Has Anyone Ever heard of investing using your credit? I met an investor that said that since I have a credit score above 700 that He will use my credit to purchase houses. Then he will pay me 10,000 dollars at closing. He also said that in the contract that I will not be liable for the property that I can sue him if anything goes wrong. He said that he will refinance the property out of my name in 18 months.
THANKS
All I can say is I don’t want someone without good credit of their own being in control of my credit. I would never do anything like that. If he mismanaged his credit, you should be leery about him mismanaging yours.
And contrary to what he said, you are liable if he uses your credit for a mortgage. The risk is all on you.
Thanks for your answer. I thought about it for a long while and it does seem pretty risky.
OK, but here’s a similar, more reliable scenario: instead of a stranger, it is your parents who would put the downpayment, and you would get the mortgage to purchase an investment property. Suppose rent yields a small positive cash flow. So parents pay down 20%, then you make mortgage payments. Several years later you resell the home.
How would you split the equity? Is there a standard way to calculate the split?
Thanks!
I’ve heard of using credit cards to take cash advances for re-habs but not the way you suggest. I agree, why let some poor credit risk ruin your great credit?
Why not do what he’s doing and use your own credit.
This investor was just going to pay me 10000 dollars at closing and he would get everything else cash flow and equity at the end
This will help you decide it $10K is worth the headache! Do a search on the web for “Identity theft” and IF he is not a identity thief, what do you think would happend if something happens where risk became reality and he decided to jump ship … yes, you will get the shaft … and if you want to retain your 700+ credit score, then IT might cost your more than 10K in capital. Don’t look at the money…but what the risk is …