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Eric Workman, one of the most frequent guests on the Straight Up Chicago Investor Podcast, returns to break down something that’s often overlooked—but absolutely vital—in the real estate game: your credit score. This episode dives deep into the small credit missteps that can create large financial consequences for Chicago property managers, investors, and anyone looking to scale in real estate.
From missed $30 payments to misunderstood HELOC usage, Eric shares insight into how lenders evaluate credit. He also discusses how seemingly minor blemishes can tank your loan terms, and why even high-net-worth individuals must stay sharp when it comes to credit strategy. Whether you’re managing a large rental portfolio or just getting started, this episode will make you rethink your financial hygiene and how it impacts your next deal.
Questions We Answer in This Episode
Q: How does a missed $29 payment affect your ability to get approved for a real estate loan?
A: Even small missed payments can significantly damage your credit score, dropping you below key thresholds. That $29 oversight can lead to higher interest rates, lower LTV offers, or outright denials.
Q: What’s the most common credit mistake among real estate investors?
A: Failing to monitor credit utilization. Maxing out cards or ignoring payment due dates—even on unused cards—can seriously damage your score. Always keep usage below 30% and automate minimum payments.
Q: What credit score do most lenders expect from serious Chicago investors or property managers?
A: Eric notes that for over $400 million in loans made, the average borrower has a credit score around 752. Falling under 700 instantly raises red flags for lenders, no matter how great the deal.
Q: How can landlords in Chicago increase their credit scores quickly?
A: Routinely ask to increase your credit limits, keep accounts open (even unused ones), pay down balances, and ensure all bills—especially small recurring ones—are auto-paid. These small efforts boost utilization ratios and long-term score health.
Q: Can your credit score limit your ability to scale a property portfolio?
A: Absolutely. If your score is below threshold, you may need to bring in a financially stronger partner. Credit influences both the amount you can borrow and the cost of that capital.
Q: Should you ever close an old credit card account you no longer use?
A: No—closing an old account lowers your average account age and available credit, both of which negatively impact your score. Use it once a quarter for small purchases to keep it active.
Q: Is a high HELOC balance bad for your credit?
A: Yes. HELOCs are revolving credit lines and appear on your credit report. A near-maxed-out HELOC tells lenders you're overextended—even if you're technically current on payments.
Q: How do inquiries from car dealers affect your credit profile?
A: Multiple hard pulls within a short period (like car shopping) can seriously ding your credit. Always ask dealers to submit to just one lender.This helps keep your credit profile strong.
Q: What tools can landlords use to monitor credit?
A: Credit Karma is a great free tool for trend tracking. While it may not show the exact score used by lenders, it gives actionable advice on how to raise your score based on payment history, credit utilization, and inquiries.
Q: Can I partner with someone who has good credit to offset mine?
A: Only if that partner is also contributing capital, experience, or resources. A “credit-only” partner doesn’t move the needle with most lenders. Bring in a credible investor to balance the risk.
Q: What is the best long-term strategy for a Chicago property manager to stay credit-worthy?
A: Pay all bills on time, keep utilization below 30%, don’t close old accounts, monitor trends monthly, and never let small bills go to collections. Lenders look at history, habits, and available credit.
Show Notes
00:00 – Eric Workman joins again to discuss financial discipline and credit score strategy for investors
01:00 – Why credit scores matter more than ever in Chicago’s real estate financing landscape
02:11 – Real-world stories: $29 missed Home Depot payment derails financing.
03:43 – How auto-payments and limit increases protect your score
04:37 – Credit card utilization ratio: the secret killer of great credit scores
05:28 – HELOC impact on credit scores explained
06:03 – Why sub-700 credit scores raise red flags—even with capital
07:07 – Lender perceptions of net worth vs. credit score
08:17 – Strategies for young investors with limited credit history
09:09 – Importance of sweat equity and strong partners when starting out
10:21 – How to monitor and improve credit using free tools like Credit Karma
11:17 – Avoiding unnecessary inquiries during car shopping
12:14 – Chicago fact trivia and giveaway sponsored by Renovo Financial
Takeaways for Chicago Property Managers and Landlords
Eric Workman’s insights go far beyond investor tips—they’re tactical, actionable steps that any Chicago property manager can use to boost financing potential, protect cash flow, and secure better loan terms. Here’s how to put it into practice:
- Monitor your credit monthly. Don’t wait until loan application time. Know your numbers in advance.
- Automate payments for all utilities and minor recurring bills. These are the ones that tend to get missed.
- Increase your credit limits every 6–12 months. Lower utilization equals higher scores.
- Educate your team and tenants. Property managers should teach staff and residents about how credit affects housing and lending.
- Stay bankable. Your future acquisitions and refi terms depend on the credit actions you take today.
Guest Info
Name: Eric Workman
Company: Renovo Financial
Website: Renovo Financial
Because finding good tenants and property management shouldn’t feel like online dating.
Dear Investor,
If you are an investor in either the city or suburbs of Chicago, I would love to speak with you about how we can help you on your real estate journey. At GC Realty & Development LLC, we help hundreds of Chicagoland real estate owners and brokers each year manage their assets with both full service property management and tenant placement services.
We understand that every investor’s goals are unique, and we love learning about each client’s individual needs. If there is an opportunity to help you buy back your time by managing your rental property or finding quality tenants, please check us out.
Best Investing,
Founder, Partner, Podcast Co-Host, and Investor
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