BAD CREDIT, NO CASH – END OF THE WORLD? NO WAY!

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BAD CREDIT, NO CASH – END OF THE WORLD? NO WAY!

March 1, 2016
Bill Gatten
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LET’S GET SERIOUS ABOUT THIS BUSINESS OF OURS!

NO ONE NEEDS PILES OF CASH OR GREAT CREDIT
IN ORDER TO MAKE A LOT OF MONEY IN
“CREATIVE” REAL ESTATE INVESTING!

Can you acquire investment real estate and get wealthy, despite starting off with ‘No Credit,’ ‘Marginal Credit’ or even ‘Bad’ Credit?  ‘And how about making money in this business when your perceived short-comings include — ‘having no cash either?

Wait! Let’s make it even worse.  Let’s presume you’re sans (i.e., without) cash and credit, but you also have no experience, no professional contacts…’and you’re ugly.

[Were any of these factors really to matter, regarding success in this business, ‘especially that last one-I’d still be slopping pigs and plucking chickens for a living (…’not meaning to disparage any chicken-pluckers or pig slop slingers out there, by the way; ‘but I do find accumulating and counting money and real estate titles is a far more rewarding enterprise)..

Regarding the first question (i.e., “Can you…”), the answer is a resounding “YES”! But that’s true only if you have lots of other stuff too, ‘such as a self-starting ability, determination, sincerity, maturity and at least a modicum of salesability… and–above all– ‘a Burning Desire to Achieve!

Do you need every one of these qualities in order to be financially successful?  No! But if you are missing any one of them, your maximal chance of success is reduced proportionately with each missing element…’with special attention to the “Burning Desire” part.

With no disrespect for those who have sacrificed, scrimped, and saved to maintain perfect credit, I’d like to say that I couldn’t adequately express the respect (‘and no small degree of jealousy) that I have for you and your achievement. Personally, however, I have never been blessed with a lot of money and good credit at the same time.

Throughout the many phases of my own personal development (‘beginning somewhere around the Cenozoic Epoch), I’ve had both…’just never simultaneously.

Nevertheless, even without an abundance of cash and/or credit at any one time, I’ve managed to accumulate several million dollars’ worth real estate at various times over the years; ‘with almost none of it acquired with, or because of, credit (or cash).

And although, to some extent, the cash and credit parts of life-in general have improved a bit for me, I still prefer to acquire property silently and secretly without a cent out of my own pocket, and without a new mortgage loan or monthly payments.

Real estate is virtually free for me, given the way I do it, ‘in as much as my resident-beneficiary tenant-partners make the payments, handle all repairs and upkeep, and cover any upfront fees when I put them in the properties).

For anyone whose credit has been damaged: ‘know for sure that reestablishing it is a prudent thing to do; however, don’t forget that one’s not “using” their credit (the American Stoic approach) is far worse than one’s not having it.  Although, millions of us do just fine without it for long stretches of time…because we can get it.

Here’s my logic: If people with great credit don’t use it, and get rich anyway, ‘why would someone else without any need to worry about not having it?

And that’s where I come in.  In my own case, I filed a business BK in 1989, and gave away, and spent, everything I had ever owned in my life (‘everything!) in order to pay off my creditors. It took a while, but I did it, and I didn’t suffer much in the process, because within a month of having gone through the ordeal, I acquired a beautiful $520,000 home without a penny out of my pocket and without any need for credit. I even gave the seller (‘Mr. and Mrs. Gil Burrell of Granada Hills, California) my full credit report along with all the information leading up to my bankruptcy.

I got the property based solely upon my pleasant demeanor, decent “selling skills” and my plausible explanation for the BK and bad credit. Because of the sincerity I portrayed along with my offer to provide my plan for correcting the problems (and the “expensive looking” suit that I was wearing), the idea of credit per se became a non-issue for getting that property…’and another fifty more over the next couple years.

After that period in our lives, unfortunately the Burrell house was shaken apart by the 1994 Northridge Earthquake, reducing its value overnight by $300,000, leaving an over-encumbrance of $200,000 plus: ‘at which time I just walked-away; ‘and by the same techniques, acquired another home  a mile or two distant, and carried-on with our business (i.e., ‘no down, no credit, no new mortgage real estate acquisition), whereby my resident co-beneficiaries in the trusts that held titles to those properties, paid all the bills and handled all maintenance and general expenses for me (‘payments, taxes, insurance, HOA dues and a reasonable positive cash-flow to me)…’in exchange for use, occupancy, full tax-deductions, loan principal reduction, hoped-for appreciation and Pride of Ownership.  [Neither I nor they were on title, or on the loans, but with the EHTrust™ transfer system that we teach, that doesn’t matter.]

So…’about the time I began to feel secure, successful and cocky again re. my exquisite home-buying skills, and making better than average money by teaching hundreds of others how to do what I knew how to do so well, ‘the 2007 Subprime Crisis swooped in, hit hard and gained momentum clear up to, and well-beyond, 2010 (‘and is still haunting hundreds of thousands of the “totally screwed” throughout the country today.

In 2007 and the early part of 2008, I was fortunate enough to see the proverbial “writing on the wall,” and successfully sold-off several of our properties…the one’s with real equity in them (‘in which I had pure profit due to having no real money invested in them).

However, as is the often the case …‘When the Student is ready…the Teacher…’swoops down from out of the sky and beats the living crap out of the poor student…’in order to cure him of his hubris and wholly unearned cockiness.

Overall, in the melee I lost 53 properties due to the crisis, and managed to use up the profit I’d gotten from my earlier sales in attempting to salvage the rest…’all to no avail, while the economy continued on its path from “really bad” to atomically super-shitty (‘pardon the expression…’it’s an ancient Druid term derived from an amalgam of the ancient Druid words – “Shingle,” and the abbreviation for “Teletype”: I.e.: Shi[ngle]+TTY).

Since that time, we’ve survived, and we do reasonably well in having silently acquired a modest number of other properties by precisely the same methods…’i.e., ‘wholly without credit or cash, but with being more picky about our tenants and how much up front cash they come in with.  We now make sure they don’t have bullet holes in their cars, and that their pants are not lowered below their buttoxes ‘so as to display their gang colors on their drawers or any “vertical hemispheric demarcation (‘as it were).”

I wouldn’t say we’ve recovered completely…yet, ‘but we’re getting there, and we do eat pretty regularly, and are reasonably well-protected from the elements (wind and rain) ‘as long as the next storm doesn’t blow the canvass off our makeshift tent poles. (‘No…’actually we have a very nice home in Henderson Nevada and thank God for giving us the prime-rate crisis as a reason for permanently putting California in our rear view mirror (‘no offense to Californians…’its just that your taxes are too high and your politicians are too crooked…’and all of them are certifiably goofy).

Without ANY apparent “credit worthiness” we’ve managed to acquire credit cards (secured and unsecured), and to finance several nice automobiles. ‘Over the years, I must say, that we just haven’t suffered much, even in view of losing 53 properties and a couple million in equity: due largely to having very little invested: ‘as the properties were all acquired without down payments, without new mortgages; and our resident beneficiaries paid all the bills (‘i.e., until they couldn’t do so any more… ‘at which time the properties went back to their original owners, for their decision as to whether they wanted them back, or preferred to let them go to foreclosure (‘virtually all went the foreclosure route, but there were no loans in my name and I was not on single title…’my corporate trustee was and was beyond all responsibility and recourse).

The upside of it all is…’well…’what all losers say when they finally get back on their feet after a losing streak:  “Aha!  Now I know what to do the next time this happens (‘although, providence will probably figure out another prank with which to punch me in the gut until I get the point).”

And that point is a simple one: The prudent person should do everything in his or her power to get their credit in order; but in the meantime, ‘never let the absence of credit negatively interfere with, or affect, their investment pursuits.  One simply does not need cash OR credit in order to be a successful real estate entrepreneur… ‘assuming a good grasp of their intentions, and a good escape plan, when starting…’and assuming you have a solid source of information, education, know-how, mentoring and coaching, and a source for sound and dependable advice and encouragement.

Following–‘in the order of their overall importance–are the tools you need in the No Down, No New Loan, real estate investing business:

  1.  An honest dissatisfaction with the status quo
  2.  A burning desire to achieve
  3. An honest NEED for increased abundance. I.e., ‘if you DON’T NEED it…’you won’t get it!  ‘Without needing (‘having a burning desire for it) you only have wishing, hoping and dreaming to depend on, ‘which are each on par with horse-racing and crap-shooting as far as attaining is concerned).
  4. Tenacity: I.e., ‘the undaunted ability to stick-to-it, no matter what!
  5. Resiliency: I.e., the ability to shrug off a failure (‘or several of them in a row) and move on with undiminished zeal
  6. Selling skills: Learned and/or natural sales-ability (‘i.e., the ability to listen and think at the same time; always listening more than talking; remaining 100% honest and forthright while staying unattached to the outcome)
  7. A professional and business-like demeanor re. your personal grooming and attire. E.g., a misplaced body-piercing or ornamentation can cost you millions in lost opportunities in just a few years…’without your ever even knowing that it happened, ‘much less Why
  8. A solid understanding of Real Estate and Real Estate Finance
  9. A source of available cash…or someone to call-upon who has it… or a way to avoid its necessity
  10. A real comfort in product knowledge, allowing one to “go commando” in this business.)   *Comando: No cash, no credit, No experience and perhaps Limited sobriety

In this business, without at least the first five elements in the above list, you are likely destined for failure (‘in this business).  However, with #1 through #5, ‘along with any one of #6 through #10, your chances of success are good.

With all of, say, 9 out of 10, your success is unavoidable, and abundance is already yours, and just patiently waiting for you to reach for it and demand it into you life.

The best advice anyone will ever give you: ‘Find that Self-Serving Need in your life that is feeding upon your financial deficiency and destiny…’and eliminate it ‘once and for all.  Know that anything pleasurable that you decide you can live without will always (invariably) be immediately replaced by something else that is better for you and you life’s aspirations.

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