Tag Archive for: usage loan

Help! I Can’t Get a DSCR Loan Because of My Credit

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Help! I Can’t Get a DSCR Loan Because of My Credit

Many investors are struggling to get a DSCR loan because of their low credit score! However, there is a magical solution that can easily solve this problem. It is called a 911 usage loan! Here at The Cash Flow Company we help people raise their score so that they can get the loan they need. On average we see 7 out of 10 people struggle with a usage problem. How can they get back on their feet? Let’s take a closer look at how you can magically improve your credit score today!

Usage problem uncovered.

Usage loans are very common in this business because many investors have a usage problem. The usage problem is created when investors excessively use their personal credit cards or personal loans to pay for their business expenses. This will affect you everywhere you go, whether it’s a flip project or you’re applying for a DSCR loan. Here at The Cash Flow Company we deal a lot with credit score struggles, fix and flip properties, and rental properties. No matter what the project is, having good credit is the key to getting the funding you need.

Credit score struggles.

If you are above 30% usage on your credit cards, your  score  will begin to decrease. This percentage is also referred to as the credit utilization rate. Investors who come in with a 640 or a 660 credit score often need to increase their score to 700. In doing so, they will be able to get either the LTV or rate they need to create cash flow. Nowadays rates are still in the 7’s or 8’s. That is why it is so important to get the best rate you can in order to maximize both your LTV and cash flow. 

How can a private loan help your credit?

One quick way to increase your credit score is to use a 911 loan. This loan is used to pay down credit card debt by using private money. These private funds are secured with a property to ensure the repayment of the loan. Once the credit cards are taken off of the credit report and the new statements cycle, credit scores will then reflect the changes. 

Where do you get started?

The first thing that you need to do is run a simulation. We ask investors to do a simulation on MyFico, Credit Karma, or Experian to see how paying off a credit card will impact their credit score. We have seen people max out their credit cards at $3K, while others are maxed out at $175K. These maxed out credit cards are not only impacting their credit scores, but their DTI as well. To clarify, DTI stands for the debt to income ratio. 

For example: A client in Texas just went through a simulation and his credit score went up 100 points. He went from 653 to over 753 by simply paying off the credit cards that he had maxed out. 

High credit score means higher cash flow.

In the following example we are going to look at how credit scores can drastically impact your ability to qualify for a DSCR loan. Not only will a lower credit score increase your interest rate, but it will decrease the cash flow for your property as well. Remember, hurdle number one is making sure that both you and your property qualify for the loan. By taking 2 to 4 weeks to get the 911 usage loan, you will be able to not only buy the property, but you can then refinance it later on. This method also provides the opportunity for you to move over any remaining balances over to a business credit card.

Loan Type Property LTV of 80% Net Rent
DSCR $312K $250K $1,800
Credit Score Interest Rate Monthly Payment Can it Qualify?
680 8.8% $1,976 No
760 7.45% $1,740 Yes

Learn this magic trick today! 

Business credit cards are an excellent way to separate business expenses from your personal accounts. These credit cards are easy to get and work the same as personal credit cards. By moving expenses over to business credit cards, it wipes the charges off of your personal credit completely. As a result, your credit score, cash flow, and ability to qualify will all increase. 

We are here to help!

Here at The Cash Flow Company we are here to help you get on the right path. Do you need to get your credit card debt off of your personal credit report? Contact us today to find out more about usage loans and how they can set you up for long term financing. Just to clarify, the usage loan is a private loan that does not show up on your credit for 60 to 90 days and won’t affect your DTI. Now is the time to set yourself up for success! 

Watch our most recent video Help! I Can’t Get a DSCR Loan Because of My Credit to find out more.

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Don’t Let Bad Credit Scores Rob You!

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Your credit score is powerful. But bad credit scores can take you from making it big to losing a lot of money.

Especially in the real estate industry, credit scores play a huge role in the success of your investing. We see many investors (especially ones who are new to the game) struggle with some common issues:

  • Forgetting to pay bills on time
  • Overusing credit cards
  • Not using enough credit

Cultivating and maintaining a healthy score is a fine balance between creating debt and paying bills.

What Can I Do About Bad Credit Scores?

This is where companies like us or Hard Money Mike come in.

If your score has dropped because of late payments, the best way to fix that is simply time. However, if it’s low from over-usage, you have some options!

Usage Loans

So long as you are paying your bills on time and have a small amount of debt that keeps your credit score active, you can fairly easily raise your credit score with a usage loan.

We offer emergency usage loans here at The Cash Flow Company to raise your score FAST.</span>

Business Credit Cards

If you’re using personal credit cards for business-level investing, it’s time to re-evaluate. 

Real estate investing simply requires more usage than personal credit cards are designed to reward. Business cards, on the other hand, typically like higher usage.

If this is new to you, we have many resources to help you find the right business card for you.

 

Read the full article here.

Watch the full video here:

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Credit Score 911 How to Qualify for a Utilization Loan

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Credit Score 911 How to Qualify for a Utilization Loan

A utilization loan, or 911 utilization loan is useful for both flippers, as well as real estate investors. Unfortunately, not everyone can qualify for a 911 loan, but it is available to those who pay their bills on time and need to quickly raise their credit score. Many of the clients we see get stuck in the trap of using their personal credit cards for business expenses. This in turn can have a significant impact on credit scores in the long run. There are three things that we look for to determine if you qualify for a utilization loan. Let’s take a closer look!

First, make sure payments are on time.

This loan is ideal for clients who spiral into personal credit card debt from using their cards for business expenses. The most important requirement to qualify is that they have been paying on time every month. If you haven’t been paying on time, then you will need to get back on track in order to be considered.

Second, have something to secure the loan with.

We are an asset-based lender and require a piece of real estate to secure the loan. We want to not only ensure that we have the security for lending, but that you also have leverage for your next step.

Third, how do you pay a usage loan back.

In using the 911 loan, you are able to increase your credit score. Which, in turn, allows you to get your next loan, qualify for a refinance, purchase your next flip property, and so much more! However, it is important that you think ahead about how to pay off this usage loan once you get back on track. This can be done by either getting cash out or using a HELOC to pay us off. 

Is a usage loan right for you?

We have a client for example with 200K in credit card debt who is paying 6-7K per month now. By doing the 911 loan, we were able to cut their debt in half to 3K per month in credit card payments. Another client was able to raise their credit score 12 points and receive a HELOC. While someone else was finally able to qualify for a SBA loan. Again, this is not a long-term loan! This is a 911 loan that will help get your credit score back on track and provide the leverage you need to be successful.

How can we help you?

Not sure if you would qualify for a credit utilization loan or where to go next? We have resources that can help guide you through the process. It only takes about 10 to 15 minutes to run through the information and see if we can help. After that, we will also help to set things up correctly to ensure you aren’t faced with these issues again. 

Before reaching out, there are a few things you can do to see if this is the right move for you and your business. 

  1. Go to MyCredit, MyFico or another credit website to run a simulator. This will show how your credit score is impacted once you pay off certain debt.
  2. Look at your payments and leverage. Are you paying everything on time, and do you have a real estate property that can be used to secure the loan?
  3. How can you get out of it in less than 12 months? You need to have a way to pay off the 911 loan in a short period of time. 

These are good loans for real estate investors who are trying to get credit card payments paid down. So many people go into credit card debt, and it can take a year or two to recover by paying them off as they build. It’s easier however, to pay 8-10% interest on a HELOC then 29% interest on a credit card. 

Watch our most recent video or contact us today to see if you qualify for this quick fix, so you can enjoy investing in the future! 

Go to our website to fill out an app and set up an appointment to discuss more. The more information you can give us, the more we can do to get you back on track! 

 

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Boost Credit Scores Overnight With 911 Loan

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Does your credit score need some CPR? We have a 911 loan that can boost credit scores overnight.

In the current economy, credit scores are one of the primary determiners in whether or not you get a loan. Previously, there were more loans available for people with lower scores. More flexibility meant a larger safety net.

However, currently people with low scores are struggling to find loans.

If you do manage to get a loan, your credit score will likely affect your rates, terms, etc. 

Essentially, a good credit score can make you money. But a bad credit score can burn a hole in your pocket.

What is a Credit Score 911 Loan?

A Credit Score 911 Loan essentially comes in and pays off your credit card. It moves that balance to a non-reporting loan.

This lets your credit score skyrocket the moment the next report is processed.

This loan also moves quickly. We can work through the process efficiently on our end, meaning you could see results in as little as two weeks.

Should You Get a 911 Loan?

If your credit score needs an overnight boost, the first thing to do is figure out why your score is low. 

Typically, it’s due to one of two reasons:

  1. You haven’t paid on time
  2. You have a usage issue

If you haven’t paid your bills on time, then unfortunately, there isn’t a quick fix. You’ll just need to heal your score slowly over time.

However, if you have a usage issue, then you’re in luck!

Credit Usage Explained

Credit usage measures the percentage of your total allowed balance you use each month. 

For example, if your usage limit is $10,000, and you’re frequently using $7,000 of that, you have 70% usage.

Ideally, FICO wants to see you using about 20%-30% of your available credit. Any higher than that, and you become riskier for banks.

Especially when you’re beginning as a real estate investor, it can be so easy to rack up the usage: getting supplies at Home Depot, paying contractors, etc. with your personal credit cards.

When that usage percentage goes up, your score goes down.

When your score goes down, your costs go up.

That’s where a Credit Score 911 Usage Loan comes in to pay down that debt and boost credit scores overnight.

What’s Next?

If you’re wondering if a Credit Score 911 Loan is right for you, what steps should you take?

  • Look at sites like Credit Karma or TransUnion. See where your score is at, and run simulators to see what would happen if you paid off certain credit cards.
  • Consider the qualifications for a 911 loan. Are you paying on time? Do you need to fix the problem quickly?

If you’re ready to take the next steps or have questions, reach out to us at Info@TheCashFlowCompany.com. 

We’re always happy to talk you through a 911 loan, how it can pay down debt, and how you can set up your business to avoid this problem in the future.

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Understanding the Credit Score 911 Loan

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If you’re struggling with a low credit score, a 911 loan could help you get back on track!

A Credit Score 911 Usage Loan is essentially a non-reporting loan that pays off all credit cards, allowing your credit score to shoot upwards.

These loans act as a fast-acting antidote to your credit score usage problems. The next time your credit report generates, you should see significant improvement.

Essentially, it’s a quick fix for people who pay their bills on time.

Who Should Use a 911 Loan?

If your credit score is weighed down by a long history of late payments, this loan is not going to help you very effectively. 

These loans are perfect for people whose credit has been plagued by high usage, who need to fix their credit score FAST.

In short, here’s what you should know about a 911 Usage Loan:

  1. 911 loans pay down debt that accumulates through usage issues, not late payments.
  2. We’re an asset-based lender, so make sure you have some real estate to secure your loan.
  3. You need an exit strategy. We want to make sure you have a way of paying that loan back.

Real estate investing is a fast-moving business. It’s important to have a quick solution for an issue that could otherwise cost you thousands of dollars in higher payments or declined deals. 

How Long Before it Pays Down my Debt?

We call this a “Credit Score 911” because we understand that a low credit score can be an emergency need.

It can take as little as 2 weeks (or up to 30 days) to get this loan and see results in your credit score. The timing depends simply on when your credit cards report and when your statements come out.

You still owe the money, but now you owe it to a non-reporting entity.

Although it can be daunting to take out an unexpected usage loan, a delay of a month is far better than a long term delay where you can’t refinance or buy.

 

Read the full article here.

Watch the full video here:

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How to Fix a Bad Credit Score

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Your credit score is powerful. A bad score can take you from making it big to losing a lot of money.

Especially in the real estate industry, your credit score plays a huge role in the success of your investing. We see many investors (especially ones who are new to the game) struggle with some common issues:

  • Forgetting to pay bills on time
  • Overusing credit cards
  • Not using enough credit

Cultivating and maintaining a healthy score is a fine balance between creating debt and paying bills.

Why Do You Need Debt?

Without some debt, FICO doesn’t recognize you. Without debt, even if you try and calculate your score, you can only get a low one.

This isn’t helpful when you’re trying to purchase investment properties.

Essentially, debt allows your score to exist and gives it the chance to be high—you just shouldn’t have too much debt, and you need to pay your bills on time.

Consequences of a Bad Credit Score

If you end up with no debt, your credit score is likely to drop (or disappear altogether for a while). 

With a low credit score, you can expect higher interest rates on your house, car, and any other loans you hope to take out. 

This makes you lose money fast and can get in the way of your investing or even your retirement. 

Consequences of a Good Credit Score

In contrast, if you have a high credit score, you can look forward to cheaper interest rates and lower bills. 

This makes it far easier to create successful income from real estate investing.

Additionally, if you maintain a high score, you’re more likely to build positive relationships with lenders and grow your business more quickly.

What Can I Do About a Bad Credit Score?

This is where companies like us or Hard Money Mike come in.

If your score has dropped because of late payments, the best way to fix that is simply time. However, if it’s low from over-usage, you have some options!

Usage Loans

So long as you are paying your bills on time and have a small amount of debt that keeps your credit score active, you can fairly easily raise your credit score with a usage loan.

We offer emergency usage loans here at The Cash Flow Company to raise your score FAST.</span>

Business Credit Cards

If you’re using personal credit cards for business-level investing, it’s time to re-evaluate. 

Real estate investing simply requires more usage than personal credit cards are designed to reward. Business cards, on the other hand, typically like higher usage.

If this is new to you, we have many resources to help you find the right business card for you.

Next Steps

We’re always happy to walk you through the ins and outs of navigating your credit score.</span>

Having a healthy score is accessible to nearly everyone with the right coaching and tools. If you’re struggling with low credit, talk to us, and we’ll be happy to discuss your options.

As always, let us know if you have questions about credit scores, usage loans, or business credit cards. You can reach out to us at Info@TheCashFlowCompany.com or fill out a contact card.

Happy investing!

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The FASTEST Way to Pay Down Debt: Credit Score 911

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If you’re stuck with a bad credit score, a 911 loan could be the perfect way to pay down debt.

One of the most common issues of investors we talk to is low credit score.

In the real estate world, when the Fed tightens everything up (as they have done recently), credit scores become more and more important. This means that the threshold of what qualifies as a “good” credit score goes up, and it’s almost impossible to get a loan if you don’t meet that threshold.

How can you fix that quickly so it doesn’t tank your investments?

The Changing Economic Landscape

Everyone used to have options. If your credit score was a little low, it was alright; you could still find someone willing to lend to you without too much penalty.

In recent years, things have shifted.

As the Fed tightens up, there’s less money going around, meaning banks don’t have as much money to lend as they used to. 

How do they solve this problem? 

They raise the requirements for getting a loan.

Now, instead of being minorly penalized for a low credit score, some people are finding it difficult to find loans at all. And some of the loans they do find are smaller and have significantly higher rates.

Some banks may not even look at your loan application if you don’t meet their credit score requirement.

Understanding Your Credit Score

The 2 largest factors that make up your credit score are payments and usage.

  • Payments look at whether or not you’re paying on time. 
  • Usage looks at how much of your total possible balance you’re using each month.

For example, if your usage limit is $10,000, and you’re frequently using $7,000 of that, you have 70% usage.

Ideally, FICO wants to see you using about 20%-30% of your available credit. Any higher than that, and you become riskier for the banks.

Especially when you’re beginning as a real estate investor, it can be so easy to rack up the usage: getting supplies at Home Depot, paying contractors, etc.

It’s all-too-common to see people have $50,000 or $100,000 on maxed out credit cards.

This is where a credit 911 loan comes into play to pay down debt.

What is a Credit Score 911 Usage Loan?

A Credit Score 911 Usage Loan is essentially a non-reporting loan that pays off all credit cards, allowing your credit score to shoot upwards.

These loans act as a fast-acting antidote to your credit score usage problems. The next time your credit report is generated, you should see significant improvement.

Essentially, it’s a quick fix for people who pay their bills on time.

Who Should Use a 911 Loan?

If your credit score is weighed down by a long history of late payments, this loan is not going to help you very effectively. 

These loans are perfect for people whose credit has been plagued by high usage, who need to fix their credit score FAST.

In short, here’s what you should know about a 911 Usage Loan:

  1. It’s used to pay down debt that’s accumulated through usage issues, not late payments.
  2. We’re an asset-based lender, so make sure you have some real estate to secure your loan.
  3. You need an exit strategy. We want to make sure you have a way of paying that loan back.

Real estate investing is a fast-moving business, and it’s important to have a quick solution for an issue that could otherwise cost you thousands of dollars in higher payments or declined deals. 

How Long Before it Pays Down my Debt?

We call this a “Credit Score 911” because we understand that a low credit score can be an emergency need.

It can take as little as 2 weeks (or up to 30 days) to get this loan and see results in your credit score. The timing depends simply on when your credit cards report and when your statements come out.

You still owe the money, but now you owe it to a non-reporting entity.

Although it can be daunting to take out an unexpected usage loan, a delay of a month is far better than a long term delay where you can’t refinance or buy.

How Can I Set Myself Up to Avoid Needing a 911 Loan?

The root of this problem is almost always using personal credit cards for business-level needs. 

Getting the right business credit card in the name of your investing company has a number of benefits:

  • It won’t report to your personal credit if you pay on time.
  • They don’t penalize high usage.
  • Some business cards even reward running up a larger balance.
  • Even if your business is brand new, if you apply for a business credit card with a high personal credit score, you’ll likely be approved.

We’ve partnered with Nav to help you find a business credit card that works well with real estate investing. 

As with a personal card, you can find cards that offer perks and rewards that appeal to you. Just make sure you look for ones that 1) don’t report to your personal credit and 2) like high usage.

Our goal is to help you fix your credit score and get your business in order so that you never need a 911 loan again!

Next Steps

If you’re wondering if a Credit Score 911 loan is right for you, what steps should you take?

  1. Look at sites like Credit Karma or TransUnion. See where your score is at, and run simulators to see what would happen if you paid off certain credit cards.
  2. Consider the qualifications for a 911 loan. Are you paying on time? Do you need to fix the problem quickly?
  3. Draft a plan to pay off a credit score loan. Especially if timing is important, having your exit strategy ready helps us get that money to you more quickly.

Remember, you still need to pay everything on time. We’re just here to help people who have fallen into the trap of using personal credit cards for business purposes in this competitive environment.

If you’re ready to take the next steps or have questions, reach out to us at Info@TheCashFlowCompany.com. 

We’re always happy to talk you through a 911 loan, how it can pay down debt, and how you can set up your business to avoid this problem in the future.

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How to Make Your Real Estate Business E.L.F.F. 

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Making your real estate business Easy, Lucrative, Fun, and FAST is a critical component to your success as an investor!

A while ago, Joe Polish from I Love Marketing began using the acronym “E.L.F.” to describe an easy, lucrative, and fun business.

However, in the real estate world, time is everything. While we totally support easy, lucrative, and fun real estate investing, we also recognize that we need to move FAST.

How Do You Set Yourself Up to Win?

You need to learn to play the leverage game. Leverage (using other people’s money in the form of loans and gifts) is what makes real estate investing lucrative and accessible. Having the right leverage when you need it can really make or break your business.

And the truth is this:

Leverage is significantly affected by your credit score.

How Does Credit Score Affect Leverage?

Having a high credit score often comes with many perks. You might get offered better rates or terms, asked fewer questions, and experience faster approvals with less paperwork.

Unfortunately, while your credit score might make the loan process easier, a bad credit score can make your life a lot more difficult.

Let’s Check Out a Scenario…

If we look at a hypothetical purchase price of $375,000. In order to make the property cashflow, all our hypothetical investors must maintain a monthly mortgage payment of $2,000.

Even though each investor is looking at the same property and mortgage payment, their credit score affects their other payments.

Our Investors:

  • Jessica: She’s a dedicated investor who takes care of her credit, monitoring her score and keeping investment payments on business cards.
  • John: He uses personal credit cards for all his investments which has resulted in a score just above the minimum eligibility requirement for most traditional loans.
  • Sammy: He doesn’t monitor his credit and is convinced the banks just hate him. He never bothers to check his credit score.

The Numbers:

Each of our imaginary investors end up in a different financial situation purely based on their credit score. 

Even though their monthly payments are the same, Jessica ends up getting much more money at a lower rate. Meanwhile John and Sammy are stuck with smaller loans, less leverage, and a slow-moving process.

The Need for Speed

In our example above, Jessica has the advantage over these two investors because she can move through projects faster. She isn’t stuck waiting for approvals or trying to come up with so much additional money outside of her primary loan. 

Leverage makes real estate investing an even playing field for everyone out there, but credit scores can limit your leverage if you’re not careful. 

A good credit score opens doors and makes everything cheaper, easier, faster. 

To E.L.F.F. the real estate business, you need to set yourself up to win.

How to Set Yourself Up For Success

We’ve been in the business for a long time and there are a few important changes you can make to easily improve your investing.

1. Switch to business credit cards.

We’ve talked previously about the importance of not using personal credit cards for business-level investing. 

Most personal credit cards simply are not designed for the level of usage needed in the real estate investing business. Because of the quantity of purchasing necessary for most fix-and-flips, you may want to look into business cards that have higher usage limits.

2. Consider a usage loan.

If you are in a situation where your credit score is negatively affected by high usage, don’t worry. You can look into a usage loan.

We offer them here at The Cash Flow Company, or you can check out our partner company Hard Money Mike. 

We’re Here to Help!

We invite you to take advantage of our 20+ years of experience and check out the programs and free tools we’ve specifically designed to help new investors like you. 

If you have questions or would like to discuss loan options, please reach out to us at Info@TheCashFlowCompany.com or fill out a contact card.

With the right knowledge and leverage, all of us can have an E.L.F.F. real estate business!

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How Your Credit Score Impacts Loan Approval

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Credit scores and loans

Leverage/loans are the key to building a successful real estate business.  Credit scores are becoming more and more of a factor on who is approved for loans and or denied.

All serious investors must understand how to win at the lending game. A large part of that is understanding and managing your credit score.

Better scores equal better loans.  Better loans help create wealth and income faster.

 

How Your Credit Score Impacts Loan Approval

Lenders use your credit score when deciding if and how they offer you credit, such as mortgage, car loan or a credit card. Your score also affects terms and rates associated with these loans.

Your payment history is the cornerstone of your credit score, but other elements also play a part. These could include:

Your credit score is a number.

Lenders use your credit score to assess your risk as a borrower, using data reported to credit bureaus such as Equifax(r), Experian(r), and TransUnion(r).

Your credit score can have an immense impact on your life. It can determine whether a lender approves of an application for a mortgage.

Your credit score takes into account how you’ve paid past bills and the debt that’s currently outstanding, along with your mix of accounts (credit cards, retail accounts, installment loans (car or student loans) and finance company accounts). Lenders also look at how long it has been used; generally speaking it should remain under 30%.

Your credit score is a factor.

Many individuals don’t realize how important their credit score is in loan approval decisions. Lenders use it to assess whether someone should qualify for mortgage, business loans as well as determine interest rates that borrowers will pay on these loans.

One of the key factors affecting one’s credit score includes length of history, debt-to-credit ratio, payment history and types of accounts held. An equally significant element is how long since any negative event such as missed payments or bankruptcy occurred. Either can have an enormously detrimental effect on one’s score.

Lenders prefer to see a mix of retail, finance company and installment loans in your credit profile. Too many new accounts may raise red flags.

Your credit score is a red flag.

Lenders use credit scores to gauge whether or not someone will repay what they borrow. A higher score demonstrates responsible financial behavior.  Higher scores will help qualify an applicant for better terms on loans.

Your credit score is determined by many factors, including payment history, amounts owed, length of credit history, new accounts opened and mix. One keyway you can improve your score is paying debts on time: this component accounts for 35% of FICO scores and 30% of VantageScores.

Excessive new account activity can also lower a credit score. This factor is measured by the total number of hard inquiries on your report; these could include applications for new credit as well as inquiries made by lenders to pre-qualify you for loans or credit cards.

Your credit score is a good thing.

Your credit score demonstrates your reliability as a borrower and determines the likelihood that a lender will approve of you for a loan. Furthermore, it affects interest rates you will pay, potentially saving thousands over the course of your loan’s lifespan.

FICO or VantageScore scores are calculated based on information found in your credit reports. This information comes from the three major bureaus, which contain payment history, utilization rates and age information of accounts.

Setting and making regular on-time payments are two effective strategies for increasing your scores, along with keeping revolving balances to an absolute minimum. Lenders tend to prefer when their borrowers use no more than 30 percent of available revolving credit available.  Having multiple types of loans like mortgages, auto loans, and credit cards may also boost your score. Keep in mind that your score may change with new information appearing in your report over time.

 

Need a loan to increase your score in less than 30 days?  Credit score usage loan.

How Your Credit Score Impacts Loan Approval. Credit usage loan.

Credit scores and loans

 

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3 Strategies to Raise Your Credit Score

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3 Ways to Quickly Increase Your Credit Score

If you’ve ever wondered how to raise your credit score overnight, you’ve come to the right place.

Let’s take a look at three easy strategies to help you prepare for this financial gain: 

1. Increase Available Credit to Lower Usage

Banks look for an ideal credit usage of around 30%. This means that you’re only spending about 30% of the available balance.

For example, if you have a maximum credit line of $1,000 and you’re frequently spending $800, that is 80% usage. When lenders see such high usage, it tells them you’re really pushing the limit of that credit. Often, high usage signals a struggle to meet financial obligations.

You can fix this in two ways:

The first is to apply for a higher spending limit as noted above. The second is to lower your usage. If you’re working in real estate investing, chances are lowering usage is difficult, so we recommend asking your credit card company for a higher limit. 

2. Pay Extra to Raise Your Score

Another significant factor in calculating your credit score is the monthly reported balances to the credit bureaus. 

A good way to quickly raise your credit score is to pay extra whenever possible. If you have a little extra cash at the end of the month before your statement is due, this is an easy way to keep a negative report from being filed.

The score will go up, and the credit bureau (and you!) will be happy.

3. Get a 60-90 Day Note or Usage Loan

If those first two strategies don’t really work for you, then you can always take a third approach: find a loan.

You can apply for a short-term 60 or 90 day note. These are available from most banks, or you could look to family and friends for the small loan. You can also go through private lenders like us for a usage loan. 

A usage loan allows you to move the credit card balance off of that card (and away from your credit score). It can fix usage issues instantly as might be obvious by the loan’s name.

Also, by moving that balance to a different place, you’ll often find better deals which can allow you to pay off the usage loan more easily than you could have paid off the credit card.

 

Read the full article here.

Watch the full video here:

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