|
|
 |
|
 |
|
|
| |
Posted: 2005-07-19 / Author: Simon Harris
Building Business CreditLet's imagine that you wanted to start a business-you have a
great business idea, and now all that you need is business
credit so that you'll be able to borrow money against your
business without having to dive into your personal assets or
personal credit. This means less risk for you, the owner. Some
credit reporting agencies sell a business FICO score based on
both the risk of the business and the personal credit of the
owner. In some instances, the owner's personal credit is linked
to the business credit, but it's best to keep them separate if
you can. Building business credit is completely different from
building personal credit. In addition, you don't have the same
credit protection laws with business credit that you do with
personal credit.
There are certain keys that you can follow to help ensure your
business credit gets off to a great start. Follow along as we
discuss them below.
First, set up the proper business structure and take basic
steps to ensure your business appears stable to the business
credit bureaus. That means getting the proper occupational
licenses, corporate structure established and a business credit
profile. A business credit profile helps you to build business
credit without using your personal credit. Benefits in having a
business credit profile are numerous. For one, you will have
more cash for the business, convenience in purchasing,
protection of your personal assets, limiting of personal
liability from the business, and the ability to prepare your
business for future lending needs.
Secondly, you need to borrow or buy products and services from
companies that will report your credit history to the major
business credit reporting agencies such as Dunn and Bradstreet
and Experian. Unlike personal credit ratings or FICO scores;
income or better yet income potential, plays a huge roll in
business credit scores. The top FICO scores are reserved for
the large stable businesses. But don't be discouraged, with a
little time, you business FICO will skyrocket!
Next, in order to enter the business credit market, you'll need
to do a credit assessment to determine if you comply with the
lender and credit bureau's requirements. Then look for
businesses that issue credit without the need for established
business or personal credit checks or guarantees. Once you have
transacted business with vendors on credit, you can use those
references to build your credit profiles with the credit
reporting agencies.
In many states, there are non-profit organizations and/or
government organizations that will help you with setting up
business credit. Often there are loans available for start-up
businesses or even government grants. Check your state
government web sites for such organizations. Many retired
owners and businessmen volunteer to help start-up businesses.
By researching your options prior to a business start-up; you
will not be struggling later with questions. With any luck
building your business credit will be a smooth transaction with
a huge net profit for you in the end!
---------------------------------------------------------------
About The Author: This article providec ourtesy of
http://www.debt-consolidator-guide.net/
Top of page | |
 |
|
 |
