Posted by Ed Garcia on December 15, 2000 at 10:29:46:
Thank you for sharing your situation with us. I’d like to start out buy saying that, I hope your son has recovered and is doing well. Of course the BK will affect you in real-estate investing, but it will not stop you. By the way you didn’t mention going into a chapter 13, which is a bankruptcy of re-organization. You might look into that if you have any current real-estate or assets. Also if you do go BK or just want to attempt to restablish your credit go to creditinfocenter. Com. There you will find a credit repair kit as well as information regarding your legal rights and much, much more.
If BK is inevitable for you, try to re-establish your credit immediately. The problem is most people are embarrassed when they go BK and procrastinate re-establishment.
Here are some ways you can do deals if you have bad credit.
(1) PARTNERHIP: Find a 50/50 partner. It don’t have to be 50/50, it can be what ever you can negotiate.
(2) FLIP: the best way to flip is to find a potential buyer first and then find a property. You can do this by running an ad on a property to see what kind of action you get. Once you have a potential qualified buyer, you’d be surprised how easy it is to find them a house.
(3) LEASE OPTION: Many times you can buy and sell with a lease option. We call this a “Sandwich Lease Option”. Jim, I’m not going to go into any great detail, you can find this information all over this forum.
(4) SELLER CARRY BACK: This is one of if not my favorite way to buy. Now the best way to utilize this system, is to do a second seller carry back in order to give the seller some cash in the deal. If money doesn’t exchange hands, many times the seller doesn’t feel that they consummated a sale.
(5) HARD MONEY: Hard money, is an equity loan made at approximately 65% LTV, based on the equity of the property only. Credit is not a consideration.
(6) HARD MONEY/SELLER CARRY BACK: Again, You can have the seller carry back a second and refinance the first, giving the seller some money. You can do variations of this system.
(7) SUB PRIME FINANCING: Many National lenders will provide financing at 70% with poor credit and won’t verify money down.
(8) SUB PRIME/ SELLER CARRY BACK: Again this combination can provide money to the seller, rather than ask them to carry the whole thing. Also there are local independent portfolio lenders that will lend as well as mortgage co’s and I always recommend seeking them out. National one’s would be Associates Finance, American General, Beneficial etc.
(9) CREAT YOUR OWN MORTGAGE: In our work shop, Terry Vaughan covers this, and shows you how to discount it and market it.
Mike, I hope this post is helpful to you and will encourage you to stay with it. The only way you won’t be successful in this business, is when you stop trying.