FTC Merrill | Credit Score

How To Improve Your Credit Score And Get Fundable With Merrill Chandler

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FTC Merrill | Credit Score


Your credit score affects your ability to borrow money. But it’s not as simple as paying every one of your credit cards to zero every month. What’s more important is the quality of the accounts and the utilization you have. Mitch Russo discusses with Merrill Chandler how you can have the best credit. Merrill has helped thousands of borrowers become more fundable with his revolutionary technology. Join in the discussion to learn how you can have the best credit to get funded!

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How To Improve Your Credit Score And Get Fundable With Merrill Chandler

I have something to share with my coaches in the audience. As a coach myself, I realized that I had been spending about 30 minutes per session on admin because I had five applications open on my screen every time I coach a client. I had one for notetaking, my calendar, my spreadsheet, my browser, Zoom, and all past session history scattered over two huge screens. At the end of each session, I had to combine all of that into a single email to send to my client. I decided to get myself a professional coaching system, but they were all too complex and expensive. I continued doing it the hard way until I decided to build my own. That’s what I have for you. I want you to try it for free. Go to ClientFol.io and test drive it for fourteen days. No credit card required. Give it a whirl and tell us what you think. You will love it. 

Onto my guest and his incredible story. After being arrested for controlled substances, weapons charges, and spending over three years in prison, he realized that most people don’t know how to be the perfect borrower and how to access the funding they need to have a great life. He used that time while in prison to perfect the art of funding optimization, which later evolved into an entire business. Not long after, his discoveries were validated by FICO executives who loved his work and allowed him to further perfect his model. Now, his company delivers this revolutionary technology to real estate investors, business owners and entrepreneurs nationwide. Since then, he’s helped thousands of borrowers become more fundable and help them access the capital they need to fulfill their financial dreams. Welcome, Merrill Chandler, to the show. 

Mitch, thank you.

Tell us how this all got started and tell us about your illustrious time paid for by the government.

First of all, I was married for several years. I was raised in a conservative religion. I cofounded Lexington Law Firm. The single largest credit repair law firm in the country. Things were blowing up. My life was good. My wife and I got a divorce. I don’t know about you guys, but as it was for me, the spring wound up tight. The second that I got divorced, the spring unsprung. I was partying and living la vida loca and soon became a little out of control. Long story short, I was arrested for controlled substances, ecstasy. In the vehicle where I was arrested, I also happen to have an AK-47, safe, legal and registered, but it’s underneath the backseat of my Jeep Grand Cherokee. I told the officers, “Excuse me, gentlemen. There is a sporting rifle under the backseat, two 30-round magazines full of ammo. Those clips were safe perfectly.” The Feds have a process where they count the number of steps to access a weapon. However many moves it takes to get to the weapon, it adds more to your time. The fewer steps, the closer it is. The closer it is, the more time you get.

I ended up with a 3.5-year sentence. If it would just have been the drugs, then it could have been probation, a lighter sentence or otherwise locally. Because of the firearm charge, I ended up in medium security, not some lighter sentence. I was locked down for eighteen hours a day at first in Florence, Colorado, and then back East. I’m far away from home and from everybody important in my life. It was the most challenging and difficult period of my life, especially since I had three young children who had been told that I love drugs more than I loved them. Even if my priorities were all messed up, it’s just bad parenting. The first six months were devastating. I’m separated and alone.

For every new limitation, there's an equal and new freedom. For every new freedom, there is a new limitation. Click To Tweet

I was a good little Mormon boy until I went off the rails. I’d been a diligent member of my community. I knew the real estate investor marketplace. I had been helping to grow the Lexington credit repair name and brand. A felon can’t be associated with the law firm so there was a divestiture there. I ended up isolated and alone even though my partner, Jason, at Lexington put money on my books and took care of me. One of the things that he said is, “Anything that’s at Amazon, I will send to you. Anything online, I’ll have somebody research and send to you.”

Mitch, I have a deep abiding philosophy that says, “For every new limitation, there’s the equal and new freedom. For every new freedom, there is a new limitation.” I’m in four walls, eighteen hours a day but with everything I could ever possibly want to study, read and research. I have a serious moment of what’s the rest of my life is going to look like. Professionally, I loved what I was doing, but I saw the insufficiencies of credit repair. You write a couple of letters and hope something comes off. Lexington may be keeping its promises to clients, but it wasn’t putting money in the client’s pocket. It wasn’t making them ready for a mortgage, getting an auto loan or getting a good credit card. It didn’t prepare them for any of that. All of this started percolating inside of me. When I came out, I wanted to be in the consumer finance business. I loved what I was doing, but I wanted to make a difference. I wanted it to be different. Nobody was helping borrowers borrow. No one was packaging them, shaping them and getting them ready to meet the underwriter’s approval formulas.

With all of this research and all this opportunity, I drill down. It was a cross-section between Beautiful Mind and Good Will Hunting because I had a golf pencil and an 8X6 foot canvas of painted wall. I’m outlining and creating all this, connecting dots. I’d asked for more research and then I’d get the research, read and connect more dots. All of a sudden, I’m like, “This is doable. It’s a thing.” I don’t want to be so grandiose to say I was reverse-engineering the FICO algorithm, but I was seeing what lenders were approving and what lenders weren’t approving, and what kind of credit profile you needed or what we now call a borrower profile because it’s bigger than your credit. It’s who you are as a borrower.

I started outlining what the avatar for banks is. Who is the bank’s perfect customer? I start building the avatar. It wasn’t my clients. It would be the people that banks want to work with. Through this whole process, 3.5 years devoted to tweaking it and creating it. By the time I get out, I’m ready to go to town. What do I do? I go to my old partners and say, “Have I got the next best thing for your clients.” Remember, they’re writing dispute letters, but they’re not optimizing funding capability. They’re like, “That sounds great, Merrill, but our model is awesome. We’re going to keep going here.” I started Get Fundable and spent the next ten years proving out this model with clients.

I have a few things that struck me as you were talking. The first thing is when you were in prison and you were thinking about this problem, I assume that you came into prison knowing that this problem existed. What I heard is you were helping people repair their credit, but you realized that that was not solving the problem that you believe they had. They would come to you and say, “I have a credit problem.” You would say, “I can help you fix that.” Once they attempted to or began the process of fixing it, they now had a new problem, which meant even though their credit was getting better and maybe even fixed, they still could not get their business, their home, their projects or whatever funded. Getting fundable can’t be one of those things where you wake up one morning and go, “I wonder if I could help people get fundable.” You led to this.

It’s over the course of three years. It wasn’t like a week’s epiphany.

We need to get a copy of our report, but make sure it's the right one. Click To Tweet

I understand now as far as your story about how this all happened. One question to add to curiosity. When you have a weapon underneath a seat in the back, what inspired you to tell the police that you had this?

As with most authorities, including children to parents, the admission of something is deemed less horrible than the discovery of something. I went straight back to my early childhood raising that if I was mean to my sister, I knew that if I could get to my mom before my sister did and spin the story to be at least a little gentler on my case, I would have a better result. That’s why I got Federal time. It’s because I was in the airport when I got pulled over. I get out of the car and a guy grabs my arm, throws me on the ground, puts a boot on my cheek, points a gun at me, and says, “Merrill Chandler, you’re under arrest.” No joke. I’m completely serious when I say this. This is how blind I was about what I was doing. The first words I said was, “They’re taking their traffic laws seriously.” I was so stupid to put ecstasy in a vitamin bottle. Call me a dumb man.

I say this a lot. I say it not just to my audience but to everyone. Everything happens exactly the way it was supposed to. While we don’t know why something happens to us or through us sometimes, we later see the effect of that on our lives.

I’m a believer in that, Mitch. To all the thousands of borrowers I’ve helped, you’re welcome. I needed the limitations so that I could experience freedom elsewhere. I wasn’t a meditating man. I wasn’t highly introspective. I’m contemplated, but I didn’t spend time meditating and researching all this stuff unless I’m in a closed space, then all of a sudden, I got nothing better to do. Now, we develop an entirely new technology that can transform our relationships with lenders.

Let’s talk a little bit about the application or that technology. You and I are both members of the Board of Advisors. It’s a mastermind. We met through that. We’ve had several conversations. You offered me a free session to help me understand my FICO scores. Under my breath, I laughed a little bit because I knew something you didn’t know. I knew that my credit was perfect. The reason I know that is because I have this simple system, which everybody should use. Before I say that, my system is simple. I sign up for where everything that I owe gets paid automatically by my bank. My thinking was, “How could I possibly have bad credit? I never have a late payment for thirty years.” It was on my report. What ended up happening is in the process of doing this, I discovered that while I did have good credit, I didn’t have the best credit I could have for the life that I lead and the way I lead it. That’s what we spent doing the last hour before this interview. What I’d like to do is for you to help readers understand exactly what their credit score is about, and how that affects their ability to borrow money. Let’s start at the beginning just like you would when you did with me and a new client. Where do we start?

The first thing we got to understand is that your credit score is not what is used to approve you for funding. It is the 5th or 6th consideration when evaluating your credit application. Everybody’s been led to believe, “I’ve got an 800-plus credit score.” I’m like, “What are you successfully taking down when it comes to business lines of credit, business loans, or commercial property?” It’s unsecured. They did income types of applications. The first rug that I pull out from underneath people is I’d rather have a 720 credit score that’s fundable than an 820 just for having the score. You can have a deceptively high score. When we looked at your profile just like we would with anybody when we do it on audit, we call it a credit report or fundability audit. What we’re looking for is the quality of the accounts and the types of balances or utilization that you have.

FTC Merrill | Credit Score
Credit Score: A negative indicator is almost as damaging to a perfect profile as a 30-day late or a collection or a bankruptcy.


As we find, you’re not alone. You pay every one of your credit cards to zero every month, and yet you had a deceptively high balance being reported to the bureaus. The reason is there’s a reporting date. If you don’t have good balances on the reporting date, you get stuck like you’re carrying balances. It’s complete BS. The system is designed to support lenders, not borrowers. That’s why we got to learn the game. What we did was we reviewed the quality of your accounts, the types of balances that you’re carrying even though you didn’t know you were carrying balances. There are some inaccuracies that you have a perfect payment history. What most people don’t know is that FICO has negative indicators. A negative indicator is almost as damaging to a perfect profile as a 30-day late, collection or bankruptcy. It drags down your fundability, but it’s going on behind the scenes. Your account says, “Paid as agreed,” but the negative drag says it’s a high utilization or it’s not reporting the same balance across all three bureaus. There are 40 things that FICO measures. The most important thing for our readers is to remember that your credit score is not the thing. The thing is how you’re tracking the 40 borrower behaviors that they measure over the last 24-month period. That’s what they’d approve you on.

What I’m hearing is the first thing we need to do as potential borrowers or as consumers even is get a hold of our credit report. There are these services that offer like FreeCreditReport.com, are those okay? 

You got to understand, there are FICO scores, which 90% of every single lending decision you will ever experience in your whole life use FICO. There are what I call FAKO scores. If it doesn’t have the FICO logo, if it’s Vantage or there are 4 or 5 different models out there. Why get a score that a lender is not going to use to approve you? The place that I send everybody is MyFICO.com. You are going to find 28 FICO scores. You’re going to see your mortgage score, auto scores and credit card scores in real-time. You get to see the things that lenders use to grade you. Anything else is a waste of your time. We got to get a copy of our report, but make sure it’s the right one. People will say, “I get Experian. Is that okay?” No. Just once, get a myFICO report, cancel it after you buy it. There is the truth as lenders see it. You can’t know if you’re going to get approved unless you’re looking at the scoreboard that lenders are looking at.

Someone downloads it, they get their report, and they’re looking at it. What should they look for first?

What is being reported as your utilization. It’s on the second page. If your utilization is 20% or higher, you already have a huge negative indicator counting against you. We have algorithms for our clients and our students. Your particular case could be as low as 1%. It could be 12%. Every profile has a different utilization number that is specific to your situation. The bottom line is anything over 20, you are off the reservation. Here’s what’s crazy important. Mitch, as you did, you pay your things off every single month and yet you had an artificially high utilization. Don’t believe the fact that you pay your bills on time to zero every month. What’s being reported against you and what’s being scored against you is what’s listed on that document. You’ve got to believe that document and then operate from there.

I check my utilization. It’s high. I could fix that simply by making a second payment every month so instead of making once a month automatic payment, I call my credit card company and say, “Could you set up a second payment for me mid-month? Bring it to zero mid-month every month, and then at the end of the month, do it again.” That fixes utilization.

If the data points are perfect, they will fit the automatic underwriting guidelines. Click To Tweet

Depending on the amount of traffic, the number of swipes they do. Every Tuesday, my team pays mine down to zero because we put a lot of traffic for our business or otherwise. The idea is to never let it go over 20%. There’s a way to calculate your perfect utilization.

Step one, we got the utilization taken care of. That’s not too hard to do it sounds like, but if you don’t know about it, you can’t do it. Let’s go one level deeper. We got utilization taken care of. What’s the next thing that somebody should look for?

Three bureaus run the FICO algorithm. If there are more than twenty points between your highest and lowest of those three scores, you’re going to get kicked out into manual underwriting, which means full doc. They’re going to ask you for your paychecks and your taxes. You want to be under ten points. Anything over twenty, you need help. There’s that measurement. There are three versions of the FICO software. We reviewed it on your profile. There’s auto 542, auto 8, and auto 9. There are three versions of software and three credit bureaus. You have to make sure you’re within ten points between bureaus and ten points between software versions because when you go get an auto loan or credit card, you don’t know what bureau they’re pulling or what version of the software they’re using. We’re in the dark.

To be clear, this was something I learned during our time together. Everyone knows there are three credit bureaus. That seems like common knowledge. Somehow, I never asked the question why there are three. After all, if you have a score, you have a score. You started to discuss the fact that these are regional companies. They might even be competitive in some ways so they price their services competitively. Let’s say, car dealers. One might be less expensive, so they’ll use that one. I didn’t know that.

There are three bureaus because, through the ’90s, there was this land grab. Everybody was buying merchant associations. In fact, South Florida had a huge merchant association where they all did the credit reporting locally. In the ’70s and ’80s, they didn’t use Experian, TransUnion or Equifax. It was Florida Merchant Association. That was the credit bureau that the local merchants check to verify local residents. There were dozens of them around the country. All of those got swallowed up by the big three. There are centers of influence. They all are available to all merchants. Chase is all over the country. They have the ability to pull Experian, TransUnion or Equifax. They all compete head-to-head. There are certain spheres of influence based on your geography.

At this point, we know that we need to align our scores on these three credit bureaus. I’m staring at my FICO report. What do I look for next? 

Let's build relationships between borrowers and lenders so that we can all profit together. Click To Tweet

We optimize horizontally between bureaus. We optimize vertically as viewed on your credit report between score versions, the versions of the software. Once you do that, then you’re looking for material differences. A material difference is an old account. It still reports that an account is open and it’s been closed for a dozen years. If it shows open but it’s supposed to be closed, that’s messing with your fundability because of the data inaccuracy. You’re going to be looking between all three bureaus, each account, and you want them to be identically reported in every data field. If it’s not, you need help. Notice how this isn’t credit repair, but it’s still material to what’s being reported on your profile because the scoring algorithms look at everything. Think of it this way. Let’s say a positive account can give you 5 or 50 points to your score, depending on its accuracy and all these things we’re talking about.

You see paid as agreed, but FICO only giving you five points. No wonder you have a 720 instead of an 820. It’s not fundable because if there’s more than a twenty-point spread, lenders don’t trust the data. That’s when they make you fess up and bring your W-2s, your paychecks, and your tax returns. They got to validate the numbers. This is what I developed in prison. If the data points are perfect, they will fit the automatic underwriting guidelines. Your readers, the hundreds of thousands of them, you have been approved in 30 seconds or less for a credit card. No human being looked at that. They looked at your data and said, “This is accurate enough to give them $5,000 or $10,000 or $$20,000.” Many of your readers have received an email or a letter from the bank going, “Congratulations. We gave you another $1,000.” No income statements, no credit pull, nothing. You fit the underwriting guidelines perfectly for them to give you more free money. Imagine a business line of credit up to $100,000 growing on its own for use in your coaching environment and marketing. Imagine business lines of credit that followed the same rules. That’s what we do for our people.

Readers, we are talking to Merrill Chandler. He has an incredible system for helping you get fundable. This is the tip of the iceberg of what he does. At this point, if you like what you read and you’ve learned something, I’m going to give you a way to check out Merrill’s stuff for free. We’re going to shift gears a bit, Merrill. It’s a fun game that we play with our guests. We like to ask them personal questions. There are two reasons why we do this. The first reason we do this is because I am personally interested in the answers. I find it entertaining and exciting, but it also helps us understand you better. Let’s start with the first question. Who in all of space and time would you like to have one hour to enjoy a walk in the park, a quick lunch or an intense conversation with? 

As I percolate, because you gave me a heads up on that, there were two people that popped up for me. The first most important one would be Einstein. There’s another guy who connected dots that had never been connected ever before in the history of humanity. He’s a patent clerk, but he’s connecting dots. His mind was built to notice and observe certain phenomenon and go, “What if those are related?” Einstein, probably in the first twenty years of his career because he got wise and more of a sage in the latter part of his career. I would love to see him when he was building his theories. That would be so much fun to be cracking out at night while he’s doing the Math and figuring it out. I work on my whiteboard. He is a hero of mine. I love that idea. My second person was a fictional character. It’s Neo of The Matrix. Another dot connector. Another guy was not satisfied with the way things are. There’s this thing that keeps picking at you saying, “It could be different.” Thank you for allowing me to have two. Those are the two. There’s a kinship in why they’re important to me. My favorite hero of all time is Neo. Neo didn’t spend much time at a whiteboard. Einstein did. That reminds me of my days in developing my ideas on the prison cell wall.

Only for you, Merrill, do you get two. Everyone else gets one.

Thank you.

FTC Merrill | Credit Score
Credit Score: The idea is to never let utilization go over 20%.


I do like your choices. We’ve heard Neo before, but I don’t think we’ve had Einstein. As amazing as that sounds, when I asked this question, a lot of guests do have similar answers. Here’s the interesting thing. One person might name the same person as another, but for completely different reasons. That’s why I love this question. Here’s the second question and this is what we call the grand finale. It’s the change the world question. What is it that you are doing now or would like to do that truly has the potential to literally change the world? 

That’s easy for me. I’ve dedicated my life to it since I got out of prison. I want to transform the borrower-lender relationship. I want it to be a partnership rather than be adversaries, them versus us. I am committed. Everything that I’m doing is designed to build relationships between borrowers and lenders so that we can all profit together.

I had a feeling I knew what your answer was going to be, but it’s my question and I ask it. Readers, at this point, we’ve given you some speed-reading type lessons here. A lot of content in a short period of time. For me, the takeaways have been to get your credit score, do a little investigation, find out if there are things on it that are false, and drop your utilization. Merrill has agreed to provide something valuable to you in your journey to get more fundable. It’s called the Get Fundable Checklist. Could you tell us a little bit about that?

There are over 80 main features of a fundable profile. What I’ve done is I’ve collected the main ones. There are 300 steps. Every person doesn’t have to go through every step. I’ve collected all of them in the Get Fundable Checklist. We call it the Ultimate Fundability Checklist. You’re going to say, “That’s true. That’s not true.” It gives you an outline of what needs to be done. Without more intel, I can’t give the exact answers, but at least now you know what to pay attention to and where the landmines are. The GetFundableChecklist.com. Tell us where to send it and it is yours.

That is not just an incredible gift but following a world-class lesson on getting fundable. One comment I want to make before I let you go. It seems to me that if you go through these exercises and you fix the things that we talked about and many of the things which you teach in your courses, your credit score will go up. As a side benefit to getting fundable, you are doing a form of credit repair as well. Would you agree? 

We’re not repairing it. We’re just optimizing it. I would say more credit optimization because credit repair in our culture says, “I got something wrong.” Most of my clients don’t have anything negative on their credit or they don’t have any slow pays. They come to me going, “Why can’t I get money? I have an 802.” I’m like, “Your score is not what we’re supposed to be focusing on. We need to focus on the fundamentals of optimization and fundability.”

Merrill, our time together was enlightening. Readers, I hope your time with us was enlightening too. I want to thank you for all that you shared. I urge readers to go get that free report, GetFundableChecklist.com, and start working through it a little at a time because when you need it, it will come in handy. Thank you, Merrill. I look forward to our next conversation. 

Thank you.

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