Creative Financing: Is there hope with a 430 credit score?

Question

Hey BP! I am new here and loving all the wonderful information. I am struggling to figure out if creative financing could be an option for me to fund my first investment. I currently have a 430 credit score and student loan and inherited debt. So traditional routes are just not an option. Initially I was thinking fixing my credit but that looks like it will take years and recently I have considered wholesaling as the road to building the funds to finance buy and hold.

I am very new to REI any insight as to what route might be best for the fastest way to raising a down payment.. credit repair? wholesaling? or type of creative financing? I would love to invest in my first buy and hold towards the end of 2017.

Thanks so much for reading!

Lorraine G. · Answer

@Robin Wilk I love the way you think! I realize that this makes perfect sense. I can do all three. It is most likely that I should begin the credit repair process first and branch out into wholesaling and creative financing options as I gain more education. I had a bit of what I think is called analysis paralysis lol but In doing all three it eliminates the frustration in trying to pick just one route and also very empowering. Thanks so much! @Brandon L. I agree. Having a good credit standing will be such a great asset. I am going to take your advice put my focus on improving my credit, increasing my knowledge and building my network. I am reading your blog today and will be sure to ask any questions in the comments! Thanks so much for your guidance!

Brian Garlington · Answer

@Lorraine G. Anytime!

Lorraine G. · Answer

@Michael Williams Your advice has added more perspective for me. Education is key and like so many others I initially had my focus on a fast start over preparation and the slow and steady theory! The Education offered here is beyond anything I expected and I decided to go pro to benefits as much as possible! I will be checking out Cody Sperber also! Very excited and looking forward to acquiring better a financial and REI education!

Lorraine G. · Answer

@Brian GarlingtonThis is AWESOME!! Thanks so much for the info on John Bryant's Operation HOPE website! I will surly look into this! Also really appreciate the "first of many" line! lol That is exactly what I'm aiming for. I am going to find a few articles on the FHA loan process and benefits and really appreciate you pointing me in that direction! Thanks so much!

Brian Garlington · Answer

Lorraine G.Welcome to BP! Definitely start listening to the podcasts and reading the forums. There are also a couple of books you can get here on BP written by Brandon Turner. One is called The Book on Real Estate Investing. The other is How to Buy Property for No (Or Low) Money Down. Last but not least, Check out John Hope Bryant's Operation Hope Website. He works with lots of people and helps them raise their credit scores by 100-120 points.When you do get your first (of many :-) ) properties consider getting an FHA loan. Only requires 3.5% Down and you can use it to purchase a duplex/triplex/4plex. 75% of The rental income you get after two years will count as your income toward the purchase of additional properties.Welcome!

Brandon L. · Answer

Lorraine G. if you plan to have long term success in the real estate industry credit is an important factor. Start working on your credit today. I recently did an article on this for the BP blog the link is below:https://www.biggerpockets.com/renewsblog/2016/07/1...Most people over estimate the amount of time it takes to get a credit score in shape.The best thing you can do now is focus on increasing your knowledge, raising the credit score, and building your network.

Michael Williams · Answer

Hi Lorraine, I understand the frustration, but you've come to the right place. First put the idea that you have to money or credit out of your mind for right know and focus on educating yourself on the real estate investing business. Go to the top of this page and hit the education tab. Everything you need is there. There are also some free information from national investors that provide free and paid information. Cody Sperber has a vast number of videos on Youtube and his website. Read everything you can while you look for deals, Education is the key.

Robin Wilk · Answer

You could essentially do all 3 really. Let me explain you can get started wholesaling to create extra income that will help you pay down your debt thus fixing your credit score. You can also use creative financing to help fund your deals such as seller financing where the seller is basically the bank in essence. You can also work with lease options aka rent to own. There are many resources available here to help you out. If you have any other questions feel free to ask them here. I've been here just over 3 weeks or so and I've gained enough knowledge to last a lifetime or two.