Business Credit is credit that is obtained in a Business Name, with business credit the Business builds its own credit profile and credit score and with an established credit profile and score, the business will then qualify for credit.

This credit is in the business name and based on the business’s ability to pay, not the business owners since the business qualifies for the credit, in some cases there is no personal credit check required from the business owner.

The business can use its credit to qualify for revolving store credit cards like Staples, Lowes, Sam’s Club, Costco, BP, Wal-Mart, even MasterCard, Visa, and AMEX. The business can also qualify for credit lines and loans.

A credit profile can be built for a business that is completely separate from the business owner’s personal credit profile. This gives business owners DOUBLE the borrowing power as they have both Personal and Business credit profiles built.

Business credit scores are based only on whether the business pays its bills on time. A business owner can obtain credit much faster using their business credit profile versus their personal credit profile.

Personal Credit Scores are based on 5 factors :

Payment History 35%

Utilization 30%

Length of Credit History 15%

Accumulation of New Credit 10%

Credit Mix 10%

Dun & Bradstreet’s Business Paydex Score are based on Payment History:

Expect payment may come early 100

Payment is prompt 80

Payment comes 14 days beyond terms 70

Payment comes 21 days beyond terms 60

Payment comes 30 days beyond terms 50

Payment comes 60 days beyond terms 40

Payment comes 90 days beyond terms 30

Payment comes 120 days beyond terms 20

Approval limits are much higher on business accounts versus personal accounts. Per SBA, credit limits on business cards are usually 10-100 times higher than consumer credit.

When done correctly Business Credit can be built without a personal credit check . Business credit can quickly be obtained regardless of personal credit quality and there is no personal credit reporting of business accounts.

Most business credit can be obtained without the owner taking on personal liability, or a personal guarantee. This means in case of default, the business owner’s personal assets can’t be pursued.

When a business owner applies for financing, their business credit IS reviewed. Not having business credit established will get an owner DECLINED for financing. There are no regulations that require the lenders notify the business owner for their reason for denial, so most never know.

ANYONE can pull your business credit reports without your permission. Clients, prospects, potential buyers, even competitors can see YOUR business info. This means they can see payment history, high credit limits, employees and revenue, past payment performance and much more.

Almost any business can get business credit as long as it has an EIN number and entity setup. You don’t need collateral, you don’t need financials, you can be a startup and you just need to know the proper building steps.

ALL highly-successful businesses have business credit, it’s a “right of passage” to ever reach TRUE success

A business starts building a brand new credit profile much the same as a consumer does. The business starts with no credit profile. The business gets approved for new credit that reports to the business credit reporting agencies.

The business uses the credit and pays the bill timely. A positive business credit profile is established. As the business continues using the credit and pays bills timely it will qualify for more credit.

The perception lenders, vendors, and creditors have of your business is critical to your ability to build strong business credit. Before applying for business credit a business must insure it meets or exceeds all lender credibility standards. There are over 20 credibility points that are necessary for a business to have a strong, credible foundation.

It is very important that you use your exact business legal name . Your full business name should include any recorded DBA filing you will be using. Insure your business name is exactly the same on your corporation papers, licenses, and bank statements.

You can build business credit with almost any corporate entity type. If you truly want to separate business credit from personal credit your business must be a separate legal entity not a sole proprietor or partnership

Unless you have a separate business entity (Corporation or LLC) you might be “doing business” but you are not truly “a business“. You need to be a Corporation or an LLC in order to separate personal from business +.

Whether you have employees or not, your business entity must have a Federal Tax ID number (EIN). Just like you have a Social Security Number, your business has an EIN

Your Tax ID number is used to open your bank account and to build your business credit profile. Take the time to verify that all agencies, banks, and trade credit vendors have your business listed with the same Tax ID number.

Business Address must be a real brick-and-mortar building deliverable physical address. It cannot be a home address, cannot be a PO Box and cannot be a UPS address. Some lenders will not approve and fund unless this criteria is met.

Address only, receive mail and packages at your dedicated business address.

Virtual office, professional business address, dedicated phone and fax numbers, receptionist services, and part-time use of fully furnished offices and meeting rooms.

True Office, your own full-time private office with receptionist services, dedicated phone and fax, internet, full furnishings, meeting rooms, and more.

You must have a dedicated business phone number that is listed with 411 directory assistance, under the business name. Lenders, vendors, creditors, and even insurance providers will verify that your business is listed with 411. A toll-free number will give your business credibility, but you must have a LOCAL business number for the listing with 411 directory assistance.

Lenders perceive 800 Number or toll-free phone numbers as a sign of business credibility. Even if you’re a single owner with a home-based business, a toll-free number provides the perception that you are an even bigger company. It’s incredibly easy and inexpensive to set-up a virtual local phone number or a toll free 800 number.

A cell or home phone number as your main business line could get you “flagged” as an un-established business that is too high of a risk. DON’T give a personal cell phone or residential phone as the business phone number. You can forward a virtual number to any cell or land-line phone number.

Lenders perceive a credible business as one with a fax number. As a business you will need a fax number to receive important documents, you will also need it to fax in some of your credit applications. You can setup an e-fax that goes directly to your email.

Credit providers will research your company on the Internet. It is best if they learned everything directly from your company website. Not having a company website will severely hurt their chances of obtaining business credit.

There are many places online that offer affordable business websites so you can have an internet presence that displays an overview of your company’s services and contact information.

It is important to get a company email address for your business. It’s not only professional, but greatly helps your chances of getting the thumbs up from a credit provider. Setting up a business email address is just too easy and inexpensive to neglect.

Avoid using free email services like Yahoo and Hotmail . There is nothing worse than credit providers seeing an email address like

The Email address should be A great example is an email like or

Your business banking history is vital to your future success of being able to secure larger business loans. The date you open your business bank account is the day that lender’s consider your business to have started.

So if you incorporated your business 10 years ago, but you just opened the business bank account yesterday, then your business started yesterday. The longer your business bank in history, the better your borrowing potential will be.

Having a high account balance is essential in obtaining an excellent Bank Rating. Having a good Bank Rating is essential for loan approval down the road. Try to keep a bank balance of $10,000 or higher for a 5 Bank Rating.

One of the most common mistakes when building credit for your company is non-matching business addresses on your business licenses. Even worse is not having the “required” licenses for your type of business to operate legally.

You will need to contact the State, County, and City Government offices to see if there are any required licenses and permits to operate your type of business.

On licensing State business, County license and/or permit, City license and/or permit filings and IRS filings listed correctly.

Take the time to verify that main agencies (State, IRS, Bank, and 411 national directory) have your business listed the same way and with your Exact Legal Name.

Also take the time to ensure every bill you get (power bill, phone bill, landlord, etc.) has the business name listed correctly and comes to the business address.

Business Credit reports are offered by Experian, Dun & Bradstreet, and Equifax. You will first want to get a copy of your business credit reports to see what is being reported.

Visit for a copy of your Smart Business report and $49-99 for Smart Business Report. Find out how many trade lines are reporting, see if you have a business credit score assigned, see if you have an active Experian Business Profile, and check on recent inquires.

You can purchase a copy of your Equifax Small Business Credit Report here It typically takes more time to create a file with Equifax Small Business than D&B and Experian

This is why it’s important to apply with the credit providers who report to Equifax and $99.95 for a full report. Obtaining a Dun and Bradstreet number (D-U-N-S #) begins the process of building your business credit profile with them.

Your D-U-N-S # will also play an important role in enabling your business to borrow without a personal guarantor, DBC will “roll” this into a package and charge you 2k or possibly more.

You can also enroll for the DNBi SelfMonitor to monitor your credit during the building process. A subscription for D&B Self Monitoring is $39-99 per month.

A business credit report can be started much the same as a consumer report commonly is, with small credit cards. The business can be approved for small credit cards to help them build an initial credit profile. These types of initial cards in the business world are commonly referred to as “vendor credit”.

A vendor line of credit is when a company (vendor) extends a line of credit to your business on “Net 15, 30, 60 or 90” day terms. This means that you can purchase their products or services up to a maximum dollar amount and you have 15, 30, 60 or 90 days to pay the bill in full. So if you’re set-up on Net 30 terms and were to purchase $300 worth of goods today, then that $300 is due within the next 30 days.

You can get products and services for your business needs and defer the payment on those for 30 days, thereby easing cash flow

And some vendors will approve your company for Net 30 payment terms upon verification of as little as an EIN number and 411 listing.

Here are some vendors who will approve you for initial credit… even if you have none now:

Laughlin and Associates




Always apply first without using your SSN. Some vendors will request it and some will even tell you on the phone they need to have it, but submit first without it.

When your first Net 30 account reports your “tradeline” to Dun &

Bradstreet, the DUNS system will automatically activate your file if it isn’t already. This is also true for Experian and Equifax.

You need to have a total of at least five (5) Net 30 day pay accounts reporting/Some vendors require an initial prepaid order before they can approve your business for terms. Your vendors do not necessarily have to serve 100% of your business needs.

Pay your Net 30 vendor accounts in-full and on-time. You must be patient and allow time for the vendors’ reporting cycles to get into the reporting systems .It typically takes 3 cycles of “Net” accounts reporting to build credit scores.

Most Merchants and major retailers do offer business credit, they just don’t advertise it. There is no benefit to the merchant to promote credit with no personal liability if the business owner is willing to take on that liability so they don’t promote their business credit cards and regularly ask for a SSN.

After 5 trade lines are established using vendor accounts, obtaining revolving accounts is the next step. Revolving accounts are cards a business owner can use and not be required to pay the full balance owed each month.

Revolving account approvals will begin coming from stores. Store revolving credit must be obtained before the business owner starts getting Visa, MC, Amex, type cards.

Most stores will NOT approve a business owner for business credit unless the owner has an established credit profile and score, just like in the consumer world. Vendor accounts must be used first to establish a profile and score, then store credit can be obtained. It usually takes only 90 days or less to establish a score and profile with trade lines.

Most major stores do offer business credit including: Home Depot and Lowes, Office Depot and Staples, Best Buy, Walmart, Sam’s Club, Costco, Amazon, Dell, Apple, BP, Chevro, Racetrack and most others.

Once 10 total accounts are on the credit, an owner can then start applying for Visa, MC, Amex type credit. Approval amounts will be equivalent to the highest credit limit account on the business report. Try to have 10 accounts with at least one of hem having a 10k high limit.

It is essential to keep using the credit, keep applying for more, and talk with credit providers to raise credit limits. If you do this, business credit will keep growing until higher limit credit lines are obtained, within 6-12 months.

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Most Common Ways You’re Accidentally Hurting Your Business Credit

Running a small business is a juggling act, and sometimes you have to make tough financial decisions. Have you ever had to decide between making payroll or paying your vendors on time?

Most of us have been there and—for good reason—paying staff usually wins out. But, blowing off your vendors does more than just strain your business relationships. It also hurts your business credit scores.

In a case like this, you may feel like it’s worth the hit to your credit. And I wouldn’t blame you. What you do want to watch out for is doing things that unnecessarily hurt your company’s credit.

It’s one of the main ways that lenders, creditors, and vendors evaluate your financial health.

Let’s explore some of the most common credit mistakes, so that you can avoid accidentally ruining your business’s credibility and hurting your financial health.

1. Not Checking for Report Errors

Business credit report errors are more common than you think. A Wall Street Journal survey showed that 25% of small business owners who looked found credit-damaging errors on their reports. Without knowing it, these errors could be killing your business credit scores.

Often times, mistakes can be something as simple as incorrect data, like outdated revenue figures or an incorrect industry classification code (SIC). For example, being coded as a “real-estate investment” company carries a higher credit risk.

Another common problem is mismatched business profiles. It’s easy to see why this happens:

1. To populate a consumer report, the bureaus look at four items: Social Security Number, Date of Birth, Address, and Name. A minimum of 3 of the 4 items have to match. That’s why it’s rare for personal credit profiles to get switched up.

2. For businesses, the bureaus just use the business name and address to populate a report—but the data doesn’t have to be exact. Think how easy it would be to cross up franchises that share a common DBA!

Take a little time to review your reports from each of the three main business credit bureaus (Dun & Bradstreet, Experian, and Equifax) to ensure that your information is correct.

2. Paying Bills Just A Little Late

When it comes to business credit, even being a little late paying your bills can hurt your scores.

With personal credit, you get 30 days to make your bill payments before it’s marked late and lowers your scores (like a credit card bill). Business credit doesn’t work this way. Making a payment that is even one day late can cause your scores to drop.

Let’s say that one of your vendors offers you net-15 terms, giving you 15 days to make your payment for goods or services they already delivered. If you pay—or they receive your payment—on day 16, they can report you as paying one day beyond terms, which hurts your scores.

Dun & Bradstreet’s PAYDEX score (the primary score used by vendors to evaluate a company’s creditworthiness) is solely based on your payment history. The score ranges from 0 to 100 and the higher it is, the better.

If you pay all your business bills exactly on the date they are due, you’ll get a PAYDEX of 80. To get a higher score, you actually have to pay your business bills before the due date.

3. Only Relying on Personal Credit

When just starting out, it’s common for business owners to rely on personal money and credit cards to fund their new venture. But, maxing out your consumer credit cards to run your business can kill your personal credit scores.

Plus, it doesn’t help you establish strong business credit. Having a thin business credit file can be just as damaging as having poor credit.

One of the first things you should do after starting a business is open a couple business credit cards. Just be sure that the bank issues the card in your company’s name and reports to your business credit, not personal. You probably won’t qualify for a big credit line at first, but that’s fine. It’s helping you build business credit, which will let you secure more capital over time.

A business can typically access 10 to 100 times more credit than a consumer. You’ll need this extra credit capacity. On average, businesses use credit at ten times the rate of a consumer. It’s nearly impossible to scale a business by relying on personal credit alone.

4. Not Monitoring Your Credit

A common way that business owners trip up their credit is by only checking it when they need to use it. Your vendors and lenders continually monitor your business credit, and so should you. This doesn’t mean you have to add more work to your plate.

Free business credit monitoring tools exist that keep watch of everything for you and will send alerts if something changes. Credit scores typically don’t change much, so a significant drop could be an indication that something serious has happened, like identity theft. Small businesses are just a susceptible to it as consumers.

Don’t shoot yourself in the foot by making avoidable credit mistakes. It’s not hard to take these steps, and they can save you a lot of stress down the road.

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