I’m new to this and I would like to get good advice from people who know. My score is 0, I’ve made mistakes when I was younger and a few more recent. Nothing major, just charge-offs. No Bankruptcy. Maybe totaling less than 5,000.00. I signed for someone close when at the emergency room one time (thinking It was nothing financially) and next thinfg I know I have a medical debt that is not even mine for over $14.000.00. This happened about three years ago, but it still is there. This would be my first home(property) purchase ever.

Anyway, I work in construction making cash (no proof of income). I have zero asetts. How can I buy with no money out of my pocket immediately? Because I work in construction I thought by flipping homes that would make some money, especially since I can do most of the repairs. Or if possible, buy a small apartment complex with a pos. cash flow.

The problem is, I’ve been calling hard money lenders to see if they can help and they say:

Q:How are you going to make your payments with no proof of income?

A:I say, If you can roll back the first four months, that would be enough time for it to sell.

A:If it is an apartment complex with renters there that can cover monthly payment.

Q:Do you have 10-40% Down?

A: No

Is it possible to get a HML on the 1st and another one on the 2nd to cover the down payment from the first or does that not work?

What type of deal do I need to do and/or say to the Private lender or HML for them to lend? I really would appreciate suggestions of ways to make this work with my situation?

Can anyone please advise me on what I can do to flip houses or buy apartment buildings or anything else that would allow me to make money and have someone help who only cares in the property as collateral (not a score) and with no proof of income requirements (maybe a stated doc?) ? What can I do? :help

Thank you,

ocddrywall - there was a posting here recently in the beginners forum about advice for newbies from fdjake… Here is a link:,36859.0.html

His recommendation is for anyone that wants to be successful in real estate to start by demonstrating self control first. It will be very hard to make money starting with no cash, very low credit, and income that you can’t demonstrate (please note that stated doc does not mean you can state what you make - you still need to be able to demonstrate it through tax returns, or bank statements, etc…).

One thing you could do that doesn’t require a lot of capital or credit is bird dogging… You find the deals and sell them to other investors. You could start doing that until you improve your credit and build a little bit of cash reserves…

Good luck!

Thank you j1dias,

So meanwhile there is no chance of buying through a hml or private money?

No matter what you choose to do, start trying to repair that credit in the meantime. See if you can get one of those “guaranteed” credit cards where you put $500 in an account and then use the card. It’s different than a debit card with a regular bank account. I saw this advertised on tv a few years ago. Or just see if you can get a regular Visa or Mastercard with just a $500 limit and start using it and paying it off.

ocdrywall - I agree with Justin’s suggestion. You should start repairing your credit TODAY. Please realize that it will take some time to fix your credit problems. It is not going to happen overnight. And it will probably involve paying the old debt. But don’t be discouraged. As you start working on your credit you will see it improving slowly but steadly.

Good luck. Keep us posted.

If your credit score is 0 you don’t have bad credit you have no credit. What you will have to do is find a deal that the HML have to take. You need to be 50 cents on the dollar or better.


I really need help understanding this:

Are you saying the ARV would have to be 50% ARV or less?

Is it possible to get a HML on the 1st and another one on the 2nd to cover the down payment from the first or does that not work?

What type of deal do I need to do and/or say to the Private lender or HML for them to lend?


In your current situation no one is going to lend you money. You have no verifiable assets, no verifiable income, and no credit scores which I find very hard to believe because you have charge-offs. You are asking a lender to lend you money for down payment, closing costs, and all of the payments during the rehab phase. Not going to happen. You have been given some good advice in this forum… start using it. My suggestion is get your income situation figured out. If you are being paid cash under the table go get yourself registered as a business and start filing a tax return for that business showing the cash you are being paid. The days of stated income and no doc loans are gone. HML’s don’t want the properties back so they are making sure that someone can take care of the deal before they just throw money at them. You have to have income to qualify for a loan. Once you have income you can go buy yourself a duplex using an FHA loan (which allows 0 credit scores) with a low downpayment (DPA’s are gone 10/01/08) and fix it up while living in one side and renting the other.

ocdrywall, When it was suggested that you read the post by fdjake, you responded by saying ( after I assume you read it) by still looking for ways to finance your investing. I think you missed the point of fdjake’s post. If you’re not educated about cashflow management, use of credit, and lack the DISCIPLINE to keep your finances on track, you have no business starting a business and expecting to succeed. Prove to yourself and lenders that you can responsibly manage your finances.

1.You do that by working your butt off to raise the money you need to save/pay bills on time.
2. Go to 3 local banks and purchase a 6 month or 1 yr. CD.
3. Get a personal loan for the value of these CD’s from these banks. Secure these loans with the CD’s as collateral. Stuff the loan amounts in a checking account. Use the money in the account to pay back the loans. Also try to get a low credit line unsecured credit card. You’ll be building up GOOD credit and a relationship with banks.
4. During this time, read as much as you can about REI. Ther are tons of books. This site is awesome. Since there are so many different ares of REI, you should read about all the various areas and chose the area that fits you. Absorb as much info as you can about it. I can recommend a few good books.

" The Millionare Next Door" by Thomas Stanley.
" 1 Minute to Rental Property Riches", by Mike Rossi (Prpertymanager)
" The Millionare Real Estate Investor", by Gary Keller.

Fixing your situation will take time, discipline and a LOT of hard work. But you’ll be in a better position to succeed. Good Luck.

Thank you all for good advice. I like the ways of fixing credit.

phlemboy: I read the link and did not miss the point. I want to see what my options are to buy not bird dog. wholesale is ok if it is the last resort. What I don’t understand is how supposedly one is able to buy with bad credit, no credit. So I’m trying to get some info on how. Chris says it doesn’t happen and I just want to get more opinions.

Chris: I have no reason to lie to anyone. I just got through sharing all my credit information. Why would I hold information back? I’m being honest that the score is 0.

1800 Co: Thanks, thats what I’m looking for… to be creative.


I did not mean that I thought you were lying. I just meant that it is hard to believe that you have zero scores if you have charge-offs.

If you can find the right deal/ owner, you can do a number things. You can buy a home with 100% owner financing. If you can buy a ome that needs work, you can use your “sweat equity” to increase the value. Then you can refi after your credit score improves. There are many things that you CAN do. But in my opinion, you shouldn’t be investing in anything until you get your financial house in order first, AND you educate yourself about how to do it the right way. I say this because I thought I was ready to jump in get going. I was looking for ways to finance this or that. Then I found this site and learned I was WAY OFF! There are 4 properties that I would have bought, that I thought were a good deal. After learning how to analyze the numbers from the “vets” on this site, I would have lost money. I passed on those properties. They were all bought for the asking price (or close to it). After 6 months, they’re all back on the market for the same price… Gee, I wonder why?? :rolleyes :banghead :banghead Its not money that makes money, its education…

Hey buddy, learn how a lease-purchase works. After 12-24 months you can have significantly altered your FICO for the better and have a chunk of money to put down towards a purchase. Good luck.

How is a lease purchase going to increase one’s FICO?

How is a lease purchase going to increase one's FICO?

I am wondering the same thing. How does this work JBaldwin?

I know that you can use the payment history on a lease-purchase to show “mortgage” history and refinance in a year. (use checks) However, it will not have any effect on your credit score as it does not report to the scoring agencies.

There are services that will report payments to the credit bureaus on a monthly basis.

I think jbaldwin was talking about improving in other ares in addition to the lease option. I improved my credit score from 585 to 680 on about 2 yrs. It takes a while, but it’s a good idea to try to get some new “good” credit. I think each lender will look at every situation diferently. When I talked with my local loan officer (underwriter) he said I’d need to demonstrate on time payments for 2 yrs. He advised me to keep records of EVERYTHING from phone bills to rent.

Here is what I have done:

 First I am self employed and have a 475 crdit score. I am a contracter and spent a number of years screwing up am working noe to repair credit. 

 I have read and studied everything i can get my hands on and have begun to build my network of support people. I have worked for a number of people who have alot of money and most importantly have done good quality work for them. I also rehab properties for an investor so I can show a before and after shot of a $20,000 rehab. I mention to everyone that I can put together turn key rental units with 50-70% equity, so they can rent them or flip them.

 Currently I have two people commited to purchasing property to flip, one will be providing $35,000 to do a unit with and will profit an estimated $10,000 + on the deal. So in 90 days I will show him 25% on his money which is 100% in a year. Very nice for both of us. Also, his investment is secured by the real estate and there is no chance that he will not get his $35K back.

 I have a plan developed that will in the next 12-18 months free me of using their money unless  want to and repair my credit. This will allow me to finance my own pojects or leverage all of our resources for a bigger deal.

 Work the numbers find the deals and use all your resources to pertner up with someone.

 Also you could look for my post in the rehabbing section.

Holy Smoke

I hate to say it guys but i feel I must.

I could teach a blind dog to buy a house if it was broke unemployed just filed bankruptcy after a foreclosure and it ws living under a bridge with the lowest credit score for each bereau.

One bit of good advice in there Lease Options

Did I hear pure options?

Did I hear private money?

It’s like this for your question…YES IT CAN BE DONE

NO MONEY DOWN is in my opinion easier that conv financing its quicker for sure.
Factoring in the time value of money I like using private money because it speeds up the process so that I can use THE TIME VALUE OF MONEY to best effect. Private money also makes for quicker escrows which secure lower prices just like it does when you say I’ll buy your home cash.

My whole point is

problem no money no credit

Solution = Options, Lease Options, private money

Personally I don’t like the Idea of cashflow properties…
There are so many other ways to make more cashflow without all the management issues.

Thanks for reading
Brice Cook

I’m curious, why would anybody want to lend you money if you have none of your own and have terrible credit (which, of course, means you have failed to pay people back in the past)? I don’t mean this question to be rude, but I’m trying to see what the pros would be to the private lender. I see some out there who will give you an HML loan @ 15% interest WITH a minimum FICO of 620, so I can only imagine what somebody with completely hacked credit would pay in interest. I think that is why people are saying you need to repair your credit first. I personally have excellent credit and am hoping to use that to my advantage. :bobble