Business Credit Card Reviews

Establishing Business Credit and Personal Credit at The Same Time

When applying for a business credit, do you know that your personal credit is also improving. This article is about how your personal credit can affect the future of your business.

If you’re thinking about venturing into business, better check on the status of your personal credit history as well. Although having an excellent personal credit is not a requirement in business, it is definitely an advantage. In what way?

To start a business, you’ll need financing assistance. Regardless of which form of business financing you wish to acquire- whether a business loan, a business credit card, or other financing option, your personal credit history would most likely determine the approval of your application. Obviously, lenders would prefer clients with an impressive personal credit over those with a history of poor credit.

Having an excellent credit score would not only guarantee a quick approval of your loan application, it also opens more doors of opportunities to qualify for loans with lower interest rates and better repayment terms. Although bad credit business loans do exist in the market, they are often accompanied with higher interest rate, lower credit limits, shorter repayment periods and more restrictions.

Build Your Personal Credit to Establish Business Credit

Clearly, building on your personal credit is one way to make things a lot easier for you. Another reason why you should work on raising your credit score is so you can establish your business credit or corporate credit as soon as possible.

Separating your personal credit history from your business credit is a very important issue. Having a corporate credit protects your personal credit history from possible damages that can result if the business you started doesn’t go as well as expected. For instance, if you were late in submitting your payments on your business loan, only your business credit score would suffer. Without a corporate credit, all your business transactions would directly affect your personal credit.

Usually, it takes about two years after establishing your business credit before you can completely separate these two entities. At the start, you’ll have to rely on your personal credit history when applying for business loans or business credit cards. As your business gains its footing however, lenders would begin to recognize your corporate credit history as the basis for their decisions. That’s why it is a must for new business owners to register their businesses with a business credit bureau immediately.

Dun & Bradstreet is the most popular business credit reporting agency in the US. Upon the start of your business, register for your D&B number so you can start building your Paydex Score right away. Just as timeliness of payment plays a major role in building a personal credit score, the same principle also applies to business credit. By staying within your credit limit and paying ALL your creditors on time, you‘ll be building an outstanding credit history for your business.

Building a solid business credit history is a crucial preparation for your company. By the time you’ll need further assistance to finance the growth or expansion of your business, you can be assured that you can get easily approved for business loans that require excellent credit.

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Using Business Credit Cards as an Essential Tools for your Small Business

Every credit cards made especially for every type of business. Business Credit Cards had been proven as an essential tool for a small business. What are the advantages you can get? Let’s find out how.

For small business owners and home based entrepreneurs, the benefits of using business credit cards are too many to be neglected. Consider the following advantages as to why business credit cards are essential tools for every small business.

Manage business expenses more easily. Having a business credit card enables you to separate your personal and business spending. Business credit card issuers also send monthly billing statements as well as quarterly and yearly summaries. Thus, you can easily keep track of where your business funds are spent and use control where it’s needed. These features are especially indispensable as the company begins to expand and expenses start to grow.

Free up your cash flow. It is crucial for a business to have a solid financial resource at all times. A business credit card comes in handy especially when emergency expenses arise. For example, let’s say that you received a large order from a customer at an unexpected time. Even if you don’t have the cash, you can charge to your credit card all purchases that are necessary to deliver the order on time.

Distribute your funds easily. Business credit cards also provide a more convenient way of distributing funds to your employees with the use of supplementary cards or extension cards. If cash is needed in a hurry, there’s no need to go through the long process of requesting for petty cash and wait for approval. Instead, an employee can charge the expense to his extension credit card that is linked to your account. To ensure that the funds are used strictly for business purposes, every purchase is reflected in your monthly billing statement so you can keep track of your employee’s spending.

Manage your account online. Most business credit cards come with an online banking feature which gives the business credit card holder the option to access his account through the internet. This way, you can check your account and send payments at any time straight from your own computer. Any entrepreneur can surely appreciate this convenience.

Get rewarded from your expenses. Many credit cards for small businesses come with rewards. Reward programs vary from travel rewards, gas rebates, and cash backs so you can choose the exact type of program that best fits your business. Enrolling with the right kind of business reward credit card can bring you huge savings and incentives from your spending.

Build your business credit. After registering with a business credit bureau, the only way to build a separate credit history for your company is to acquire new accounts. To build your business credit history, you can choose to apply for a business loan or a business credit card. Once you’re approved for a business credit card, pay attention to how you use your credit limit and how timely you are in submitting your payments. Remember, if you want to enjoy an excellent business credit, you must never exceed your credit limit and you should always pay off your credit card charges on time.

Related Links:

# Business Credit Card Articles
# Business Credit Card Online
# Small Business Credit Cards