I had a wake up call in California, regarding credit and personal history following you to impact decisions and options years later.

I was under the general impression that once you get 1 or 2 credit cards, a house, a car and don't work in a field that checks your credit, then you were done needing to maintain your credit. You had everything that credit could get you. Maintaining a good credit score was mostly just a habit or point of pride after so many years of building it. I have maintained my credit as a point of pride. I didn't think I would need it again.

Ummm...not true. I saw the consequences of poor credit even for people that seemed like they shouldn't really need to worry about it. These people had other strong factors like income and recent success that would be taken into consideration.

When I was looking to escape California, my ex business partner said he really wanted to buy me out. But he couldn't due to his poor credit. He owned a home, paid cash for his cars, paid his bills...but although he REALLY wanted to buy me out he had no options. I thought "where there is a will there is a way". After all, he got to own his home by having his fiance buy it in her name using her credit. I thought "There are always alternatives".

Not always.

No bank would help him.
No hard money lender would help him.
I would not help him (and I really wanted out!)

So ex-business partner found a new business partner. New partner had a business already, he had established income. New partner was enthusiastic and really wanted to make this work.

New partner approached my owner/financing lender to try and assume my debt. He offered 20% down and was willing to go up to 10% interest rate. But unknown to me, new partner also had poor credit. My owner/financier called me and said "no way- this guys credit is awful and he has a criminal background. I am looking at a huge default and headache by taking him on." (seems the criminal background was from DUI's on the guys record.)

The new partner tried to get a hard money lender. nope. Couldn't get one. Doors were closing faster than we could think of options to pursue.

I called a realtor contact because at that point it seemed I needed to put the building on the market. The realtor said he had already been contacted by my ex business partner looking for lending help. But there were no options for someone with poor credit.

The realtor said to me "TashaC, I could get YOU a loan easily. You have great credit and rental property income. But without good credit, these guys will never finds anyone to lend them money. I know a hard money lender who lends out about four million a year, but I wont even approach him about someone with bad credit, and a criminal record? No way."

That conversation was a bit of a turning point for me. Here I had people who had established themselves, cars, houses, families, jobs and they couldn't get what they wanted due to poor credit histories. And with my ex business partner- I know it was from old mistakes years ago that he just never bothered to clean up, and never tried to establish new credit. He just stopped using credit and started paying cash. His credit score wasn't from recent credit mistakes.

It was interesting because I always figured you tried a new less appealing avenue until you decided the sacrifice was too great, or you got what you wanted. You cant get a loan with an ideal rate due to credit? You took a higher interest rate. Or you put more money down. You cant get a bank loan at all, you go with owner financing. You cant get that? You go with a hard money lender. But it seems that there is a bottom where you just cant get anything at all, and for both these guys, credit was a deciding factor.

And now- about Criminal Histories: I know a lot of people with criminal histories. Nothing chronic, just a mishap resulting in a few days in jail or court dates. Ranging from DUI's to drug dealing. It was always something that occurred in their early twenties and they have since moved on from it.

I always figured society gives you a "freebie" regarding a criminal conviction. These people I know all have families, they own cars, houses, have jobs. Consequences of their past don't seem to follow them. I thought a criminal conviction on your record resulted in someone saying "hmmm...I see that you were convicted of a minor crime back in 2002, but no other crimes since...seems that was a one time thing and not a character trait. Okay, you are approved (for whatever you are trying to do/attain)."

That seems to not be the case. Criminal backgrounds do follow you and prevent you from opportunities. The lender I discussed options with regarding the new partner, and the realtor both reacted as though a criminal background was a slammed door. There was no more discussion, no taking anything into consideration.

I'm glad I learned this because I always thought I had a "freebie" out there waiting for me. A slap on the wrist to use up with no real consequences. I figured I would use it one day. I'm glad I know now before I found out the hard way.

So those are my important lessons learned. Credit is always important, and jail time follows you forever.

And as for the property I was trying to unload? New business partner got cash from family and bought the place for what I owed. We have worked out an agreement that he will make payments to me regarding the down payment I paid. Somehow I became the bank. Where there is a will there is a way. We'll see how that works out.