Credit is King
Next to cash that is. At one time I was able to borrow millions of dollars, and I did. I made our first video game with a huge line of credit we had built from working hard building years of trust with our bank, only to have the plug pulled before we finished the game, thus or investment went bad. Long story short, I miss the good old days of being able to walk into the bank and get a loan for whatever we needed. Operating loan, equipment loan, etc.
In 2007 I planned on getting into real estate. I had read about it for a whole year. I played the game cash flow 101 and 102 every night, dreaming of creating cash flow and getting out of the rat race. I was waiting to get out of bankruptcy. I had talked to my bank, and they said if I had 25% down, it would be no problem. So I had my down payment saved and a house picked out for months ahead of time. I completed my bankruptcy, and go to get the loan, and get denied. My credit score was too low. I didn't earn enough money either. Wow, they basically lied to me, or left out some important details. I figured the house deed would be enough collateral but later found out that banks don't really like loans under 50k for homes. So getting loans on rental properties suddenly had all these hurdles.
I didn't give up though, I kept saving my money and sold some things to get more cash. I talked to various banks and got shot down. It was very humbling and discouraging. I finally got a friend to loan me 9 grand and did the deal. Roughly 9 months later! Better late than never though. I learned a lot on my first deal. I researched a lot about credit repair, but its a slow and painful process. Cleaning up your credit report is not very easy. I sure missed the good guy handshake loans of the past I was able to get. So for my second house, I really had to pull some strings. I got a co signer for a loan and secured it with the title of my vehicle, and that gave me enough money for the down payment and some money to repair it. I also got owner financing. So it took a LOT of effort to put that deal together.
My next house was bought cash with a partner. We gave next to nothing for it but its a basket case. Needs everything, but still will cash flow really well when done.
Today was monumental. Not only was the house we bought probably the best house out of all of them, but I talked the owner (a privately owned bank) into writing up a loan for part of the balance. From what I've learned of the bank, its a private owned bank that has the power of my old bank. They can give handshake loans essentially, so my top priority is to build a relationship with this bank. Maybe they only loaned me money to get this foreclosed house performing again... but I am praying I've found a good guy bank to deal with again. Most importantly, I want to honor all my debts perfectly, to rebuild my credit, or at least, be able to get loans without a credit score getting in the way.
Whats amazing is real estate has put me on the fast track to becoming a very successful businessman, again. I feel like I'm home, doing something I'm naturally good at. Its like I'm a good deal magnet, and real estate has done nothing but improve my life. Its hard work, but I like it. I like working with my hands and buying materials, moving mountains. Fixing a house someone else would bull doze, and then cash flowing excellent on it, because I made all the right choices. Real estate has helped me get credit, helped my relationship with my kids; I used to yell at them to be quiet so I could concentrate on the computer game work, now I put them to work painting or sweeping, and we are much closer. I feel like I'll soon be able to buy a home for me and my girl friend to live in together again at last. All my dreams are coming true rapidly!
In 2007 I planned on getting into real estate. I had read about it for a whole year. I played the game cash flow 101 and 102 every night, dreaming of creating cash flow and getting out of the rat race. I was waiting to get out of bankruptcy. I had talked to my bank, and they said if I had 25% down, it would be no problem. So I had my down payment saved and a house picked out for months ahead of time. I completed my bankruptcy, and go to get the loan, and get denied. My credit score was too low. I didn't earn enough money either. Wow, they basically lied to me, or left out some important details. I figured the house deed would be enough collateral but later found out that banks don't really like loans under 50k for homes. So getting loans on rental properties suddenly had all these hurdles.
I didn't give up though, I kept saving my money and sold some things to get more cash. I talked to various banks and got shot down. It was very humbling and discouraging. I finally got a friend to loan me 9 grand and did the deal. Roughly 9 months later! Better late than never though. I learned a lot on my first deal. I researched a lot about credit repair, but its a slow and painful process. Cleaning up your credit report is not very easy. I sure missed the good guy handshake loans of the past I was able to get. So for my second house, I really had to pull some strings. I got a co signer for a loan and secured it with the title of my vehicle, and that gave me enough money for the down payment and some money to repair it. I also got owner financing. So it took a LOT of effort to put that deal together.
My next house was bought cash with a partner. We gave next to nothing for it but its a basket case. Needs everything, but still will cash flow really well when done.
Today was monumental. Not only was the house we bought probably the best house out of all of them, but I talked the owner (a privately owned bank) into writing up a loan for part of the balance. From what I've learned of the bank, its a private owned bank that has the power of my old bank. They can give handshake loans essentially, so my top priority is to build a relationship with this bank. Maybe they only loaned me money to get this foreclosed house performing again... but I am praying I've found a good guy bank to deal with again. Most importantly, I want to honor all my debts perfectly, to rebuild my credit, or at least, be able to get loans without a credit score getting in the way.
Whats amazing is real estate has put me on the fast track to becoming a very successful businessman, again. I feel like I'm home, doing something I'm naturally good at. Its like I'm a good deal magnet, and real estate has done nothing but improve my life. Its hard work, but I like it. I like working with my hands and buying materials, moving mountains. Fixing a house someone else would bull doze, and then cash flowing excellent on it, because I made all the right choices. Real estate has helped me get credit, helped my relationship with my kids; I used to yell at them to be quiet so I could concentrate on the computer game work, now I put them to work painting or sweeping, and we are much closer. I feel like I'll soon be able to buy a home for me and my girl friend to live in together again at last. All my dreams are coming true rapidly!
posted by Joel Huenink at
12:22 AM
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