Real Estate Investor · new york · Member since 2008 · 25 posts · 0 votes
I first want to thank everyone from newbies and experience people. I just joined while surfing around this site several times. To get my feet wet,
I am taking about 6 month to a year to study, research.
My goal is to buy property for rental income cash flow. I will live in my NY parents rents subsidized apartment.They moved out.
Question:I only have 16,000 in savings but really bad credit and 30,000 student loans. Bank reject me for small loau
what direction I should take? by property outside NY? too expensive for proty manager?
I will search through this site. I appreciate any pointers. I hope to one day be an influence to my friends in the real estate world.
based on what you have said so far your debt to income along with your credit score sounds like you may not qualify for a loan, especialy an investment loan. What is the current interest rate on your student loan? do you have any credit card debt? I really think you need to address the other issue of your finances and get your credit score up first. If you can qualify for a loan, buy a duplex and live in one half. That's a great way to get started.
Tips for increasing your score:
1 pay off credit cards but DO NOT CLOSE THEM
2 don't apply for any new credit
3 NEVER apply for store credit (ie dept store cards, home depot)
Real Estate Investor · new york · Member since 2008 · 25 posts · 0 votes
19y
so far thanks for the tip. yes i have credit card 970.00 . i can and will pay it off in large chunks. i just dont want to s. planning to use the money for deposit but i am reading everything from this site for insite.
Real Estate Investor · new york · Member since 2008 · 25 posts · 0 votes
19y
so far ]thanks for the tip. yes i have credit card 970.00 . i can and will pay it off in large chunks. i just dont want to spend what i have , the 16,000. planning to use the money for deposit but i am reading everything from this site for insite.
thanks for the tip Austin.
Good discussion. Good tips AustinRealtor.
1. Untill the time u cant pay off ur credit card in full I heard that if u r keeping any balances on ur credit card make sure it is lower than 40% of ur credit limit o.w it starts looking really bad for ur credit history.
2. Also if they keep on increasing ur credit limits thats not a good thing either......but Im not sure how tru is that.
3. The other thing that will help u is if u have a credit card from a long time to use it for a little bit and pay it off in full the same month........it shows that u could carry a card responsibly for a long time and also pay it off on time....good thing.
Real Estate Investor · London · Member since 2008 · 3k+ posts · 74 votes
19y
1. Credit scores indicate how well you are at managing debt/credit. If you have no credit or very low limits you will have a lower score than a higher capacity that you have handled well.
2. Pull your file and get all the mistakes sorted.
3. Try to keep the debt to 40% or less if you want to optimize the your score. Paying it off is good but sometimes having a bit of debt outstanding will actually raise your score. The marginal difference is small so the cost of having a balance that you could pay off is not worth the extra points.
4. If you are behind or if you have defaults on anything figure out how to get it sorted. Before making any payments on a charge-off you need a plan. The reasons is the bad marks will look like recent ones if you make a payment. Best is to negotiate a settlement and then have the item removed. The lender agrees to remove the item if you send in a lump sum to pay it off.
There are credit advice forums that go through a lot of detail on how to handle bad marks.
It takes a while for bad marks to get corrected and the score to respond. You can get a second job to build up a deposit. Hence the cash might be best used to sort the credit now and let time work its magic.
You should really consider paying off your credit card debt, ASAP. You'll most likely be paying at least 14% for that money. So by paying it off you're making a 14% return.