Establish Business Credit

As a non-profit organization there are many opportunities for you to get business credit? For example, Wal-Mart offers a Community Business Credit Account specifically designed for non-profit organizations such as charities, hospitals, schools or religious organizations.

When you apply for the account you will need to provide the legal name of your organization, your tax exempt 501 (c)(3) number and DUNs number.

You will also need to determine how many authorized buyer cards you want with the maximum set at 99. I also suggest that you consider selecting the purchase order option.

Now on this new business credit account you are required to furnish your social security number but I would suggest leaving it blank if you have a strong Dun & Bradstreet file with an 80 paydex score and at least five or more trade accounts with decent credit limits.

You can complete the new business credit application online but you will need to print it out and fax it upon completion.

Now keep in mind you can build business credit with this account and receive larger extensions of business credit but each month you will have to pay the balance in full because it’s a net 30 account.

The Wal-Mart Community Account Application is specifically designed for non-profits so if you’re company is a for-profit business then you will need to check out Wal-Mart’s Business Credit Account.

As a non-profit I encourage you to establish business credit with companies like Wal-Mart that are willing to provide business credit cards or corporate accounts that cater to non-profit community organizations.

To your Business Credit Success!

Business Credit Resources

» Business Credit Seminar

» Business Credit Builder

» Business Credit Blog

To access business credit insider secrets, premium vendors, leasing companies, business credit cards, and lenders that report to all the major business credit bureaus become a member of my Business Credit Insider’s Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insider’s Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.  

Business Line of Credit

 
Not too long ago I did a podcast covering how to obtain a business line of credit. From that interview I have assembled answers to some of the most common questions that I get from my members that will help you in establishing business credit for your company.

Why is this one of the most popular forms of business loans?

Well, there are a couple of reasons why a business line of credit is so popular. First of all, it allows your business to obtain a large sum of cash, what I call cash on demand and it allows it to make purchases that are either too large for business credit cards or too small to take out a business loan.

The second reason why it’s so popular is because of the easy access to cash. Typically, a business line of credit works like a revolving credit card but the major difference is that they have much lower interest rates and higher available credit limits than a revolving credit card.

The third reason why it’s so popular is the payment flexibility because some banks even offer special features that require monthly interest only payments to be made by the business and this allows the business owner to have small payments if they tap into their corporate credit line.

Can I qualify if I have not been in business for a long time?

Yes, but banks typically prefer that a business has at least a two-year track record of being established. If you’re a startup company the bank will require a personal guarantee and may require that you put up some personal collateral to secure the line of credit as well. Keep in mind that your approval is going to be based on your business’ past revenues, cash flow, bank rating, business credit report and your personal credit scores.

Business Credit Blog » Business Credit » Business Line of Credit – questions and answers for securing a business line of credit

Small Business Line of Credit

 
How do I qualify if I had bad personal credit?

As a temporary solution you can transfer 100% of the business to your partner with the strong personal credit profile. The transfer of ownership is done privately and can be easily filed in your corporate record keeping book. Make sure you consult with your CPA and attorney if this is something that you’d like to do but remember, the transfer of ownership can be transferred right back after you finish applying for a corporate credit line.

What amount should I apply for?

It’s a lot easier to get approved for a $50k line of credit compared to $100k line of credit simply because of the documentation and amount of financials required on larger credit lines. You see, banks only require a couple of things for $50k or less credit line applications. For example, they require a low five bank rating, a solid business credit report, and personal credit scores of 680 or greater to approve a $50k line of credit.

Now, if you’re applying for a credit line greater than $50k than in most cases, you end up having to also provide two years of personal tax returns, two years of business tax returns, profit and loss statements and financial statements. So you can see the difference in documentation is substantial when it comes to the amount of credit that you’re applying for.

Can I apply for multiple business lines of credit?

Yes, you can and should always diversify your business credit and banking relationships. A tough lesson that many small business owners faced as a result of the recent credit crunch was that they put all of their banking and credit lines in one basket. As soon as their credit line was cut their business was strapped with no other access to credit.

When you establish multiple corporate credit lines, it puts you and your business in a much safer and stronger position so if one of your banks happens to reduce or even cancel your credit line; you still have several other ones readily available to you.

One word of caution about this is don’t open more than three business bank accounts within a 90-day period because your business could possibly get stuck in chex systems which is the ratings systems that banks use when you open up a business bank account.

Whatever your situation is in your business, if you think you don’t need the business credit right now or you don’t need the cash that is the best time to get started.

Business Credit Resources

» Business Credit Seminar

» Business Credit Builder

» Business Credit Blog

To access business credit insider secrets, premium vendors, leasing companies, business credit cards, and lenders that report to all the major business credit bureaus become a member of my Business Credit Insider’s Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

 

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insiders Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.  

Business Credit Lenders

One of my favorite business credit lenders who get it right when it comes to small business and has the track record to prove it is Regions Financial Corporation.

According to Tim Laney, senior executive vice president and head of Region’s Business Services Group, “Small businesses are the engine of our economy and Regions has a long track record of providing capital to small businesses along with solutions to help small business owners manage all of their financial needs.”

Don’t just take it from me in a yearly study measuring banks’ strength on small business lending the SBA ranks it number three among the large U.S. banks for the sixth consecutive year! It also happens to own the number one slot for small business lending in Alabama and Tennessee.

With such an impressive track record it shouldn’t surprise you that Regions Bank is also behind the new business credit cards being offered by CSI Business MasterCard.

One card that got my attention in particular is the CSI MasterCard Corporate Card. This card was responsible for one of the country’s leading candy bar manufacturers to move away from paper check reimbursement to an integrated electronic credit card program.

This not only allowed this major manufacturer to automate its merchant reimbursement program but also eliminated the use of paper which is great for our environment.

Business Credit Blog » Business Credit » New Business Credit Cards – new business credit cards for small business

New Business Credit Cards

CSI Enterprises, Inc recently launched a new business credit card web site offering fleet credit cards, incentive cards, e-payables, and corporate purchasing cards for businesses. Here’s a brief overview:

• Global Business MasterCard – a card designed for purchases made by employees on behalf of your business with control over all aspects of spending. This card is similar to a business charge card because there are no finance charges and the account must be paid in full each billing cycle.
• Global Fleet Master Card – a card designed for fuel purchases and provides you fuel discounts with over 30,000+ retail and truck stop merchants.
• Global Secured Master Card – excellent card to get credit for a new business with prefunded or secured options. Requires a $1,000 minimum deposit to get started and reports to Experian Business.
• Virtual Master Card –this is an electronic payment solution card for vendor settlements.
• CSI Incentive MasterCard – these are simply prepaid reloadable cards that you can use for employees or customers.

These cards can help in establishing business credit for a new or existing business while providing you the tools you need to manage your company’s expenses. Take a close look at each of these cards and decide which one best fits the needs of your business.

When banks like Regions get it right by issuing new business credit cards and business credit loans through all economic cycles, including the recession in order to support the small business engine other business credit lenders should pay close attention.

To Your Business Credit Success!

Business Credit Resources

» Business Credit Help

» Start Building Business Credit

» Business Credit Blog

To access business credit insider secrets, premium vendors, leasing companies, business credit cards, and lenders that report to all the major business credit bureaus become a member of my Business Credit Insider’s Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

 

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insider’s Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.  

Business Start up Credit

On the previous post I mentioned how you can start building business credit right away by having your everyday expenses like web hosting, phone services and printing reported on your profile. If the companies you’re doing business with are not reporting your payment history you can use a business credit builder product at DNB that will get the job done.

You can also start corporate credit accounts with companies like Verizon, Quill, Accurate Office Supply, Best Buy, Fed Ex and many others. You will need to provide your EIN number when you open an account and some companies will request your Dun & Bradstreet number. Remember, not all companies that you start business credit with will report your payment history.

Also, each company has its own credit approval guidelines and minimum requirements for business start up credit. For example, Accurate Office Supply offers a net 30 account with no personal guarantee but requires your business to have a minimum of three trade references and one bank reference.

So if your goal is building a strong business credit file then you will either need to select companies that report to the business credit bureaus or use the dun & bradstreet credit builder product to have your trade references added yourself.

You can also take advantage of companies that provide you a business credit supplier directory like the Business Credit Insiders Circle.

Business Credit Blog » Business Credit » Start Business Credit – start up credit for small business

Start up Business Credit Cards

While trade credit with companies like Quill and Fed Ex can help your business fund its short term needs cash credit is much more preferable. The mistake that most business owners make is applying for a business credit card that requires a personal credit check as well as a personal guarantee.

These types of cards are a glorified version of a personal credit card because the charges and debt your business incurs all report on your personal credit reports. Furthermore if you default on any outstanding debt incurred on the card then you are personally liable for that debt.

So you’re probably wondering how a start up company like yours can obtain a business credit card with no personal credit check or personal guarantee. For starters I suggest a secured business credit card for establishing business credit. After several months of solid payment history you can request an unsecured credit line increase.

In addition you may want to consider a business debit card from the bank that services your business checking account. Even though this doesn’t start corporate credit for your company it does help establish bank credit.

You should always take advantage of these types of products offered at your bank. Some banks like Comerica, Key Bank and Associated Bank have its business credit card issued through Élan Financial Services. Élan’s underwriting guidelines for business credit cards require a personal credit check for approval but your company’s revolving debt and payment experience do not report to your personal credit reports. A big plus for your personal debt to credit limit ratios!

As you can see even start ups can start building business credit with everyday expenses, corporate credit accounts, a secured business credit card, a business debit card and business credit cards.

To your business credit success!

Business Credit Resources

» Business Credit Seminar

» Business Credit Insiders Circle

» Business Credit Blog

 To access business credit insider secrets, premium vendors, leasing companies, business credit cards, and lenders that report to all the major business credit bureaus become a member of my Business Credit Insider’s Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insider’s Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.

Build Business Credit History

Business credit builder companies believing it’s too difficult to build company credit on a shoestring budget are in for a pleasant surprise after reading this post. Every business regardless of how small the amount of money it can spend has mandatory expenses it cannot avoid.

These expenses in my book are opportunities for you to build business credit history. No matter what amount of money you’re spending right now to operate and grow your business you can benefit by having it reported on your company’s corporate credit file.

Here is a sample list of the typical expenses every business incurs that can be used to build business credit history:

• Website development – some companies in the marketplace that develop web sites not only extend credit to start ups but also report your payment experience to the business credit bureaus. If you already have a working web site then make a note of the company that you paid to build it for you.
• Internet services – are you paying a web hosting fee? If so why not have the monthly fee reported to your file? Are there companies that report web hosting fees to the bureaus? You bet!
• Phone services – another expense that is so widely overlooked that your company should get credit for on its report.
• Office supplies – many office supply companies offer vendor credit lines that you can use to purchase supplies your company needs. This is not only a great way to fund your short term needs but also an easy business credit builder.
• Postage/Shipping – instead of going to the post office and using cash to ship products, letters or materials why not use a shipping company that reports your payment history.
• Marketing – if you are using a printing company to create your brochures, business cards and marketing materials why isn’t your payment experiences with them being reported on your corporate credit file?

These are just a few of the items I review with my clients in my business credit practice. One of my members who own a home based business marketing children’s books had over twelve positive payment experiences added to her file after we did this exercise. Within two weeks after her profile was updated we got her approved for a $7,500 credit line with a marketing company which she is now using to expand her advertising reach.

It was much easier for her to get those items listed because she enrolled in the duns credit builder program offered at Dun & Bradstreet. This would be a good option if you already have companies that you work with that do not report to the bureaus. But if you’re just getting started then it makes sense to use companies that report so you don’t have to go through the additional work.

You may want to consider the Business Credit Insiders Circle  because we provide you with the companies that offer these services like web hosting, web development, marketing, office supplies and many more that all report to the business credit bureaus.

As you can see this is simply a business credit building strategy that takes what you are already spending to operate and grow your business and have it reported on your company’s credit file. When you showcase your company’s ability to manage its finances on its corporate credit file you can greatly increase the ability for your business to access the cash, credit and financing it may need in the near future.

To your business credit success!

To access business credit insider secrets, premium vendors, leasing companies, business credit cards, and lenders that report to all the major business credit bureaus become a member of my Business Credit Insider’s Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insider’s Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.  

Building Business Credit

While obtaining business credit cards, small business loans and a business line of credit is the common objective for many small business owners there is a growing demand for learning how to qualify without having to use personal credit or a personal guarantee.

I’m happy to see that more and more business owners are embracing the idea of completely separating your personal credit from business credit. Many of our new members were never aware of the danger that co mingling the use of credit profiles for personal and business can jeopardize the protection of the corporate veil plus limit the amount of funding their business can obtain.

 Here are twenty steps to building corporate credit without using a personal guarantee. Please note that I’ve used examples from my own business credit practice.

1. Incorporate your business and obtain a Federal Tax ID#- your Tax ID number will be the number that identifies your business and information. It’s just like how your social security number will identify who you are for personal credit.
2. Complete corporate conformity (411 listing, verifications, business license, etc.) –vendors, lenders and banks will do their due diligence prior to extending credit to your company. Don’t expect to receive credit by skipping these key fundamental steps.
3. Select the right business classification codes – avoid selecting codes that will trigger a red flag with the business credit bureaus and lenders. This can stop your business credit building efforts dead in its tracks.
4. Set up a complete profile with Dun & Bradstreet – Simply obtaining a DUNs number doesn’t cut it you will need to furnish additional information on your profile to give creditors a complete picture of your business. Remember there are companies like First Equity that offer no personal guarantee business credit cards but by invitation only. They purchase targeted lists from the business credit bureaus which you want your company to be on.
5. Add existing positive trade references – use business credit builder programs which can help you build business credit fast so if you have the references take advantage of it.
6. Apply for vendor lines of credit – getting business credit can be simple with companies that specialize in startup companies or businesses with no credit.
7. Pay invoices ahead of the due date – you can increase your paydex score to 90 or higher by simply paying your invoices 10-20 days ahead of the due date. A big plus on your files!
8. Build solid payment history – while account types and trade lines are a factor keep in mind that a payment track record is the final ingredient. Don’t think that one paid invoice will make your business capable of acquiring no personal guarantee credit lines or credit cards.
9. Monitor your business credit file – a no brainer and a good habit to adopt for your personal files as well.
10. Get listed with multiple business credit bureaus –target specific business credit bureaus that cater to your industry on top of the big three.
11. Set up a small business bank account –before selecting a financial institution for your banking make a list of the financial products you may need. Consider a credit union or community bank because they are much more flexible in today’s economic environment.   
12. Establish a minimum ‘low 5’ bank rating – know what your banks are looking for in business credit lines.
13. Obtain secured business credit cards
14. Open a small business credit line
15. Establish a diversity of credit – build a strong business credit profile by obtaining different account types. This includes trade credit, revolving credit, loans and leases.
16. Keep proper financials
17. Establish a well written business plan – A business plan is your blueprint that outlines every necessary component for the success of your business. Enough said!
18. Maintain personal credit scores at 680+ – when applying for no personal guarantee credit a lender or creditor may still require a personal credit check.
19. Build large trade lines with multiple tiers of credit –you can request for a credit limit increase usually after six months of good payment history. Before applying for larger tiers of credit be sure to know what the requirements for approval are.

20.  Stay informed! – join forums, social networks, read articles, subscribe to blogs and consider joining memberships like the business credit insiders circle.

Following these steps will provide your business opportunities to establish business credit in the name of your business while protecting your personal credit and personal liability.

To access business credit insider secrets, premium vendors, leasing companies, business credit cards, and lenders that report to all the major business credit bureaus become a member of my Business Credit Insider’s Circle. Submit your name and email below for details and receive a free audio seminar ($597 value) =>

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insider’s Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.