How to Get a Business Credit Card with Bad Personal Credit
Trying to find out how to get a business credit card with bad personal credit? We researched a bunch of company credit cards for you. So, here are our top picks.
Per the SBA, small business credit card limits are a whopping 10 — 100 times that of consumer credit cards!
This shows you can get a lot more cash with business credit. And it also shows you can have personal credit cards at stores. So, you would now have an extra card at the same shops for your business.
And you will not need collateral, cash flow, or financials to get business credit. But you do need to be Fundable. And this is even truer as we seem to be sliding right into a recession.
Company Credit Card Benefits
Benefits can differ. So, make certain to pick the benefit you would prefer from this selection of alternatives. Some of our choices call for better to exceptional credit. So, take this time, as we pause and reflect, to improve your credit.
Be Fundable™ to Get a Business Credit Card with Bad Personal Credit
The best way to get a business credit card with bad personal credit is to build Fundability. But what does it mean to be Fundable?
Fundable: of or capable of being funded; deserving of being funded. Fundable also suggests – able to be funded by a lending institution or a credit issuer.
Lenders and credit providers want to see if your corporation is a good credit risk. Firms which are fronting your business cash, they wish to know that you can pay them back. They want to be sure you’re not committing fraud. It all starts with your industry when it comes to getting business credit with bad personal credit.
Industry Aligned on All Records
Some industries are believed to be high risk or restricted. These industries, by definition, are going to have a more difficult time getting financing of any kind.
But there’s the idea of congruency, and it turns up repeatedly. Business credit reporting bureaus and lenders will analyze your corporation carefully. Among the major ways they do this is by strictly looking for matching records.
Because of this, if your records do not all match, it will show up as if they are missing. Missing records will trigger a rejection, as a loan provider will assume fraud on its face.
Therefore, it is crucial to make sure that every record, anywhere, is identical.
Copy/paste this info; do not chance it with retyping.
Including a risky business type in your corporate name will cause funding rejections. Listed corporate ownership must be the same any place you list it. It is best practices to keep a record of every place where your corporation has a listing.
Website and Email
A business needs a professional-looking site. And it must have site hosting from a provider like GoDaddy. Do not use Weebly or Wix. It needs to be your domain, not domain.wix.com. Use Upwork to employ people who can help you get set up. Get a professional logo from Fiverr. Email must be on your domain.
Business Address and Phone Number
A business address must be a real brick and mortar building. Hence it must be a deliverable physical address. For a retail establishment, this can never be a PO Box. Do not use UPS mailing addresses.
Your corporation must have its own phone number. Do not give a personal cell or residential phone as a business telephone number. But VOIP (voice over internet protocol) is fine.
Also, your corporate telephone number must be toll-free. This is 800 exchange or such.
You must list your company phone number on 411. You can do so on www.listyourself.net. Your phone number has to have a 411 listing for most credit issuers, lenders, vendors, and even insurance companies to approve you. Check your record to see if you’re listed. Make sure your information is accurate.
Time in Business
Incorporation date, the business license issue date, and the date you opened your business bank account all matter.
Business Bank Account
You need a business bank account, to keep funds separate from personal accounts. Keep a good, positive balance and avoid NSFs.
This defines issues of liability, and it makes a difference when it comes to taxes. The best business entity for Fundability is a corporation.
A sole proprietorship means the business owner is it when it pertains to liability and tax obligations. Nobody else is responsible. Incorporating fixes this.
Any complete company name must include any recorded DBA filing you use. This necessary for document congruency.
But no matter what, if you run a small business as a sole proprietor, the best thing to do is to incorporate. If you have already filed a DBA, you will still need to move onto a corporate business entity. You ought to only look at a DBA as an interim step on the way to incorporation.
Check with your Secretary of State to guarantee they have all the needed details for your business. Make certain that you are in good standing with them, and that your entity is active. You must submit annual reports and pay a fee each year to stay active.
Go to the IRS website and get a free EIN for your business. This is also where you choose a business entity like corporation, LLC, etc. To open a business bank account, and file business taxes, you need an EIN, so get this out of the way first.
A corporation must have all of the licenses necessary for running. These licenses all must be in the perfect, accurate name of the business. And they must have the same corporate address and telephone numbers.
This means not only state licenses, but potentially also city licenses. Check with your Secretary of State’s office.
Business Credit Bureaus
The biggest and best-known business credit reporting agencies (also called CRAs or bureaus) are D&B, Experian, and Equifax.
Business Data Agencies
These companies collect data and offer it to the business CRAs.
CreditSafe provides alternative credit, where they base some of their scoring on utility and rent payments. These payments are typically not considered by other CRAs unless they’re late. CreditSafe reports these payments whether positive or negative. Third-party payments like Credit Suite, CRM, and software can be included.
LexisNexis is where a number of lenders get their info from. They furnish info on likelihood to pay, or not. If the application and LexisNexis do not match, then loan providers will deny you funding. They will see the disparity as fraud.
The SBFE collects data on small businesses from its members, which are lending institutions. Lenders use this information to make credit decisions.
FICO uses its SBSS (Small Business Scoring Service) Score to combine consumer bureau, monetary, application, and business bureau information.
Business credit providers and the SBA use the FICO SBSS score as a tool to decide whether they should authorize a loan to your business.
CRAs use identification numbers to designate your business.
Experian’s BizSource assigns a BIN (Business Identification Number).
Begin at the D&B website and get a free D-U-N-S number. If there is no D-U-N-S number, then there is no record and no PAYDEX score. Your D-U-N-S plus three payment experiences gets you a PAYDEX score.
Business Credit History
Your company credit history is the single most important driver of your business credit scores. In turn, this influences Fundability profoundly.
Late repayments will impact your business credit score for years. If you pay your business financial obligations off, as swiftly as possible and as completely as possible, you can make a very real difference in your credit scores.
If the business owner has poor personal credit, lenders will typically secure a UCC blanket lien if they give your company a loan.
This is a note on your credit report. It says the financial institution has an interest in all your corporation’s assets till you pay off the loan in full. Therefore, there may be dire consequences if you default.
UCC filings are a matter of public record. Lenders and credit providers take them into consideration when determining if your business is Fundable.
Judgments, Liens, and Bankruptcies
These are all a matter of public record, and they can all negatively impact Fundability.
Together with UCC blanket liens are any other liens against your corporate assets. A lien is a credit provider’s right to retain possession of property belonging to until the debt owned by that person or business is discharged.
A lien isn’t quite the same thing as collateral – it’s the property which is subject to the lien is the collateral.
Total number of trade accounts and highest credit limit
These come from credit issuers which give you starter credit when you have none. Terms are usually Net 30, versus revolving.
The more trade accounts, the better. But in general, a few high credit limit accounts do more to enhance business Fundability than a large number of very low credit limit accounts.
By getting trade credit ASAP, your trade accounts are as aged as they can be.
Opening and responsibly using business credit accounts can help you increase your available credit and boost your credit rating. The key is to use your credit.
Closing accounts has a direct impact on overall credit history. If a card is closed and is in good standing, it will fall off a credit report at some point. And once it’s gone, the history which accompanied it is gone, too.
By closing accounts, you are tanking the average age of your accounts. It’s a part of Fundability over which you have control—simply use your credit and pay it back quickly. In this way, your providers will not feel the need to close accounts for non-use.
Financial statements include business tax returns. It’s best if these are prepared by an accountant or an accounting company, or at least audited by them.
Tax returns should be complete and up to date. Reported income and expenses should be commensurate with those anticipated from a corporation of your size, age, and industry.
In particular for newer businesses, credit issuers and lenders will want to see personal financials. This includes taxes and reported income and expenses. Banks will even look at child support and criminal records.
In addition to reporting on business credit, Experian and Equifax also report on personal credit. TransUnion only reports on personal credit.
There are companies which collect data and provide it to the personal credit reporting agencies. Some banks and other credit issuers use ChexSystems to get more information on your personal credit habits. They also report on insufficient funds, closed accounts, and overdrafts.
Lenders use LexisNexis information to cross-check loan applications. Your FICO score comes from your payment history, amounts of owed, length of credit history, credit mix, and new credit.
Personal Credit History
Much like your business credit history matters for calculating Fundability, so does personal credit history. Data points like accounts over limit, authorized users, and short sales loom large.
Lenders are looking at settled debt, foreclosures and late payments. They are checking opened accounts and history length. They want to see if there are any bankruptcies in your past.
More than two recent inquiries will be seen as proof of credit shopping. Credit Utilization Rate also matters. Credit Utilization Rate is credit in use, divided by total available credit. Keep this ratio at about 30% or less. Experian checks utilization rate both overall and per credit card.
Even the process of applying can have an impact on your Fundability. This includes time, negotiations, and whether your application is being made in person. Choosing a lender familiar with your industry makes a positive difference.
Fundability, on Balance
Keep all records consistent to ensure Fundability. Set up your business legitimately, with a domain, phone numbers, an address, and more. Get all ID numbers and register with the IRS. Set up your business bank account for Fundability. Keep all business financials organized and have them prepared by a competent professional. Get your personal credit ‘house’ in order.
Being Fundable means your business can get financing from a credit provider or lender.
How to Get a Business Credit Card with Bad Personal Credit
Capital One® Spark® Classic for Business
Take a look at the Capital One® Spark® Classic for Business. It has no yearly fee. There is no introductory APR offer. The regular APR is a variable 24.49%. You can get unlimited 1% cash back on every purchase for your business, without any minimum to redeem.
While this card is within reach if you have average credit scores, beware of the APR. However if you can pay promptly, and in full, then it’s a bargain.
How to Get a Business Credit Card with Bad Personal Credit, Not Calling for a Personal Guarantee
Brex Card for Startups
Look into the Brex Card for Startups. It has no yearly fee.
You will not need to provide your Social Security number to apply. And you will not need to provide a personal guarantee. They will take your EIN.
Nonetheless, they do not accept every industry.
Also, there are some industries they will not work with, and others where they want more paperwork. Now for a list, go here: https://www.brex.com/legal/prohibited-restricted-activities/.
To determine creditworthiness, Brex checks a company’s cash balance, spending patterns, and investors.
You can get 7x points on rideshare. So get 4x on Brex Travel. Likewise, get triple points on restaurants. And get double points on recurring software payments. Get 1x points on everything else.
Plus you can have bad credit (even a 300 FICO) to qualify.
And find it here: https://brex.com/lp/startups-higher-limits/
How to Get a Business Credit Card with a 0% Introductory APR
Blue Business® Plus Credit Card from American Express
Check out the Blue Business® Plus Credit Card from American Express. It has no yearly fee. There is a 0% introductory APR for the initial 12 months. After that, the APR is a variable 14.74 – 20.74%.
Get double Membership Rewards® points on day to day company purchases like office supplies or client suppers for the initial $50,000 spent each year. Get 1 point per dollar afterwards.
But you will need good to outstanding credit scores to qualify.
Afterwards, find it here: https://creditcard.americanexpress.com/d/bluebusinessplus-credit-card/
How to Get a Business Credit Card with Bad Personal Credit for Cash Back
Capital One ® Spark® Cash for Business
Take a look at the Capital One® Spark® Cash for Business. It has an introductory $0 annual fee for the first year. Afterwards, this card costs $95 annually. There is no introductory APR deal. The regular APR is a variable 18.49%.
You can get a $500 one-time cash bonus after spending $4,000 in the first 3 months from account opening. Get unlimited 2% cash back. Redeem any time with no minimums.
But you will need good to superb credit scores to qualify.
After that, find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash/
How to Get a Business Credit Card with Bad Personal Credit for Rewards
Capital One® Spark® Cash Select for Business
Have a look at the Capital One® Spark® Cash Select for Business. It has no yearly fee. You can get 1.5% cash back on every purchase. There is no limit on the cash back you can earn. And get a one-time $200 cash bonus once you spend $3,000 on purchases in the first three months. Rewards never expire.
Pay a 0% introductory APR for 9 months. Then pay 14.49% – 22.49% variable APR afterwards.
You will need great to excellent credit to qualify.
But you can find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash-select/
How to Get a Business Credit Card with Bad Personal Credit for Travel Points
Ink Business Preferred℠ Credit Card
For a fantastic sign-up offer and bonus categories, check out the Ink Business Preferred℠ Credit Card.
Pay an annual fee of $95. Regular APR is 17.49 – 22.49%, variable. There is no introductory APR offer.
Get 100,000 bonus points after spending $15,000 in the initial 3 months after account opening. This works out to $1,250 toward travel rewards if you redeem through Chase Ultimate Rewards.
Get 3 points per dollar of the initial $150,000 you spend with this card. So this is for purchases on travel, shipping, internet, cable, and phone services. Plus it includes advertising purchases made with social media sites and search engines each account anniversary year.
You can get 25% more in travel redemption when you redeem for travel with Chase Ultimate Rewards. But you will need a good to superb FICO score to qualify.
But you can find it here: https://creditcards.chase.com/business-credit-cards/ink/business-preferred
How to Get a Business Credit Card with Bad Personal Credit for You
The way how to get a business credit card with bad personal credit will hinge on your credit history and scores.
Only you can pick which features you want and need. So, be sure to do your homework. What is outstanding for you could be catastrophic for other people.
And, as always, make certain to build credit in the recommended order for the best, speediest benefits. The COVID-19 situation will not last forever.