Can I qualify for a mortgage if Ive never had a loan of any kind?

[Matt Meyers]

I have good credit, but have never had any major loan of any kind - car loan, student loan, anything. I'm 24yo and hope to buy a house hack in California in the next year or so. I'm hoping to put low money down through an FHA loan but am realizing that I don't have any serious credit history other than no credit debt and a high credit score (haven't even had a credit card for very long). I am pretty thrifty and don't like the idea of putting myself thousands of dollars into debt for a new shiny car not to mention taking on an additional monthly payment that I can't afford (I live in Santa Cruz and cost of living alone is ridiculous), but realize that lenders may not take me seriously when they see that I don't have any loan history already.

Will that make things harder for me when it comes to getting a mortgage/hard money loan for a house?

Thanks!

Matt

[Parker Larsen]

Hey Matt,

Fellow Santa Cruz real estate investor here. If you are going to be pursuing real estate seriously then you should start trying to build your personal and business credit ASAP. It really helps with obtaining the right lending rates and also can become an asset when used in conjunction with your business credit for future acquisitions. I highly recommend checking out a local credit union in the area and getting a small personal loan that you put on auto pay. When I was doing this I used Bay Federal Credit Union in Aptos and took out a bank account secured $500 loan with a 24 month pay period. The interest ended up being nominal, something around $35 and putting it on auto pay ensure you don't miss a payment. This step is critical...you want to show the banks you're capable of not missing payments even though the loan is a small one. PM me if you want more details on this process!