Business Credit
Business Credit questions and answers
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Q: Business credit?
Will establishing a business line of credit help our personal credit rating? My wife owns a small business and we have received many offers for credit so she's curious.
A: The business line of credit may very well take your personal credit history into consideration and require you to personally guarantee the debt, but business credit won't show up on your personal credit report.
Q: Is it possible to build business credit with a small home-based business?
I have a small e-business, and I would like to know if it's possible to build a significantly high level business credit score?
Also, can you build a business using business credit?
A: You can absolutely business business credit with a home-based business. www.thexbanker.com is a good source. I don't understand your second question. Can you clarify?
Q: What's a good first credit card to get to start establishing business credit?
I recently started an LLC and would like to start establishing my business credit. What are some good first credit cards to get that will help me establish my business credit? Most I've seen want my personal credit as a co-signer for my business, but I would prefer to stay away from that. I mean, what was the point of forming an LLC if my personal credit was going to be taken into account for everything, right?
A: Just use the credit card for shopping and pay it in time, and your credit score will grow. Here is some most popular credit card offers to establish credit - cardnow.undonet.com
Q: How can I establish business credit without my personal credit?
With a new start-up business (incorporated), how do you get serious business credit that doesn't tie down your personal credit with personal guarantees?
A: The only way to do this is to borrow in the name of your business (corporation) only - without a personal guarantee (P.G.), then repay the loan.
For this to work you have to make sure the loan is reported to Experian Business Credit. Try also for Dun & Bradstreet, although they are not taken very seriously in banking circles anymore.
The best system is to borrow funds, hold them on deposit, make some monthly interest payments, then give the deposit back to the lender to pay off the loan.
There is a lender that does this with no credit check, if you agree to keep the money on deposit. If you ask, they will also let you open more than one at a time. They also have the ability to report to the credit bureaus under two different names. All of this can help you get multiple positive credit entries. See creditloader dot com for more.
Q: What is the average credit limit on a business credit card? What information will I need to provide?
I have $30,000 and think to get business credit card. What is the average credit limit on a business credit card? What information will I need to provide?
A: First of all you can lend me like $800.00 and you'll be okay. But your credit limit depends on you credit. If you use American Express that darn Charge card, then you are going to get something like No credit limit which looks bad on your credit score. So You might wonna go with so mething that is around $20,000. If any thing goes wrong and you are suddenly out of work or you have to shut your business then you that that thirty that you are saving and stick it on the credit card balance. Remember you won't go over tweny. You will need to provide work history, SSN, and amount you have in savings. If you have a checking account then that will also be helpful.
Q: How can I get a business credit card despite bad credit rating in Canada?
Help! I'm trying to start up a business and all I need is a $10k business credit card. But I have a bad credit rating and so far lenders insist I must have a strong co-signer. But I can't get anyone to do this for me (long story) Any suggestions?
In answer to the first responder, it's a self-employed business. I'm the only employee. It's a long story but my personal financial mess is a combination of the high tech collapse (I'm an engineer) that has gone on 6 years, 3.5 years unemployed for myself. Plus, I have a medical condition. I finally made a bold move to get around the medical condition so I can start my own business, now all that is stopping me is a co-signer. I agree, it's not an enviable position but I have no other choice. Is there any way to get a credit card without a co-signer when you have a bad credit rating?
A: Actually, it's a short story. No one else wants to stick their neck out (co-signing) to cover your debts after you have shown little ability to handle your own affairs. They will be 100% financially responsible if you default on your debts and they know it. Operating a business is like operating your own financial affairs on steriods.
Who in their right mind would start a business on credit card with up to 32% anual interest? That is a very large nut to crack on top of paying for employees,your wages, materials, rent,phone and lights.... then look for making a profit too???
Tell me what kind of business you are going into that has a 32% profit after all expenses and I will start one in a heartbeat (as long as it is legal to do so)
Maybe you had better sit down and work out a business financial plan... then work towards fulfilling it and obtaining the capital you need by working and saving the start-up funds... then someone might be willing to listen to your business idea. If you don't believe in yourself then others will not believe any differently. There is no shortcut to success. Those who cut corners are the first to fail.
Response to additional details:
The most probable way you will get a card is with that much money in their account. Your credit limit will match the amount of money in the savings account held by the credit card company. That way you can start building up a history of purchases and paying the bill on time. You have to re-establish a history of being reliable. After a couple of years of a spotless record, you may find someone who is willing to issue you limited credit and further build from that. I know you are looking for a fast way to do this.... sorry probably not going to happen.
I am not trying to beat up on you... I am trying to show you how others (creditors and co-signers) will look at this. Even if you have lost your job,any work is better than none... even fliping burgers. 10 G's is not an undoable amount but it might take you 1 year to get there working minimum wage. Hopefull you will do the numbers and see that if you are holding 10Grand worth of debt on a credit card, your whole business profit will go to support the debt and you are working for nothing.
If you were an engineer then you are used to solving problems with a systems approach and a thorough evaluation. It doesn't sound like you are using your formal education on this new problem. Please write up a plan and look at all the issues systematically. Form a feasable plan and go after your dreams.
Hope that helps
Q: How do I build credit for my small business?
I just opened a car audio business in tx and i have poor personal credit. How do i build my business credit/get a credit report on business ect... also my business is a dba type. Also I can't seem to get credit approval from anyone because of my personal credit any advice will be helpful.
A: As a small business, your business' credit is pretty much tied directly to your personal credit.
You could try to incorporate, i.e. form a corporation. This has certain costs and benefits, but DOES essentially create a new "person" in the eyes of the law with a mostly clean slate as far as credit goes. This is an expensive and complicated option, and probably a bad idea for you, but it IS an option.
Your best bet:
Go to the bank you normally do business with, i.e. the one where you have your checking account, and ask for a SMALL personal line of credit for the business.
This would be in the order of a couple of thousand dollars, but you would have to take care of this as if your business' life depends on it.
The best thing you can do otherwise is to grow the business and become profitable for another year or two. Keep your expenses as low as possible, remember to pay your taxes honestly and on time, and you will over the course of a year or two be able to borrow more.
Learn how to write a solid "business plan" before you go asking for a line of credit with your bank. This lets the bank know that you have a solid grasp on the business, and will maximize your chances.
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WHAT FOLLOWS IS SOME GOOD GENERAL ADVICE THAT EVERY SMALL BUSINESSPERSON NEEDS:
I have done some bookkeeping for a number of small businesses, and will tell you that there are TWO sets of skills you have to master.
The first set is knowing how to do your job well, whatever that is.
The second skill set is that of knowing how to run a business, and that includes what to use credit for, how much to get, and even when to throw in the towel.
A LOT of small businesses go under because the owners are experts in the first area, but horrible in the second.
I strongly recommend that anybody who wants to run their own business take at least two, and possiblly three accounting/business courses. This allows you to look at your business in a way that lets you plan for things like getting credit and how you spend/earn your money.
Another thing that helps is to get a book on writing a business plan. Any good bookstore with a business section will have one of these, as well as a LOT of free sources on the web, if you search. Be careful of websites that offer to sell you "courses" in business management. The information you need is widely available and free.
Lastly,
Get in touch with the Small Business Administration. They can help you with a whole range of things, and provide you with some very solid FREE advice, including training courses that will help you manage your business.
Regards,
RG
Q: What is the best business credit card to apply for?
My husband runs his own subcontracting business and he is needing to apply for a business credit card. I researched some and so far Discover's business card seems good. Any other ideas?
A: Well, if he's not planning on carrying a balance and just funneling his spending through a credit card and paying off the balance each month, then you'll want to get the business rewards card that pays the most (e.g. cash back reward) for what his business buys.
You can use this rewards calculator to see which business rewards card will pay him the most in rewards for his business's normal spending profile:
http://www.creditcardtuneup.com/?card_type=Business
Q: What are my options for acquiring a business credit card?
I am a recent college graduate looking to start a tax preparation business. I have average credit with one major charge off on my credit report. What are my options for applying for a business credit card to finance office material and supplies? Im not looking for a huge credit limit, just need about 5k.
I know its ONLY 5k and your probably thinking I should borrow it from my parents or ask a "rich family member" I dont have those kind of resources so please refrain from those kind of answers. Serious answers only. Thanks in advance!
A: Hi LRJ,
If your going to try pitching to banks...i would suggest pitching to local banks in your community. They are more flexible with their terms and loan regulations because a lot of them are self underwritten loans. Remember to polish up your business plan and dress the part as well and of course the bank always want to know what is in it for them.
Another alternative is to start an LLC or Incorporate yourself as a business...then apply to supply companies using your LLC or Inc name. They will start you off with some credit line to get your supplies. Also apply to department stores that carry office supplies and in between all of them you should come close to your goal. At first it is hard to start your business credit line but it can be done.
I also have another source that a credit repair system recommends and they have a 5,000 and 10,000 credit card through their own retail company but there is some costs associated with these but they do rebuild your credit as well. Not trying to sell you anything, just resources that i have.
I hope this helps with your situation and wish you a great success and a Happy New Year!
Q: How does one establish business credit for a S corporation?
I help started a newly established S corporation and wrote a business plan for the company. Next, how do I establish business credit for the company? Thank you in advance.
A: If you had a detailed business plan you'd have the answer. That would be a major part of any business plan. The Pres. VP, Sec. or Treasurer will have to "guarantee" the credit issued to the company. This has nothing to do with either an "S" or a "C" corp. Both need credit in one fashion or another. Good luck on your new corp.
Q: What is the difference between personal credit cards and business credit cards?
I have a few personal credit cards and I want to consolidate them. I am also self-employed, but I dont' have a business credit card; although I get LOTS of ads for them in the mail. I've always wondered, what is the difference? Are there different rules or fees? Can you only use them for business purchases? Do you have to spend a certain amount to keep them?
Any advice appreciated...
A: Business credit cards allow to control business expenses and separate them from individual expenses. Consider some thing before you choose one:
1. Be sure to comparison shop the bank cards offered by Visa and MasterCard, American Express and Discover. Check interest rates, fees and grace periods for payment. Some bank cards partner with hotel chains and restaurants to offer you additional discounts.
2. Analise how you will use the card. If you travel often to meet clients, find a card that provides the most travel benefits and frequent flier miles - those cost-savings can really add up at the end of the year.Compare card programs offered directly by the airlines. Some let you redeem miles on any company while others have restrictions on which airline you can use it. (for example CitiBusiness Premier Pass let you choose any airline that is convenient to your business needs)
3. If you don't travel much but still need to entertain clients, you'll want a card that offers discounts to restaurants or gift merchandise as opposed to a card that mostly gives discounts on standard business supplies or computer equipment.
4. Check with companies like FedEx Kinkos, Staples to see which credit card companies they deal with.
Pay the card off in full each month to obtain the most benefit out of it. Interest charges can quickly add up and wipe out any cash back savings you might gain.
I hope it will help you...
Q: Where can I apply for business credit without using my personal info?
I own a construction company and I am trying to establish credit for my business as well as find a legit credit repair company to repair my personal credit, my company pay taxes, we have the tax ID #, and we are incorporated. I have used my personal credit for my business as it has caused my scores to go down. Appreciated if anyone could help!
A: US banks and other lending institutions are required by federal law to identify all owners of a business account. Lenders are in the business of LENDING money with an expectation that it will be repaid, so they want to know who is handling the affairs of a business.
A site I've used for info in the past ...
http://www.safelinked.info/jump.php?link=debt
Hope that helps.
Q: What is the best way for me to build some business credit?
I just got my tax id number from the irs, and I also have a state sales tax number. Im trying to become a reseller of computer parts that i plan to purchase from a wholesale company. My personal credit history is one of the worst in america. How can i get approved for anything to start building credit for my business? Whats the cheapest way, and fastest? I tried years ago to apply for an office depot card with a previous business, but they declined me cause my business had no credit. If i cant get an offie depot card, then what can i do? By the way I have a sole proprietor business.
A: Incorporate. As silly as it seems, an incorporated business that has no connection to an individual tends to have greater credibility than someone who is directly connected to his company (e.g. a sole proprietor)
Once you are incorporated, getting business credit is fairly easy. Just show that you have been in business for about 6 to 8 months.. a year is even better. And then give them a ball park estimate as to what you do in gross reciepts every year and you should have no problem with getting business credit.
Q: What fastest way to build business credit?
Does anybody have and tip or tricks on building business credit quickly. Im looking to get a Paydex of at least 80 in a couple of months.
A: INCOME.....(have a steady flow coming in)
Also try sure to be in limited to no debt.
BUt I think the main thing any lending institution/device looks at is what are you "bringing in".
Obviously REAL capital like real estate or other real goods/merchandise is often taken into consideration.
www.pennstate.20fr.com
Q: How can you build up business credit with a new Business?
I'm just starting a transportation company and trying to figure out how to build business credit outside my personal credit ?
A: you could start by getting a business credit card check out www.fastcreditcardapprovals.com here you will be able to compare all major credit cards side by side on rates, fees and rewards.