Somebody has bad credit. What can they do to improve that? You have to have at least
a 620 credit score for anyone to really give you anything. You have to have
a balance and make payments on it so that you can show hey I'm a responsible adult, I'll make my payments.
You talk a lot about credit. I do, personal credit, business credit, cruddy credit, good credit.
Somebody has bad credit, what can they do to improve that? Is there something they can do
right away to improve their credit? Absolutely. So like I said, I started with bad credit, terrible
credit. I literally when I decided I was going to be a real estate investor, I was in my parents
basement, we had multiple foreclosures, bankruptcy, no money, I had no job. Just the worst situation
ever and I wanted to invest in real estate so I'm going to these real estate conferences and he's
telling me about flipping houses and he tells me, my coach, you're going to have to fix your credit.
You will. There's things that you can do with bad credit and I did those things and made
money but eventually if you want to start owning and buying houses, you got to fix your credit
and so he starts giving me all of these little ways. And so one of the ways was adding myself as
an authorized user on someone else's credit cards, that'll get you some points, that'll get you some
new trade lines. You want to do credit cards that you know the person doesn't really use,
you want to use credit you know credit lines that have a good high limit you know and they're always
paid on times. This is- you have to be careful. So my dad had like a few credit cards that he never
really used so he added me as an authorized user to like three credit cards. My credit score went
up almost 100 points with just those three credit cards. Okay so he added me as an authorized
user to a Chase, an American Express and like a Federal Credit union he had. Okay so those three
credit cards and now all of a sudden I'm getting some more points. I was like okay then my coach
tells me you also you gotta get some new credit going, you know what I mean? It's one of the things
to if you have bad credit to go to good credit, you need some trade lines that are good and you
need some new people lending you money. Okay that's what the credit agencies are looking for like okay,
someone's recently lent you some money. So, he gives me a couple of secured credit cards and
says okay go to Wells Fargo, you give them $500, they'll give you a credit card with $500. After
a few months, they'll give you that $500 back but it's going to report immediately and start getting
you some trade lines. So I did that. He says go get a loan against your savings account. I was
like I don't have a savings account. You probably wouldn't be here.
I wouldn't be here so he said $500, it doesn't have to be a lot of money so I borrow $500 from my dad, I
tell them I'm gonna put this in this bank account and then they gave me a loan against the savings
and that is an installment trade line. Literally. Did you know this? I didn't even know this stuff
existed. Literally you go to the bank, you open up a savings account and then they give you a
loan against the savings account. Your own savings account? Correct. So basically they give you the $500
right back. Yeah, yeah, yeah. Okay but now more than anything, you have payment so I think the
payments were like 50 bucks a month or something like that but remember they gave you that money
right back. So you put the money in, they loaned it right back to you so you have the $500 still.
Okay now you can do this at other banks, you don't have to just stop there. You can do this at two
three banks without them- you know without this being an issue. Okay and so these are ways that
I got my credit score up by like 200 points in a couple of you know like maybe six, months. Six, seven
months. So you went from literally worse than zero, whatever it is. Yeah, I was like...
I was like right- I think I was like 500. like it was super low. For those who don't know,
what credit score do do lenders even begin to sniff at? You have
to have at least a 620 credit score for anyone to really like give you anything 6020. Have you fill
out an application, don't even bother. Don't even bother under 620. What's like the ideal,
isn't there a perfect score? A perfect score is 850 or something like that but a good credit score is
anything over 700, anything over 720. You know once you get kind of get over that, you can pretty much
get anything that you want. And do you suggest that people if they pay their bills
right away or do they let it go a little bit so that is there a you know I mean? Is there a benefit
to not paying off your entire balance? So yes. There are because we've always been, yes. We're
very modest and conservative. We pay everything off the minute it comes in, we don't do payments,
it's just boom. Yes, we don't have it, we don't buy it. And so that's a terrible
way to build your credit though and it's funny that's what I was taught. If you can't
afford it, don't buy it so then you can't have good credit that way. You have
to have a balance and make payments on it so that you can show hey, I'm a responsible adult. I'll make
my payments. So it depends on what your goal is. If you have bad credit and you're trying to go from
bad credit to good credit, you're going to have to keep a balance because you're wanting to show the
credit bureaus that you make your payments on time. And so yeah you're paying money on interest which
is what everyone's trying to avoid. I don't want to pay any interest. You're going to pay some interest
because it's like you're buying good credit, you know what I mean? Yeah, yeah and now should
you pay on time? Of course. Make sure none of your payments are late but from a consumer perspective,
should you also keep a balance? No. So if you're just a consumer and you're talking about just
for the world, yeah, you get your credit card, pay it off. You know what I mean? You don't need to
keep a balance, you don't need to pay interest, you really don't need credit cards so I just wanted
to be clear. Yeah so to be clear, you don't need to do those things. But if you're talking about
I am a business person or I'm an aspiring business person and I'm trying to build trying to build
credit and then I eventually want business credit because the easiest way to build business credit
is with good personal credit. Although they are two separate things, personal credit is separate
from business. There's two separate- there's separate bureaus, separate scoring systems.
Does your business have a different score than your personal? Yes, it does. They're not associated
with each other at all. In fact I have several business credit because I have several businesses.
For every business entity you have, you can build a credit profile for that entity. Are your business
purchases still credit purchases so that you can maintain the business credit score or are you at
a point where you go we want this property, write a check. No, I still use credit for most of the things.
Even though you wouldn't to. I love keeping a lot
of capital and I feel like most big businesses and people don't realize how much credit Walmart has
or Target, you know what I mean? It drives the economy. Exactly. Why would they take
their capital and use that and when they could get credit from all of those vendors and fill up their
aisles? So think about a Walmart, an empty Walmart. In order to fill up all of those aisles, they have
vendors filling up those aisles with their products and they pay them on credit. They don't
buy all that stuff from them. So that's the same way that I feel that we as entrepreneurs should
think. We should think in a much bigger way. We shouldn't think about the money that we have and
the money that our business makes and that's the money we really should use a lot
of credit because as a business, you can grow your business so much faster with money from the bank
than using your own profits. Use credit and most big businesses rely on credit and
they would never just use the money that they have on hand for all of their things. Yeah, yeah.
What a great episode. I hope you really learned a lot. Are you interested in starting
your own YouTube channel from the same person that helped me reach YouTube stardom? Well you can. Go to
betheherostudios.com and make sure you tell Nate Woodbury, my YouTube creator, that Noelle Randall
referred you. Be The Hero Studios has helped me so much in my career with YouTube. He's given me
strategy, he's helped me with recording and he's even coached me on how to do YouTube in a very
successful way. Go to betheherostudios.com, fill out an application and check it out.
You can start your new YouTube channel with the help of the same person that helped me. I just want
to make sure that you have all of the resources, all of the tools and all of the knowledge that
you need to be successful. This is Noelle, to your success. I met her. Okay her name was Lisa Sassovich
and I bought into her mentorship program. You've read their books, who else has influenced you?