If you’re a business owner, should you apply a separate business credit? Is it really important to separate business and personal credit? In this article, let’s discuss the
differences of a business credit from a personal credit.
Business Credit Gives You the Financing Power
Entrepreneurs who are starting a business or who may be expanding the business would need all the financing help they can get. In most cases, obtaining a loan is necessary in order to execute business projects. However, acquiring a business loan also depends on the status of your business credit. Do you have an impressive business credit?
For a new business owner, establishing a separate business credit history is a must. A tool which can help you build up business credit is a small business credit card. Since, you have not yet established a business credit, your chosen business credit card company would check your personal credit history in place of business credit. If you have a high credit score, it would be a lot easier to get approved for a business credit card.
For those who have poor credit history, applying for a secured business credit card is an option. Secured business credit cards do not require good credit. However, the applicant is required to submit a cash amount in his security deposit. The amount of deposit may range from $500 and above, depending on how much credit limit you need. Consequently, the amount of your security deposit determines how high your credit limit would be.
It is also important to register your business entity and to sign up for an official business credit number. Two of the leading credit trackers for business in the industry today are Dun & Bradstreet and Experian. Signing up for a D&B number is free and takes only 30 days to complete. As soon as you have your D&B number, you must acquire a small business credit card that reports payments to the major business credit bureaus.
Building a good business credit would largely depend on how you handle your business credit card accounts, your business loans, and other accounts with suppliers and other companies you deal with.
Rest assured that having a solid business credit history will make a big impact on your company’s progress. As your company grows, getting the financing assistance you need would be a lot less complicated if you have a business credit to back you up.
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Pamela Williams is a Loan Consultant, Internet Marketer and Writer. For years she had helped consumers and business owners especially regarding business credit cards. This resource is dedicated particularly on business credit card reviews, articles, tips and advice, and online application so that consumers and business owners may compare which is the best business credit card for their business. Copyright 2010 |
