Getting Started: Build Your Power Position Early

Whether you’re buying a residential property or securing a commercial asset , your strength starts with preparation. Here’s how to build financial credibility and gain maximum leverage from day one.

1. Build Your Financial File

Before any lender says “yes,” they need to understand your full financial picture. Create a digital or physical folder that includes:

Residential Buyers
• Last 2 months of bank and investment statements
• Last 2 years of tax returns
• Recent pay stubs (or profit/loss statements if self-employed)
• Credit card, auto loan, and student loan balances
• Government-issued ID and proof of assets
Commercial Buyers (in addition to above)
• Entity documentation (LLC, Corp filings, etc.)
• Operating agreements or partnership info
• Existing rent roll (if applicable)
• Business tax returns and/or personal guarantor financials
• Commercial P&L and balance sheet (if using business income)

Treat this file like currency. It’s your leverage when the numbers matter

2. Know Your Credit Power

Lenders use your credit score to determine your risk and your rate. Here’s the current breakdown:

• 740+ = Excellent (best rates)
• 700–739 = Good
• 660–699 = Fair
• 620–659 = Minimum for most conventional loans
• Below 620 = May qualify for FHA, but with limits

Want to improve your score? Start by paying down credit card balances, avoiding new credit inquiries, and making on-time payments across the board. You can check your credit for free through annualcreditreport.com, and you’ll find the major bureaus below:

Equifax – equifax.com – 800.685.1111

Experian – experian.com – 800.392.1122

TransUnion – transunion.com – 800.888.4213

Tip : Check your credit for free at annualcreditreport.com. Want to boost your score? Pay down revolving debt, avoid new credit pulls, and stay consistent with on-time payments.

3. Pre-Qualification vs. Pre-Approval: Know the Difference

Not all lender letters are created equal.

Residential:
• Pre-Approval is the real green light. It means a lender has reviewed your credit, income, and assets, and confirmed how much they’re ready to lend. This shows sellers you’re financially serious and offer-ready.
• Pre-Qualification is a surface-level estimate based on unverified info. It’s fast but it doesn’t carry much weight.

In this market, pre-approval isn’t just smart it’s a competitive advantage.

Commercial:

While commercial lenders don’t issue traditional pre-approvals, term sheets or letters of interest (LOIs) based on your submitted financials show intent and credibility. Get your documentation in early so lenders can move fast when it counts

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4. Savings & Smart Debt Management

Start stacking cash not just for your down payment, but also for closing costs (appraisals, title, inspections, etc.) and reserves. Lenders love to see liquidity.

Also: pay down high-interest, revolving debt like credit cards. Reducing your debt-to-income ratio (DTI) can significantly improve your loan terms and increase how much home you can afford.

5. Don’t Rock the Boat: Stay Financially Still

Now is not the time to switch jobs, move large amounts of money, open new credit cards, or finance a car. Lenders want stability.

For example:
• A $500 monthly debt payment (like a credit card or car loan) could lower your buying power by as much as $80,000–$85,000 on a 30-year mortgage at today’s rates. • A sudden drop in liquidity can stall a commercial deal even if your income looks solid.

Bottom line: Don’t make moves without talking to your lender (or me). We play to win—and that means not giving the underwriter a reason to second-guess

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