I Made More Money with Bad Credit Paying 18 Percent and 5 Points

Whenever I speak to customers and investors at my conferences or while traveling I always seem to get the same sort of objections. I am always telling people how I am no different than anyone else; I made money and I lost money, more than once. The difference is....I learn from my mistakes and the next time I don't make the same mistake. One of the most profitable times in my life was during my dedicated real estate career; I say that because, at the time, that is all I did. That period also taught me about diversification and the importance of good money management, but that is another story. Anyway, during this time (the late 90's) I began to invest in real estate. The market was a good buyers market so there were lots of opportunities, however interest rates were a little higher and I had pretty bad credit. As I was growing up through high school and after my graduation, I didn't maintain my credit as I should have. Contrary to what people believe, think or say, you can fix your credit. I did but it took many years. I was able to eliminate all the bad and replace it with all good. Yet again, that's another story but you can do that to.

As far as this story goes, I identified a great place to make money in the real estate market place, most specifically rentals, and investor rehabs. The problem was I didn't have any extra cash and poor credit. So, I set out to accomplish my goal. I had to use private money; in fact I was paying interest as high as 18%, one year notes and five points. Yikes, you say. Me too!

The difference was this; if you aren't putting any money down or little money down then your return is infinite regardless of what you are paying for the use of the money. I always get the terms of the money first then I look for a deal that fits within those parameters. That way I can still make money paying whatever the terms are. That's what I did.

I bought literally hundreds of properties and then started buying multi-family properties. As I have written before, you need to move the ball along. I was able to eventually find better pricing that was still high but not as high. The point of all this is to show you that credit and using private money is a possibility that you can consider and today's financial landscape offers a great opportunity to go out and find deals.

Let's talk about no money down deals and better yet getting money back. First, there are lots of them out there. Maybe not as many no money down deals as in the past but certainly little to no money down deals are still available. When I first started out I was able to do a lot of deals that actually paid me when I closed. The key is to find someone that will deal with you. Do your homework and keep moving the ball forward.


James Dicks has been an educator on the subject of Real Estate, Stocks, Options, the Foreign Exchange Market and empowering investors to handle their own investments. James has authored numerous financial books including his most recent book Forext Trading Secrets published by McGraw-Hill as well as FOREX Made Easy Six Ways to Trade the Dollar and Operation Financial Freedom.

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