One of the most common financing mistake I see business owners make it simply not knowing how to set up their business to maximize their business credit rating – and improve their funding. They never establish a business credit score separate from their personal score, and without the proper foundation you are doomed from the start.
So, step one is very simple, create a corporate entity separate from your personal identity. Once accomplished, you have a legal entity separate from yourself. Lets understand what it will take to get you the maximum funding in the shortest amount of time and at the best possible rates.
While others may try to convince you it is possible in a few weeks or a couple of months, it is not. Sorry to burst your bubble, but that little reality could save you $500 – $2500 in bogus credit service fees. If someone promises you great credit, unlimited capital or anything else that seems “too good to be true”, rest assured it is.
Your business sense is probably a pretty good guide here. Don’t let your desperation for capital cause you to make a poor business decision. Building credit is a process. We can guide you through this process, but there is no magic wand that will give you great credit and access to bunches of capital instantly – sorry.
Keep in mind that access to well priced capital will be critical for your business. It will either be a chronic problem or a competitive advantage for you so you should begin the process of stronger business credit right now.
There are 11 key steps to building your credit and you should know what they are and how they will affect your business as you apply for financing. You can learn about all of them in our report: Capital Access and Rate Enhancement. It is a must read and we’ll email you a copy if you’ll click HERE and request CARE report in the subject line.
As you’ll learn in the report, you’ll need A) 1 bank reference (the report will show you a little trick worth it’s weight in gold), B) 5 trade referenced that report directly to the credit agencies and C) a credit file at all three rating agencies, D&B, Experian and Equifax.
Some out there will try to sell you on the idea that all you really need is a D&B number and a Paydex score. That may be true if you only aspire to “trade credit”. However, to get favorable lease terms and bank lending, D&B alone will not cut it.
While this sounds like a lot of information it’s covered in complete detail in our CARE report, which you can request HERE.
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According to your post, this is an ideal situation for a business owner, like myself, to acquire venture capital for my business.
However, in reality, I find this is not the case.
I have great credit. I have paid off previous bills, and I pay my current bills on time. But because of the current level of activity in my business, I want to expand my services, which requires additional equipment and financial resources outside of what my business is capable of.
Because I placed so much faith in my ‘great’ credit, I approached several banks and applied for a loan with a business line of credit. I was informed, as a matter of fact, that because I am writing off all my expenses to my bottom line, I did not qualify for the loan. The banks I approach are basically telling me that my business is not making enough money.
Does anyone know of an existing resource that caters to business owners in my position? I am desperately trying to keep up with the pace of a competitive industry.
What would be your explanation for my failures?