Personal Business Cards » Personal Finances

Building Business Credit

admin — Sun, 18 Apr 2010 09:13:10 +0000

Building business credit is an important element especially when you need to borrow money for starting new business or expanding your current one. Most businesses want to be able to borrow money when they need it, without the owners having to guarantee the loans personally so as to minimize their risk.

There are essentially some important steps to follow while establishing business credit:
Setting up a correct corporate structure and ensuring that your business appears stable and real to the credit bureaus. This means that you must get the proper occupational licenses and a listed phone number with directory assistance in the businesses’ name, among other things.

Borrowing or buying products and services from companies that will report your credit history to the major business credit reporting agencies such as Dunn & Bradstreet and Experian. Unlike personal credit ratings, best business credit scores are reserved for large stable businesses with several million dollars in sales a year and 25-50 or more employees. However, you can start small and gradually build your business credit rating to get the requisite borrowing power that your enterprise will eventually need.

It is essential to separate your personal credit from your business credit. Thus, even if your business fails to pick up, your personal credit will remain untouched. Similarly, if your personal credit takes a downward spiral, your business rating might also get affected even though it may be doing well and have nothing to do with your personal finances.

To ensure this separation and build business credit, you need to first form an LLC whereby your business becomes an entity unto itself. Next, you must have a Federal EIN and open a separate bank account under the exact legal name of the business and obtain all necessary business licenses, permits, etc.

It is imperative to open a business credit file with all of the three major business credit reporting agencies, obtain five vendors and/or suppliers that will extend a small amount of credit to your business and report your payment histories to these agencies.

Get three business credit cards, the transactions of which will be reported to the business credit agencies. Most importantly it is important that you pay all your bills on time.

By: William Brister

Small Business Finance – Help Budding Your Business

admin — Thu, 11 Mar 2010 12:36:34 +0000

Most of small business packages are adept at handling your personal finances, but only a handful of equipped to manage you business affairs, simply money, which supports entries for accounts payable and receivable, is the strongest package out of the box. To this prospect, small business finance has been propped up for entrepreneurs. However small this business provision is, it helps build a longer and successful infrastructural development of borrowers’ enterprises.

Before applying for this financial provision, applicants are required to chart out a small business plan. The plan should as successful in nature that it may envisage an anticipated success in business. For that, check you business plan, go through it again and again and try of find out shortcomings if any. Invest your time in solving the problem.

After, with that business plan go straight to any loan provider. Present it before your lender selected. And use best of your financial knowledge to convince the lenders with your reply. Once you bring around your lender with your business plan, a half of your problem is sorted out.

Seeing your financial feasibility, lenders offer with the obtaining financial options. Generally, small business finance is of two types i.e., secured and unsecured. For the former collateral arranging keeps an important place, while the latter, unsecured format remains devoid of it. As of lacing in pledging placing, more borrowers feel safer securing unsecured form of small business finance. Since there is no security of the borrower with lender, lenders compulsively incur upon higher interest rates.

Many lenders are available online and offline for business finance. Nonetheless, making practising simple and fast, online applying is preferred these days. The way is very simple and convenient. Entire of the processing is done right online. Just in click and innumerable sites of different lenders gets opened before you, you are only required to select a right lender of your choice.

By: Ben Gannon

How to Manage Business Credit Card Debt Properly

admin — Mon, 19 Oct 2009 03:46:58 +0000

Starting up a business involves expenses. For most new entrepreneurs, a loan is a must in order to get the business started. Aside from business loans, additional support may be necessary in keeping up with the production and operating costs. Small business credit cards often provide this much-needed financial assistance to business owners.

Why Get a Business Credit Card Debt

Some people may be skeptical about obtaining cards for business because they are afraid that credit cards may lead to uncontrolled spending and debt. However, business credit cards can be great tools not only in keeping a steady cash flow but also in separating your business and personal finances. With the help of business cards, monitoring your expenses is also a lot more convenient and easy. How can you get the most from your business credit card? How can you avoid credit card debt?

Obviously, proper management and control is needed to avoid the risk of card debt. For instance, some entrepreneurs may be prone to charging their personal expenses on their business credit card but such a habit can easily lead to uncontrolled debt. As a business owner, you need to make sure that your business credit card is exclusively used for official business purposes.

Submitting your credit card payments on time is also crucial if you want to stay away from trouble. It could be tempting to pay only the minimum due even if you have the cash to pay your balances in full. But carrying over your balances from month to month also means paying for the additional interest charges. Thus, to avoid unnecessary costs, make it a point to completely pay off your charges each month.

Business Credit Card Debt Consolidation

But what if you’re already stuck in card debt? What can you do about it? A business owner has two options to solve this problem. One is by acquiring a debt consolidation loan to pay off all existing balances and stop the interest rates from accumulating further. By combining his credit card debts into a single loan, the interest rate is reduced and monthly payments are significantly lowered.

Another way is by getting a balance transfer credit card with low interest or zero interest. This would enable you to pay off all the balances you transferred at a low rate or zero interest. However, take note that the 0% APR is only applicable for a limited time, so you must take advantage of this opportunity by completely paying off all the debts you’ve transferred within the zero interest period.

Any of these two card consolidation options can work but in order to be effective, a business owner needs to ensure that he/she can pay bills without a single delay or miss. It would also be wise to avoid incurring new debts while still working on your repayment. Finally, once you’re done with your repayment, you need to a lot more careful about using your business cards to avoid falling in the same debt trap again.

By: Pamela Williams

Small Business Credit Cards in Today’s Recession

admin — Sun, 18 Oct 2009 11:45:21 +0000

Today’s recession has had an impact on personal and business credit cards. Over the past 1-2 years many any people are receiving letters from their credit card lenders informing them of an increase in interest rates or a decrease in the credit limit.

Small business credit cards can be an additional source of financial income. They also help in keeping other lines of credit open. Using this type of credit card can ensure that suppliers are paid on time while giving the business an interest-free period (float) in order to obtain enough money to pay off the credit card debt. As the recession has begun to deepen, businesses have found that obtaining credit cards for their business has become much more difficult.

The worst thing a new business owner can do is to use their own personal credit card to finance their business purchases. This makes it very difficult to separate business and personal finances, but also makes the individual responsible for the debt of the business. Not a good thing!

Some businesses are using business even credit cards to pay their tax bill, which is tempting as it avoids any fines for late payment. There is however a fee for doing so. Usually, this fee is significantly lower than the penalty would be for not paying taxes on time.

There are still plenty of opportunities out there for small businesses who have good credit record to take advantage of their business’ credit cards. Even though lenders are stricter in their acceptance criteria than in previous years, you should not give up. Before applying for credit make sure that you meet all the requirements for acceptance. Every time your credit is check, the credit score goes down. As a result, only apply for cards when you feel confident that you will be accepted.

By: Ron Lerman