Bad Credit? Stop Chasing Lenders and Start Chasing Deals That Chase You!

How to Make Your Credit Score Irrelevant by Finding “Slam-Dunk” Deals that Scream “YES!”

Let me tell you about an International Wealth Success Wealth Builder named Roberto—and I’m telling you this story because it’s going to change the way you think about money, bad credit, and building wealth forever!

Roberto came to IW$ three years ago with a credit score of 542. Yes, you read that right—542! He’d had a business failure, a divorce, and some medical bills that crushed his credit rating. He was discouraged, frustrated, and ready to give up on his dream of building wealth through real estate.

He wrote to IW$, “I’ve contacted 47 lenders in the past six months. Every single one has turned me down flat. What am I doing wrong?”

I responded to Roberto with this. “You’re asking the wrong question, my friend. The question isn’t ‘Who will lend to me despite my bad credit?’ The question is ‘What deal is so good that lenders will be fighting each other to fund it?‘”

Today, just 36 months later, Roberto controls $3.2 million in real estate. His credit score? Still under 600. But here’s the beautiful part—nobody cares anymore!

The Backward Approach That’s Keeping You Broke

Here’s what most people with credit challenges do—and I see this every single day at IW$:

1. They spend weeks researching “bad credit lenders”
2. They fill out dozens of applications
3. They get rejected repeatedly
4. They pay exorbitant interest rates (18%, 22%, even 28%!) when they do get approved
5. They settle for terrible deals just because they could get financing

This is completely backward! It’s like trying to push a rope uphill. You’re exhausting yourself and getting nowhere fast.

The Tyler G. Hicks Formula: Let the Deal Do the Talking

Now let me share the approach that’s made millions for IW$ clients, students, and friends—many of whom started with credit scores below 580: Find deals so good that your bad credit becomes irrelevant.

Sound impossible? It’s not! In fact, it’s easier than you think. Let me show you exactly how this works with real numbers, real examples, and real results you can duplicate starting TODAY.

What Makes a Deal “Lender Proof”?

A lender-proof deal has specific characteristics that make lenders say “YES!” regardless of your credit history. Here are the golden numbers you’re looking for:

The 75-50-25 Rule for Real Estate:

• Purchase price at least 25% below market value
• Positive cash flow from day one (minimum $250/month per unit)
• Loan-to-value ratio of 75% or less
• Debt coverage ratio of 1.25 or higher

Let me break this down with a real example that one IW$ BWB, Maria, completed last year in Cleveland, Ohio.

Maria’s Cleveland Duplex Deal:

• Market value: $185,000 (based on three recent comparable sales)
• Her purchase price: $127,000 (31% below market!)
• Needed repairs: $18,000
• Total investment: $145,000
• After-repair value: $185,000
• Loan amount needed: $109,000 (75% of purchase price)
• Monthly rental income: $2,400 (both units)
• Monthly expenses (including mortgage): $1,850
• Monthly cash flow: $550

Maria’s credit score? A dismal 538. But here’s what happened when she presented this deal to lenders:

She contacted exactly FIVE lenders. Four of them approved her within 72 hours! Why? Because the numbers were so compelling that her personal bad credit became almost irrelevant. The property itself was the collateral, and it was worth 27% more than the loan amount from day one.

The Power of the Debt Coverage Ratio

Now listen carefully, because this is crucial: Lenders LOVE the debt coverage ratio. This single number has gotten more deals approved for people with bad credit than any other factor I’ve seen in my 40+ years in this business.

The debt coverage ratio (DCR) is simple: It’s your net operating income divided by your annual debt service.

Here’s why lenders love a DCR of 1.25 or higher:

For every dollar of mortgage payment, the property generates $1.25 in income. That’s a 25% cushion! Even if vacancy rates spike or repairs are needed, the property can still cover the mortgage with room to spare.

Let me show you another real example from the IW$ files:

James’s Sacramento Fourplex:

• Purchase price: $420,000
• Monthly rent (all four units): $5,200
• Annual rent: $62,400
• Operating expenses (50% rule): $31,200
• Net operating income: $31,200
• Mortgage needed: $315,000 (75% LTV)
• Annual debt service at 8% interest: $27,720
• Debt coverage ratio: 1.13

James came to IW$ excited about this deal. We told him, “James, this won’t work with your credit score of 567. You need a DCR of at least 1.25.”

So James went back and negotiated harder. He got the seller down to $390,000. Now look at the numbers:

• Mortgage needed: $292,500 (75% of $390,000)
• Annual debt service: $25,740
• Net operating income: $31,200 (same as before)
• NEW Debt coverage ratio: 1.21

Still not quite there! But James is clever. He found out the property had been vacant for two months because the previous owner was a terrible landlord. James convinced a quality tenant to move in BEFORE closing, pre-leasing one unit for $1,400/month instead of the previous $1,200.

Final numbers:

• Monthly rent: $5,400
• Annual rent: $64,800
• NOI: $32,400
• DCR: 1.26

BINGO! James presented this revised deal to three lenders. Two approved him in less than a week. His bad credit score never came up in the final negotiations!

The “Equity Cushion” That Makes Lenders Sleep Well at Night

Here’s another powerful secret: Lenders are far less concerned about your bad credit when there’s substantial equity in the deal from day one.

Think about it from the lender’s perspective. If you default on a loan secured by a property worth $200,000, but the loan is only $130,000, the lender has a $70,000 cushion. They can foreclose, sell the property at a discount, and still make their money back with interest.

My recommendation for bad credit borrowers: Target deals with at least 20% instant equity, preferably 25-30%.

Here’s how my client Dennis did this in Phoenix: Dennis found a distressed seller who needed to move for a job opportunity. The property was worth $275,000, but the seller accepted $198,000 for a quick close. That’s 28% below market value—instant equity of $77,000!

Dennis needed a loan of $148,500 (75% of purchase price). Even though his credit score was 559, he presented this to a local portfolio lender with these talking points:

• Instant equity of $77,000
• Loan-to-value of only 54% based on appraised value
• Property could be sold for $250,000 tomorrow (even below market) and lender would still be protected
• Cash flow positive from day one ($425/month)

The lender approved him in five business days. Dennis’s bad credit score never entered the conversation after the initial application!

Where to Find These “Lender-Proof” Deals

Now you’re probably asking, “This sounds wonderful, but where do I find deals this good?”

Excellent question! Here are the seven sources where IW$’s most successful BWBs and AWBs find their best deals:

1. Motivated Sellers in Life Transition

• Job relocations
• Divorces
• Inherited properties
• Retirement downsizing
• Health issues requiring cash

2. Tired Landlords

• Owners who’ve dealt with problem tenants
• Out-of-state owners who can’t manage effectively
• Landlords reaching retirement age
• Estate sales from deceased landlords

3. Pre-Foreclosure Properties

• Homeowners behind on payments
• Properties with notice of default
• Auction properties (before auction date)

4. Expired Listings

• Properties that didn’t sell with realtor
• Seller now more motivated
• Often willing to negotiate significantly

5. FSBO (For Sale By Owner)

• Sellers saving on commission
• Often inexperienced in pricing
• More flexible on terms

6. Off-Market Direct Mail Campaigns

• Target specific neighborhoods
• Focus on high-equity owners
• Long-term relationship building

7. Wholesalers and Bird Dogs

• Professional deal finders
• Already negotiated below-market prices
• Quick closing often required

The Outrageous Truth About “Bad Credit” Lending

Here’s something that might shock you: Some of IW$’s most successful lenders PREFER working with borrowers who have bad credit challenges!

Why? Because borrowers with perfect credit have options: They can shop around for the lowest rates. They’re not loyal. They’ll refinance the minute they find something better.

But when you bring a fantastic deal to a lender—a deal with strong cash flow, significant equity, and solid numbers—and that lender approves you despite your bad credit challenges, you remember that. You bring them your next deal. And your next one. You build a relationship.

I know a portfolio lender in Memphis who told me he’d rather lend to someone with a 580 credit score and a great deal than someone with a 780 credit score and a marginal deal. “The 780 score will refinance with a big bank the moment they can,” he said. “The 580 score becomes a client for life.”

Your Action Plan: The Next 30 Days

Let me give you a concrete 30-day action plan to find your first lender-proof deal:

Week 1-2: Research and Education

• Study your target market (pick ONE city or neighborhood)
• Determine true market values (analyze 50+ recent sales)
• Identify average rents (call 20+ landlords and property managers)
• Calculate your numbers (know your ratios cold)

Week 3-4: Deal Hunting

• Contact 10 FSBOs per day (200+ properties total)
• Send direct mail to 500 targeted owners
• Network with 5 wholesalers
• Check expired listings daily
• Drive target neighborhoods weekly

Your goal: Find ONE property that meets the 75-50-25 rule. Just ONE!

When you find it, here’s exactly what to do:

1. Get it under contract (subject to financing and inspection)
2. Prepare a one-page deal summary with all the numbers
3. Contact 5-10 portfolio lenders (not big banks)
4. Present your deal with confidence
5. Let the numbers do the talking

The Beautiful Secret Nobody Tells You

Here’s the secret that will set you free: Once you do ONE deal successfully with bad credit, the second deal becomes exponentially easier.

Why? Because now you have:

• A track record (even if it’s just one property)
• A lender relationship
• Experience and confidence
• Proof of concept

IW$ BWB Sandra did her first deal with a 547 credit score. It took her four months to find the right property and three weeks to get approved. Her second deal? Found in six weeks, approved in eight days. Her third deal? Found in three weeks, approved in 72 hours—with the SAME lender who trusted her because of deals one and two. (FYI: Sandra found this lender in ATTAIN!)

Today, Sandra controls seven properties worth $2.1 million. Total time: 29 months. Her credit score? Now up to 680, but she didn’t wait for that improvement to build wealth!

The Numbers Don’t Lie—Your Credit Doesn’t Have To Be Perfect

Let me leave you with this powerful thought: A property with strong cash flow, significant equity, and solid fundamentals is like a tree that bears fruit year after year. The lender isn’t betting on YOU—they’re betting on the TREE.

Your job isn’t to convince lenders you’re creditworthy. Your job is to find trees so laden with fruit that any lender would be foolish to pass them up.

Stop wasting time on lender searches. Start spending that time on deal searches. Find properties that are 25-30% below market value. Target debt coverage ratios of 1.25 or higher. Look for situations with instant equity and positive cash flow from day one.

When you present these deals to lenders, your bad credit score becomes a footnote in the file, not the headline of the decision.

Now get out there and find your first lender-proof deal! The wealth you’ve been dreaming about is waiting for you—and it’s closer than you think!

P.S. Remember Roberto with the 542 credit score and $3.2 million in real estate? His credit score is now 695. But you know what? He hasn’t checked it in 18 months because he’s been too busy finding great deals! That’s the spirit of a TRUE wealth builder! Now go do the same!