Good Credit, Bad Credit? It’s really about the value of the property.

value of the property not credit

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The fact of the matter is that in today’s economy there are a lot of good people that have credit scores that are anything but good. We realize that these are good people and they’re getting ignored just because of events that happened, some within their control because of a a decision they made and some beyond their control.

What if somebody with bad credit is trying to get a rehab loan? There are some hard money lenders who care about credit, but if they have credit score requirements then they aren’t a true hard money lender, they are more of a conventional lender. True hard money lenders fund deals based on the value of the property, not the borrower’s credit. One of the great things about being a real estate investor is that you can find great opportunities even if your personal situation isn’t that great. There are lots of private lenders that are willing to lend to you regardless of credit. You may ask yourself “why in the the world would someone regardless of what my credit score is?” and the answer is really simple.

It’s not about you it is about the value of the property. A hard money lender only cares about the value of the property, and they are willing to fund deals for those with poor credit because they can use the property as collateral.

So don’t stop because of bad credit. Is it a challenge? Absolutely. Will it hold you back? Not if you’re willing to put in the time and work to find great deals. It can even be an advantage, when you think about it. If a hard money lender won’t fund the deal because they don’t see it as profitable then it is like a second set of eyes. A deal funded based on your credit might not look as closely at the profitability of the deal.