Published By Credit Suite at January 11th, 2016
So, are you interested in building business credit history? Here, we offer tips to help you achieve your objectives.
Getting credit for your business with no personal credit check and no personal guarantee is very appealing.
One might say this is the holy grail of owning a business, being able to get a massive amount of funding using the business itself as collateral. So it is vital.
Now, there are many steps to building an exceptional business credit profile. And building business credit history is an important step for any business owner. Each of these steps is essential in obtaining business credit with no personal guarantee.
1. Make sure you start by incorporating your business. Also, make sure to get a Federal Tax ID#. This is also called an EIN.
2. Ensure you set up a business bank account and that the business name on your corporation papers is the same as on your business bank account. This also makes it possible to open a merchant account. And then you can take credit cards.
3. Make sure you have a business phone number that is listed with 411.
4. Ensure you have the proper business licenses for your business that you need in your state. Also, check the town or city, and the county or parish. They might have their own licensing requirements.
5. Set up a complete credit profile with Dun and Bradstreet
6. Pay business bills that report to the business credit reporting agencies ahead of the due date. The earlier they are paid, the higher your business credit scores will be.
7. Build solid payment history with many accounts being paid as-agreed or early each month. Building excellent business scores means you have a lot of accounts reporting as paid-as-agreed. So get your credit, and then keep using your credit. So, this will help to build a solid profile.
8. Monitor your business credit file. Keep an eye on your scores and the accounts that are reporting.
9. Establish a minimum ‘low 5’ bank rating by establishing and using bank credit.
10. Open a small business credit line that reports on your business credit profile. So, credit lines have high limits and reflect positively on your business reports.
11. Establish a diversity of credit using multiple store and Visa, MasterCard, and Amex accounts.
12. Also, establish a well written business plan as many lender will want to see this to approve you for funding.
Working on your business credit is an intentional act. Because unlike with personal credit, you have to work toward it. And so, for the business owner looking to build business credit, they have their work cut out for them. But fortunately, we can help!