Many Successful entrepreneurs, by their very nature, are risk takers who are dreaming of a better future… and while the nine-to-fivers may do a good job of bringing home a steady, if small, paycheck, The Entrepreneurial spirit demands that one that sees the promise in the American dream, in a future of changing the world for the better by following through on an exciting idea or venture... These same valuable traits can cause ones personal credit and FICO score to be lower then average, since risk/reward is part of the true entrepreneurs’ daily life.
So, the questions are:
How do I overcome the obstacle of bad or nonexistent personal credit?
Your personal credit will usually be pulled when you are doing business as a sole proprietorship.
Most companies would like to do business with established companies.
A shelf corporation is a corporation that was already formed and waiting for a business to "use" it....
Since most new businesses fail, a shelf corp. has the ability to make your business already have "beat the odds" of the 80% (or whatever percent) of business that fail... making banks much more likely to give you higher limits then if your business was brand new and “starting OUT”.
Other then buying s shelf corporation, how do I build credit for my business?
However… even without buying a shelf corporation… Many entrepreneurs have learned the ticks and secrets employed by larger businesses, in which the business stands, quite literally, “on its own”, and can get credit from vendors and even some bank credit lines such as VISA cards, without a personal credit check, or even providing a social security number!
Some Tricks:
Having a Business Phone Line
whether of not your business is home based or operating on a shoestring, many businesses and Entrepreneurs make the mistake of what they think is “saving Money” by using a Residential rate (non business) phone line.
Many businesses, such as Staples office Supply, will check a 411 listing (which is free with a Business phone line) as the basic gauge of whether or not the entity applying with them for credit, is, in fact, a legitimate business.
A more expensive, business phone line is therefore a major plus in having your business stand on its own when applying for credit with vendors.
How to name your business
If you would like to obtain credit for your business, having a business name that reflects a respectable company will help you. You should Not use the word “Realty” “properties” or any other word that narrows down your business to a real estate related one, even if your business does consist of real estate. “Acme Equities” or, even better, “Acme Inc.” will help you gat larger and more tradelines then will any business having a real estate related word in the name.
This is because Many vendors and Lenders are wary of real estate related businesses, especially since mortgages and lines of credit on properties are much easier for people in the real estate business to obtain, making a company wary of giving unsecured loans of any sort to a real estate entity.
There are hundreds of tips and strategies that you can use to build credit for your business, many of them little known ways to save hundreds of dollars in building your business to the point of being able to obtain credit on its own as a business.
Who offers business Credit?
A free resource with basic information on some 40 vendors offering business credit is available free of charge at www.business-credit-secrets.com/sourcebook.pdf
The password to open the file is: monetized
Ted Aberle is the author of Business Credit Secrets; How to obtain credit for your small or homes based business without putting your personal credit on the line. What the Big Business Owners know and do to keep a potential business loss from screwing up their personal credit history.
The Web site is located at www.monetizedintellect.com
Source: http://www.ArticlePros.com/author.php?Ted Aberle
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