financing secrets of a millionaire real estate investor.pdf

56 FINANCING SECRETS OF A MILLIONAIRE REAL ESTATE INVESTOR
“I Don’t Like Credit Cards—Should I Pay
Them Off and Cancel Them”
Never pay off completely or cancel a credit card!
A person with no credit at all is worse off than a
person with a bad credit history. You may think
that credit cards are evil, but you may not be able
to get a phone, a job, or even a utility account
without a credit score. A person with an empty
credit file looks somewhere between “suspicious”
and “scary” to a company inquiring about your
credit. Have a credit card or two, and use them
once or twice a year, even if it is just to pay to fill
up your gas tank.
Your Provable Income
FNMA loan regulations require proof of requisite income to support
the loan payments. Proof of income requires strict documentation,
such as
• two years of W-2 forms,
• past two pay stubs, and
• two years of tax returns.
If you are self-employed, or at least a 25 percent owner of a business,
you need to show that you have been in business at least two
years. Proof of self-employment requires copies of tax returns showing
the business income.