Aged Corporation Secrets

Many businesses are looking to get a loan. They soon realize they did not take the appropriate steps in order to attain that loan. For them, it is back to the drawing board or worse yet, folding. If you do not want to be one of those businesses, then you need to make sure you have all things lined up and in order. As you might have guessed, the first main step is found in establishing good business credit lines.

Please note that building personal credit and building business credit are different. Although they rely on the same principles, there are things in business credit that are not found in personal credit and vice versa. 

For example, in personal credit you have laws that help establish and maintain a correct credit score. With business, there are no laws to protect you. It is up to the business owner to monitor their credit and make the necessary corrections.

1.    You need to first establish a sound business structure. Make sure you are a corporation or LLC per DUN prerequisites. Establishing a solid business structure requires all licensing and tax obligation papers, etc. You want to show you are compliant with law and regulations

2.    Make sure you establish and build credit by purchasing from companies that report to the major credit bureaus: Dun and Bradstreet, Experian and Equifax. You can do this by establishing a net 30 account with these companies.

There are also some aspects you should avoid when looking to build business credit. There are companies out there that look to trick the unknowing. If you are browsing through information and come to one that says you can build your business credit for a certain amount of money, you are looking at a scam. Stay far away from those as possible. Here is what some of them look like.

1.    You can buy trade accounts. This is extremely against the law.  If the credit agencies find out about this, they will purge your credit history. This will also not allow you to establish very good credit history later on, as it will be a permanent blemish on your business credit history. No one likes to deal with a cheat or liar.

2.    There are companies out there that are called shelf companies. They will basically guarantee you a loan based on their credit rating. This is wrong for two reasons. One, you want to build your own credit and relying on someone else is the wrong way to do it. Two, they more than likely will not have the credit to obtain that loan either.

3.    Make sure you have good personal credit as well as good business credit. Do not just rely on good personal credit as a back fall. Remember, you want to keep personal and business completely separate.

If you follow the steps outlined above, you will ensure that you have a good solid foundation to begin establishing business credit that is necessary for advancement and growth. 

To Learn more and start building Business Credit Lines Click Here