time I paid attention, I heard they had pretty much closed that approach. But that doesn't mean it's true. It used to be an incredibly effective way of raising your score. I am curious now so I will check into it with the sources I know, when I get a chance.
Don't ignore the elephant in the room. Your major limitation is the quality of your credit. You need a specialist who will look at both the removal of negative items and help you build credit. Authorized user is not the answer. You need your own credit with high limits and you need it now. You also need the proper mix of credit. You don't need to apply for credit and be turned down which would drive up your inquires and lower your score further. I own and operate a credit enhancement company and will help you if you call me directly. I will provide a free consultation since you came to me through this forum. You will need to provide a copy of your credit report. I can be reached directly at 724 664-6078.
To answer to your authorized user question Bill is mostly correct. It is rare to see a huge jump in score since they have changed the scoring algorithum. They are many complexities to the formula but let me see if I can simplify it's approach.
If you add an unbelievable trade line such as an 18 year old adding a 10 year old line of credit with a limit of $20K, no points would be awarded. Conversly if you have a person with the same last name add you to a trade line which fits within the realm of your former trade line limits, you will get a considerable bump in score. The key is to keep it consistant with former trade lines. So therefore buying a large trade line with a lot of history and a low balance-to-limit ratio works for only a small percentage. Furthermore the algorithum now awards points slowly (even if the trade line is consistent with your past history). In other words no large increase immediately, however the score will begin to push up after 4 - 6 months.
My information is based upon several former employees of the credit bureaus and one expert witness who has testified before congress on this topic.
The low credit score you've earned didn't happen overnight, nor will it be 'fixed' overnight.
If the old bad debt you are satisfying is really old, they may settle for less AND they may agree to removing or otherwise not reporting any additional negative items.
I saw a reference to Fingerhut and the like. They are about the biggest spammers and junk mail folks around. Others are, too. You will never get rid of their fingers out of your hut!
Pay things off, save money to buy property outright, let your credit heal, then refi out. A lot of these suggestions sound like a lot of work and a lot of trouble. Patience goes a long way @Logan Hicks!