Repair credit fast case study #10 proves that bad credit can result in the keys to your new dream home.
Recently I had the pleasure of meeting (& helping to “make”) a truly extraordinary bad credit success story ….
His name is Julio Muniz.
Julio recently “retired” from active military and desperately wanted his family to have a stable home…finally. Unfortunately, bad credit has kept him from breaking free from renting & paying his landlord’s mortgage payment.
His wife is tired of white walls and wants to decorate the kids’ rooms.
When Julio contacted me, he wanted to know more about renting to own in the Orlando (FL) area.
Naturally, I asked him about his credit. He told me it was bad. Okay, what are your scores, I asked him. He gave them (middle ~ 550ish). I asked him for the bad on his reports. He faxed them to me (something I do not recommend doing to a stranger but he did).
Click “Read More” below if you’re fighting bad credit and really want to grab the keys to your new home.
JULIO SEES DREAM COME TRUE
Immediately, I saw a judgment on his reports. Can’t miss one of those, especially when a person wants to buy a home. He told me he had paid off the judgment. I asked for proof.
Within minutes, he had faxed me the proof I needed to recommend a powerful strategy. For some reason, Julio’s mortgage professional didn’t know of this simple $35.00 strategy until I called her.
A couple days later, Julio was cleared for takeoff to pursue his dream. For so long, mortgage people kept telling him “NO.”
Apparently, they asked him the wrong questions, cuz this was way too easy. Julio called me about renting-to-own…he was convinced he couldn’t possibly take advantage of these L-O-W house prices in Florida.
He didn’t want to RENT…he didn’t want to rent-to-own…He wanted his OWN home now.
And then I surprised (pleasantly surprised) Julio and his wife with one secret from my book & videos.
- Secret #1 I shared from THE BUSY PERSON’S CREDIT MAKEOVER cleared Julio & his mortgage person how to increase Julio’s credit scores 95 points in 4 days, allowing Julio to get exactly what he always had wanted: to bank qualify by using his VA benefit, 100% financing & the keys to his new home.
Even better news is that Julio did not stop there. I shared secret #2 with him that would improve his credit scores even more…maybe an additional 75 points!
- With secret #2, I advised Julio to pay down his credit card debt, which accounts for 30% of his (& your) FICO.
Julio and every other person with whom I talk had no clue that carrying $3,200 on a $5,000 card KILLS his credit scores. Whoa, it most certainly does hurt.
Carrying $3,200 on a card with a $5,000 credit limit means Julio had charged 64% of his available balance!
So what’s the big deal, you ask?
Do NOT carry a balance over 25% when trying to apply for new credit! Don’t do it. Keep your balance as low as possible…ZERO if possible.
The more debt you carry, the lower your scores.
30% OF YOUR FICO COMES FROM DEBT-TO-CREDIT UTILIZATION.
I’ve seen a credit score jump 75 points simply by paying down the credit cards. Don’t you think you should consider paying down your credit card debt before you try to shop for a home?
In Julio’s case (and this is what I witness in every other person who contacts me), Julio did not care one bit about going after A+ credit.
Julio and his wife Marie wanted the keys to their new home. They didn’t set out to achieve some mystical 3-digit score…it wasn’t about a 700, 800 or even that “perfect” 850.
In fact, the interest rate Julio and Marie received was only 1/4 higher than the best rate offered to an A+ credit score. Big stinkin’ deal…right?
Without doubt, Julio’s mortgage person was so appreciative too as she (who thought she knew this stuff) now gets to help a family buy its home. 
)
This is how I strategically approach the ubiquitous “credit repair.” It’s laser-focused, not scorched earth.
I do NOT believe in randomly firing off dispute letters…only to see you get sued!
I believe in finding out exactly what credit score is needed to get what I want. Then I find the necessary points on a credit report. I also add good credit for a solid bump.
Get the necessary points (by adding GOOD credit and correcting BAD credit) to allow people to get whatever they want that “good” credit demands.
Email me now if you want a Sarasota Realtor and skilled mortgage professionals who know how to help you get the keys to your new home. You might be surprised by the possibilities!
Repair credit fast & get the keys to your new home just as Julio did by STRATEGICALLY improving your credit enough to get everything you want from good credit.
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Here’s what I don’t understand, Mike. You go through bankruptcy and have the clean slate. You vow not to get involved with credit cards, loans, etc. The only expenses you want are your home, utilities, and possibly a car.
Why then, in order to get these things, do they require you to establish “new” credit? I would think they would be thrilled that you have no other obligations except living expenses and that you are frugal enough to engage in cash transactions; that you pay as you go. After all, running up credit and getting involved in this whole credit card debacle, is what gets people in trouble in the first place. When they lose a job (or a spouse), they can’t pay the bills, the creditors jack up their interest rate, late fees accrue at ridiculous increments and when your finance charges push you over your limit, you’re charged an over-limit fee when you didn’t even use your actual card.
Why is it necessary to become re-involved with credit?
Hi Sherry,
You’re right on the ‘logic” part about credit. However, keep in mind, your credit file is your “scorecard.” I will stand up to anyone who claims you SHOULD avoid credit or rebuilding a credit file.
You want proof? Let me give you just one example that fewer people are able to avoid. A lady names Patrice emailed me a couple weeks ago, saying she thought I was crazy when she first hear me talk about employers pulling an emploee’s or prospective employee’s credit. In her email, she had never heard of any employer ever doing that until….
Yep, until her husband lost his job and began interviewing. On one particular position her husband really wanted, he went through a “couple of rounds of interviews” and everything was going well. According to Patrice’s email and right in line with what I’ve said many times, right before HR offered him a position, they pulled his credit.
He knew they were going to pull his credit, because he had to give permission. However, he chose NOT to add an explanation. There was no place for him to do it, so he didn’t do it. He chose not to request to add an explanation for the “bad” credit (a 13 bankruptcy 18 months ago).
HR did not even return his calls and inquiries. The simply hired a different candidate! Of course, Patrice said her husband (and she) were devastated. She hadn’t thought anything like this was possible, especially for a position not involved with money or security clearance or upper-level management.
You see, Sherry, I hear this all the time from people determined to recover from financial setbacks. The get a bankruptcy discharged and begin to sleep better at night, vowing NEVER to use or apply for credit ever again.
And that is so BAD!
In fact, you must do the opposite. You must rebuild your credit, understanding that with a BK you are now in a “class” of people all being “scored” according to a BK. You might be surprised to see your scores actually move up in time by doing nothing.
But then, suddenly, your scores drop through the floor and you’re shocked. Why?
What now has happened is that (in time) you now have moved into a different class and your scores are competing against people who also have had a BK but who actually got to work rebuilding their credit.
Understand, Sherry, no credit file is as bad as a scorched earth credit file. You MUST rebuild your credit file to avoid job rejection/promotion, inflated insurance costs (yep, that’s right, low credit scores hammer people on health, renter’s, homeowner’s, life & auto insurance premiums).
…and higher cell phone plans.
…and higher security deposits for water, electric, cable TV & telephone plans.
I could go on but I had said I’d only list one instead of a bunch. Bottom line: you cannot run from a bad credit file, regardless of how well you might be sleeping now.
Regarding “jacked up interest rates” which again is illogical and stupid, you must be proactive and go past customer service to confront this stupidity. Typically, all I have to do when I step in to help people in this situation is to state the alternative. These creditors come to their senses pretty quickly.
Of course, you’re wondering why it takes contacting them at all. Shouldn’t they know better? Yes, they should know better.
If your bankruptcy resulted from an unforeseen financial tragedy, that’s not irresponsibility. If your BK resulted from irresponsible decisions, then you must be responsible (and that’s also something I teach and on which I counsel people with a step-by-step program).
No, it’s not a painful process, since most people I work with following a BK caused by irresponsibility come to terms with their poor decisions. They’re ready for a change…they welcome a change.
I don’t know your situation, Sherry, so I’m careful to show you both sides.
You need to earn their TRUST if you ever want to feel comfortable in a job interview, buy a car or home, or get a (decent) credit card or pay (normal) security deposits, or get a (normal) cell phone plan or…..
Are you clear now? Either you re-establish your credit or you WILL suffer. I can say this with 100% certainty. I’ve been working with people in a similar situation for many, many years now.
Best of luck to you, Sherry. Thanks for asking a great question.
Mike
HEY MIKE,
I WANT TO KNOW WHATDO YOU DO IN PLACE OF USING DISPUTE LETTERS TO REMOVE ERRORS ETC.
Laron,
Thanks for stopping by with a question. What you do depends on the errors and who’s reporting the errors. Is the “original creditor” reporting the errors? Is a debt collector reporting the errors?
How old are the accounts?
What type of accounts are they?
People have it all wrong about the role of the dispute letter. They find one of those really “lawyerly” dispute letter on some freebie credit repair website and they change a few things around and fire it off, sitting back waiting for deletions.
The result: they usually get a “verified as accurate” response letter from the bureaus and/or they get Summoned to court…they’re being sued. I wish I could be more helpful, but I don’t have any details about your specific situation.
For me to start blabbering suggestions would be ridiculous and potentially dangerous (to you). This is exactly what most credit (dis)repair companies do. They shoot off dispute letters (and you should see the type of letters most of them send out–do a search on my blog for Lexington Law Firm for a sampling of just how ridiculous they are…in secret as well.
Cheers,
Mike