Why is my credit score getting tanked every time I take out a loan? How can I get more loans when I’m buying all these properties?? These are questions I get constantly.
When getting loans from a bank, there are two major keys to help keep your credit score intact.
1. Take out the loan as an LLC or a company. This way, your personal name stays off the loans docs.
2. When you are taking these loans out, the bank will require a personal guarantee. Therefore, your name will be on it. HOWEVER, there’s a big difference between a co-borrower and a co-guarantor.
A co-borrower means you’re taking the loan in your name and this will reflect on your credit report. If you sign as a co-guarantor it will NOT go onto your report, keeping your score intact and allowing you the ability to get more and more loans.
So just keep this simple trick in mind and ALWAYS sign as a co-guarantor, NOT a co-borrower. Happy investing!