Investor · Pukalani, HI · Member since 2017 · 414 posts · 291 votes
I built my credit up from a 570 to an 810 in about 3-4 years. Then this year I Bought my first 3 long term rentals and each one I buy comes with 2 hard hits on my credit (I haven’t even refi’d any of them yet, I’m trying to accumulate a lot of equity and reinvest it to maybe a MF or other higher price property). I’m Working on #4 now, and I’m wondering for the guys that have BRRRd or even just bought a lot of properties w mortgages, how does your credit hold up once you have 12, 15, or even 20 hard inquiries on your credit?
And also acquiring all these new loans brings my average age of credit history down quickly. I was at 7 years average age and 2 hard inquiries, and now I’m at 3 years and have 8 hard hits so far. My score is still around 785, so we’re good so far, but it has slowly crept down as I’ve done each deal. I know they’ll fall off after two years, but still if I’m doing 3-5 a year I could easily have 20+ hard inquiries on my score and 1 year average age of account.
Look forward to hearing from more experienced investors and how their credit has handled their success!
Great job on building your credit score. Anything over 760 will get you the best rates on loans. Yes the hard inquiries will have a minor hit on your score. Usually a point for each depending on how many. We try to use the same lender on our BRRRR refinances so that way they only run the credit once a year. Eventually you will need to use multiple lenders as you will max out the ability to borrow from one bank
Great job on building your credit score. Anything over 760 will get you the best rates on loans. Yes the hard inquiries will have a minor hit on your score. Usually a point for each depending on how many. We try to use the same lender on our BRRRR refinances so that way they only run the credit once a year. Eventually you will need to use multiple lenders as you will max out the ability to borrow from one bank
Great job and keep up the good work..
Hey thanks Kenneth! Wow once a year would be great! I've used the same lender a few times and every time they still pull my credit when we open escrow and then again right before funding. But if it's only going to take 1 point for each inquiry that doesn't really matter, because like you said I still have a 25 point cushion before I fall out of the best rate category.
Kenneth how have all the new accounts effected your credit? I knowing having a lot of accounts will help your credit, but opening new ones constantly will keep your age of credit history down.
Thanks Greg. I use commercial financing so my personal credit is not effected by the loans. I think you would be more impacted if they were revolving accounts (credit cards).