Should I agree to be the credit proxy for my parent’s flip?

[Dylan Salem]

Hello! I am a freshman in college majoring in real estate and I got inspired to pursue a career in real estate because of my mom, who was a successful realtor for a very long time. Unfortunately, the family business recently shut down and caused my parents to go into bankruptcy in 2020. Because of this, my mom’s credit, which has been near-perfect all her life, is now not high enough to secure a loan from a private money lender to finance a flip she is very eager to do. I have a credit score of 700 and my parents are forcing me to become the credit proxy for this deal. Obviously for an 18 year old, this is a huge situation which while I am grateful for the opportunity, I am understandably weary. If this project is a success, I will be given a share of the profits and my score would boost tremendously. But if it fails, I would not be able to engage in real estate investing, and much worse. Even though they are forcing me to comply, I want to know if I am wrong for being weary about this, and if not, what can I do to make sure this all goes right? A response would very appreciated, thank you!

[Jeff S.]

Find another hard money lender.  These are not conventional loans and many private/hard money lenders do not require a credit check.  Of those that do, even fewer actually report to the credit bureaus.  The successful completion of a flip will not boost anyone's credit score.

Credit should not stop your Mom from being able to flip a house.