BUSINESS CREDIT FOR STARTUPS

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BUSINESS CREDIT FOR STARTUPS

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Business Credit This is credit in a business’s name and not the owners’ Personal credit does not matter The company’s ability to pay is what the credit provider cares about It opens up a multitude of opportunities

Business Credit Benefits Use business credit to fund your business You need business credit to go for loans You can get high limit accounts quickly This is one of the fastest ways to get money beyond immediate funding Note: Anyone can pull your business credit reports

Business Credit Benefits You don’t need a personal guarantee Business credit doesn’t put an inquiry on your personal credit Therefore getting business credit won’t adversely affect your personal credit scores Building good business credit can help you get loans later But first

Your Startup Must be Legitimate to the Lender From the lender’s perspective, they don’t know your business It might be a hobby for all they know They don’t know how serious you are about it They don’t know if you’ll walk at the first sign of trouble

Building Business Legitimacy in your Startup A lender wants to see what they feel is a legitimate business A startup has no to very little history, and that makes lenders nervous It would seem to not be legitimate on its face But there are ways to demonstrate legitimacy

Building Business Legitimacy: Your Phone Number Start with your phone number An 800 toll-free (or other standard toll-free area codes, like 877) number spells legitimacy to a lender You can do this with a virtual phone number A personal phone number may get you flagged as an unestablished entity You can have this virtual number forwarded to your cell phone if away from your computer

Building Business Legitimacy: Your 411 Listing A 411 listing also spells legitimacy Your phone number must have a listing with 411 for most credit issuers and lenders to approve you If your business does not have a listing, ListYourself.net can help you get your business a listing

Building Business Legitimacy: Your Professional Website A professional business website will also help A lender will get a lot of information on your startup from online It’s better if they get it from your website than elsewhere A professional website should provide basic business information at a minimum

Building Business Legitimacy: Your Business Email Address When you buy hosting, get at least a few business email addresses The addresses will then match your domain Never use a freebie provider like Yahoo or Hotmail! Check your email address: [email protected] or [email protected] or [email protected] are all great Or use your name or a combination like a first initial and your surname, like [email protected] Don’t use something like [email protected]

Building Business Legitimacy: Your Business Entity and EIN Get an EIN (Tax ID number) from the IRS Decide on a business entity, LLC, C-Corp or S- Corp are the best for success in building business credit Having an EIN means you can start establishing business credit instead of leaning on personal credit

Get a D-U-N-S Number from Dun & Bradstreet A D-U-N-S Number is D&B’s identifier for your company That way, they can tell Joe’s Diner in Seattle from Joe’s Diner in Tallahassee You can’t start building business credit without it D-U-N-S Numbers are free

A Good Consumer Credit Score Goes a Long Way You will probably tap into your consumer credit at the start Pay your bills on time, and as fully as possible, every time Keep bankruptcies and other negatives off your report Good consumer credit will open up more business credit opportunities

Develop Trade Credit Tradelines (trade credit) are when you get a 30 day (usually) time frame to pay for goods and services you use regularly, like coffee or toner supplies You need tradelines which report to the credit reporting agencies But even a tradeline which does not report might be helpful for a trade reference

Manage Business Credit Responsibly Your business credit scores are mainly based on your payment history Late and incomplete payments will directly and adversely affect your business credit scores Don’t bite off more borrowing than you can chew Building a history of responsible payments will go a long way

Business Credit for Startups If a startup can show legitimacy it helps the lender feel comfortable about lending Building business credit is a specific process Your startup is your dream! It might begin on your kitchen table and turn into a multinational corporation We can help

CONTACT US TODAY TO LEARN MORE ABOUT Business Credit for Startups

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