What are Private Business Lenders and Private Business Funding?
Real estate investing is big money. But not every entrepreneur qualifies for loans from big banks, and other traditional sources. Not to worry, there are private lenders out there, willing to lend money. Private money business loans just might be the solution you’re looking for – from private business lenders.
What are Private Business Lenders?
Private business lenders are generally funded by investors, or by banks, or both. Private lenders are in the business of taking funds from private investors. They make private business purpose loans with those funds.
Investors expect a decent return from their investments, and interest rates from money borrowed from banks is significantly higher, than the banks are being charged for the funds. These factors raise the private lender’s expenses. Those expenses are then passed on to the ultimate borrower. Unlike with angel investing or venture capital, the borrower isn’t giving away a percentage of ownership.
Why Work with Private Business Lenders?
Apart from possibly not qualifying for traditional lending, there are other reasons why it may be better to work with a private lender. Banks are often tougher to deal with than private lenders. Banks are subject to significant state and federal regulations. They must work within governmental and quasi-governmental agency programs, like Fannie Mae, Freddie Mac, the VA, and HUD. These regulations often dictate which businesses a bank can lend to, and what borrower profiles should look like.
Private business lenders, while still subject to state and federal laws, are significantly less regulated. They can be more flexible in the types of loans they make, and who their customers are.
Hence is it generally easier to get approval from a private lender, versus a traditional bank. Private lenders can customize each loan based on a set of internally set criteria, like credit scores, loan to value ratio, and debt to income levels.
In contrast, bank approvals are program or computer driven. The lender only has a little discretion. Private lenders tend to take a more common sense approach, to understanding borrower issues and overcoming them.
Banks tend to look at financial histories and credit through easily traceable and documented income sources. This makes it very difficult for self-employed borrowers, for example, to qualify for bank loans.
A hard money loan is a type of real estate loan. It is issued by a private lender for non-owner occupied property. Hard money loans are usually short term. They tend to be between six and 36 months. They have a higher interest rate than traditional bank loans.
Let’s look at Hard Money Loan Approvals
You get approval for hard money loans based on the value of the real estate, rather than the creditworthiness of the borrower. These loans are often used because they have an exceptionally fast approval time. They are often closed within two to four weeks.
What is the Difference Between Hard Money Loans and Bank Loans?
The main difference is the lender. Hard money loans are almost always given by a private lender. This is so whether that’s an individual or a private lending company. These loans are used for non-owner occupied real estate. So they aren’t regulated like consumer mortgages. As a result, hard money lenders can charge higher interest rates and fees, and they can get away with terms that wouldn’t be allowed with traditional loans.
The Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act (RESPA) don’t often apply to commercial mortgages. But there are still regulations traditional financial institutions must follow. Federally insured banks are still regulated by the FDIC. Credit unions are regulated by the National Credit Union Administration (NCUA). But hard money lenders don’t have any regulations placed on them.
What Sorts of Real Estate is Covered by Private Money Financing?
A hard money lender may loan on any type of non-owner occupied real estate. This includes all sorts of real estate investments. But they’re often looking for situations with a fairly quick exit strategy, so they know they’ll get paid by the end of the loan term.
Let’s look at Private Small Business Loans for Fix and Flip Properties
Hard money loans are very common with fix and flip properties. In fact, many lenders will even finance the repairs. These types of deals are ideal for the lender because flips tend to be completed within six months.
If the lender is also financing the repairs, they will estimate the cost of the repairs, and issue draws as the borrower needs them to pay for the work being done. This ensures the funds are being used for the repairs. It also limits the lender’s exposure, since they’re only giving out a small amount of money at a time.
Many hard money lenders prefer to finance the repairs. This way, they know the project will be completed. If the borrower gets through the demolition and runs out of money, the value may become less than the purchase price. By financing the project, they don’t have to worry about the borrower not being able to finish the job due to a lack of funds.
Consider Hard Money for Rentals
Hard money lenders will also provide short-term loans for residential real estate investment properties. The goal here is often to refinance the property in 12 to 36 months, to be able to pay off the hard money loan. Investors may use a hard money loan for a rental property if they need to be able to close the deal quickly, and don’t have the time to go to a bank. Or they may need a private loan if the rental property needs repairs before a bank will finance the deal.
Let’s look at Hard Money for Multifamily Properties
Like loans for rental properties, investors may need capital quickly to close on a multifamily property. This is the case if there’s not enough time to go through the traditional lending process. Private money lending is just plain faster.
An investor may also be buying a multifamily property with little to no tenants that needs a lot of repairs. This type of property would be hard to get financed with a bank, so they may seek out a hard money loan. Investors can get the necessary work done. And they can lease the property before refinancing it with a long term loan.
Consider Hard Money for Commercial Real Estate
A common situation with commercial real estate is an investor having a tenant to lease space to, but no property to put them in. The investor will find a vacant property that the tenant will lease out, but they have to buy the property and get it ready for the tenant first.
A bank may not want to finance a vacant property intended for use as an investment if the borrower doesn’t have the assets to secure the loan. A hard money loan can be useful in this situation to get the deal done. The investors can accomplish the tenant improvements and get the property leased. Once the tenant is in place and paying rent, a bank will be more willing to finance the real estate.
Check out Interest and Fees on Hard Money Loans
The convenience and easy approval with a hard money loan comes at a cost. Lenders will charge higher interest on hard money loans. This is because they are higher risk loans. It is also because these loans are short term.
Longer term loans will earn interest for several years from processing one loan. But the money invested in hard money loans must be reinvested every six to 36 months. There’s added cost and new risks each time that money is invested in a loan. Interest rates for these loans tend to be a few percentage points higher than traditional bank loans.
The lender will charge upfront fees to cover the cost of processing the loan, plus any commissions being paid. This also ensures they still earn a profit; in case the borrower pays off the loan before the end of the term.
Common fees for a hard money loan include origination fee, broker fee, application fee, underwriting fee, document prep fee, processing fee, and funding fee. These fees can add up to thousands of dollars.
Consider Credit Checks and Property Values
In general, private lenders are going to be all right with average credit. Their main concern is the value of the property. Plus a lender wants to know the market the property is in. This is due to higher risk. The lender wants to be able to recover their costs in case of foreclosure. See fool.com/millionacres/real-estate-financing/hard-money-loans/5-best-hard-money-lenders.
More Details on Private Small Business Loans and Hard Money Loans
There is a balloon payment at the end of the short term. For fix and flip, the lender knows the borrower can afford the balloon payment. But in the case of a borrower looking to refinance the property by the end of the term, the may not be as willing to lend to someone with bad credit. They will look closer at the borrower’s credit and personal finances in this case. The lender may also require a higher down payment to limit their risk in case the borrower can’t pay the lender off at the end of the term.
Private lenders for business loans will look into a borrower’s experience. For a fix and flip, private business lenders will want borrowers who have completed at least a few other deals. Smaller lenders usually stick to markets they know and states that have a strong real estate market. They often don’t like rural properties and provide a lower loan to value for them.
Private Money Financing: Takeaways
Private money financing is a way for real estate investors and house flippers to get funding. Also called hard money loans, private money financing tends to have fast approvals, but higher interest rates and no regulation to speak of. Experienced flippers in urban areas with good real estate markets are more likely to get approval.
These days you can find anything online. In fact, you can even find an online business loan. Some business owners shy away from this option because of the fear of predatory lending. It is possible to find online lenders that will work for your business though.
Is an Online Business Loan for You?
So, is an online business loan right for you and your business? Here are five ways to know.
You do not qualify for a loan from a traditional lender, like a bank or a credit union.
Online lenders tend to have less strict application requirements, including lower credit score minimums.
2. There is no time to wait.
You need funds quickly. Online lenders typically fund much faster than traditional lenders.
3. You flexible terms.
Online business loans often have more flexibility repayment options.
4. You have invoices or accept credit card payments.
Online lenders often offer invoice financing and merchant cash advance options.
5. It’s impossible for you to wade through the paperwork necessary for a traditional loan.
Online lenders usually have super fast application processes. Most of the time you can apply online for a business loan in just a few minutes.
Find out why so many companies use our proven methods to get business loans.
Where Can I get a Business Loan Online?
There is no shortage of options for online lenders out there. However, you must be careful to choose the best one for you. It is extremely helpful to have a business credit expert help you. Still, here are a few to help get you started on your search.
Remember, details for an individual online business loan or lender, such as interest rates, fees, and credit score requirements, can change frequently. Always check with the lender directly for the most up to date information.
BlueVine
BlueVine offers funding up to $100,000. Annual revenue must be $120,000 or more and the borrower must be in business for at least 6 months. Your personal credit score has to be 600 or above. It is important to note also that BlueVine does not offer funding in all states.
Upstart
Upstart is an online lender that uses a completely innovative platform for loans. The company chooses to use a combination of artificial intelligence (AI) and machine learning to gather alternative data instead of relying solely on credit score. They then use this alternative data to help make credit decisions.
It can include such mobile phone bills, rent, deposits, withdrawals, and even other information less directly tied to finances. The software learns and improves on its own. You can use their online quote tool to play with different amounts and terms to see the various interest rate possibilities.
To be eligible for a loan with Upstart, you must meet the following qualifications per their website:
Credit score of 620+
No bankruptcies or negative public records
No delinquent accounts
Meet debt to income standards (they only note they will check this ratio, not what their standards are.)
Have fewer than 6 inquiries in the past 6 months on your credit report, not including those related to student loans, vehicle loans, or mortgages
Find out why so many companies use our proven methods to get business loans.
Fundbox
Fundbox is a great option because there is no minimum credit score requirement for their line of credit product.
They offer an automated process that is super-fast. Repayments are automatic, meaning they draft them electronically, and they occur on a weekly basis. One thing to remember is that you could have a repayment as high as 5 to 7% of the amount you have drawn currently, as the repayment period is comparatively short. This means you need to be sure you have enough funds in whatever account you connect them to so that it can cover your payment each week.
Fora Financial
Founded in 2008 by college roommates, Fora Financial now funds over a million in working capital around the United States. There is no minimum credit score, and there is an early repayment discount if you qualify.
The business must be at least 6 months in operation and the monthly revenue has to be $12,000 or more. There can be no open bankruptcies.
Bond Street
Offering term loans of up to $1 million, Bond Street will ask for both EIN and SSN.
Their offer arrives within 3 days. They will only do a soft credit pull, and a 640 or better credit score is likely to get you a loan. However, they will look at other factors too. For example, they require 2 years in business and annual revenue of at least $200,000.
Lending Club
Lending Club offers term loans. Business loans go up to $300,000. You can get a quote in less than 5 minutes. Funds are available in as little as 48 hours if approved. There are no prepayment penalties.
Annual Revenue must be $75,000 or more. You must be in business for 2 years or more. Personal FICO score of 620 or better is required.
Rapid Advance
Rapid Advance offers standard, select, and preferred loans. Your company must have annual revenue of $120,000 or more. You must have a personal FICO Score of 580 or better. The minimum time in business is 2 years.
Kiva
Kiva is an online lender that is a little different. For example, the interest rate is 0%, so even though you have to pay it back it is absolutely free money. They don’t even check your credit. However, there is one catch. You have to get at least 5 family members or friends to throw some money in the pot as well. In addition, you have to pitch in a $25 loan to another business on the platform.
OnDeck
Obtaining financing from OnDeck is quick and easy. First, you apply online and receive your decision once application processing is complete. If you receive approval, your loan funds will go directly to your bank account.
You need a personal credit score of 600 or more. Also, you must be in business for at least one year. Annual revenue must be at or exceed $100,000. In addition, there can be no bankruptcy on file in the past 2 years and no unresolved liens or judgements.
Find out why so many companies use our proven methods to get business loans.
Accion
If your personal credit is okay, Accion may be a good fit. It is a microlender, a nonprofit, that offers installment loans to both startups and already existing businesses. The minimum credit score is 575. In some places they will go as low as 500. You don’t have to already be in business, but if you are not, you must have less than $500 in past due debt. In addition, your business needs to be home or incubator based.
Credibly
Credibly is also a good option for business loans if you are already generating some revenue. They offer short term loans for both working capital and expansion. You must be in business for at least 6 months to qualify, and they will approve loans to those with credit scores as low as 500.
Do You Need an Online Business Loan?
You might. If you fall under any or all of these 5 reasons, an online loan may very well work for you. Business funding is a difficult landscape, and there are many more options than most realize. Consider these options, do your research, and don’t be afraid to ask a business credit expert for help. It could very well propel your business to new heights.
Chances are, your brand has data scientists and operations professionals on the team, and while they do their best to collaborate, they each have their own areas of expertise.
This could lead to miscommunications and misunderstandings. The data scientists can interpret the data, but they likely don’t have the background to manage business operations. Likewise, the business team can make their side of things work, but they don’t fully know how to interpret and implement data.
Here is where machine learning operations (MLOps) come in.
In this article, we’ll discuss how MLOps can help with collaboration between your data and business teams, as well as additional immediate and future benefits of implementing it.
What is MLOps?
MLOps, in simple terms, is a set of best practices for improving communication and collaboration between your employees on the data science and operations sides of your brand.
In less simple terms, it’s a combination of machine learning, data engineering, and development operations. The goal is to provide a more streamlined process for developing and creating machine learning systems, allowing business administrators, data scientists, marketers, and IT engineers to cooperate on the same level.
It is an extension of what we know as DevOps. DevOps is the process of organizing cooperation between everyone involved in the design and building of big data. This process has been around for a while, but MLOps is still in its youth.
MLOps creates a lifecycle and a set of practices that apply to the development of machine learning systems. This includes research, development, operations, and implementation.
The process of brainstorming, developing, and implementing machine learning is extensive. Having a set of duplicatable processes to guide each project helps in many ways.
5 Benefits of MLOps
Now that we have a general understanding of MLOps, let’s look at how it can impact our businesses. All new technology has either a positive or negative effect on the digital marketing industry, so it’s crucial we understand what we’re getting.
1. MLOps Can Increase Efficiency and Automation
Making the most of our time is something most of us strive to do.
Ironically, we spend a lot of time figuring out how to do this.
We may look into all different kinds of apps and books. We could spend days reading articles or even attending seminars on efficiency and time management.
But, perhaps automating would be simpler for many people.
Automation, by definition, should increase efficiency. Once minute tasks are out of people’s hands, they can focus on big picture issues.
An essential but draining task many folks on data science teams spend time doing is data entry. That’s time they could spend focusing on the science rather than passively improving their typing skills (and, we all know, a typo in data entry can bring disaster!).
MLOps gives options for automating tasks like data entry. It takes some work upfront, but once things are going, the data scientists can get back to what they do best.
2. MLOps Eliminates Waste
MLOps helps businesses improve communication and avoid bottlenecks and costly errors.
How much time have you wasted answering the same questions, reiterating a previous point, or working extra hours to clean up an error because someone simply didn’t know what to do—or what someone else was supposed to be doing?
If you had a set of operations for each employee or contractor to follow, there would be no need to answer the same question continually. You could send them an operations checklist, and they work through it until completion.
The best thing about this is it’s highly duplicatable. I’ll use the example of a content marketing company creating content for its clients.
Let’s say you run a site reviewing camping products. Every page should follow the same basic format so your readers can easily compare products or skim to the parts they care about most.
Suppose you give your reviewers and editors a template to follow, step-by-step instructions, and information about what the others are doing. In that case, confusion can be lessened, and you can focus on which hiking boots are best in winter weather.
MLOps does this, not for content, but for communication. It allows leaders to share “templates” of what should be done on a given day and, after any frontloading, questions should lessen and related waste eliminated.
3. MLOps Focuses on Collaboration
As mentioned, a lack of communication can kill a business quickly. Collaboration between departments is so crucial. Otherwise, work gets lost, notes aren’t passed on, things get missed—and tempers may flare.
MLOps creates procedures for passing one task on to another department. The word “lifecycle” is often used to describe this process.
As a project moves through the lifecycle, workers should be able to see what has happened, what should be happening now, and what will happen next.
This is where we put on our marketer hat and look towards tools like ClickUp and Trello. These are useful for managing large numbers of tasks at the same time.
People involved in the project can access things like checklists and previous conversations at all points in the pipeline, eliminating the wait for responses on work chats or dealing with the dreaded group email.
Communications come in order, everyone who needs to be in on the conversation can be, and they’re unlikely to get lost in dozens of messages.
This process also allows for documentation. Not only does this create a paper trail of who did what so the right people can be given feedback, but it also eliminates miscommunication because it’s all outlined already.
4. MLOps Supports Machine Learning Models
Reducing the amount of variation from one project to another is an important key to scaling any business. MLOps help do this by creating reproducible models you can use as a benchmark at the beginning of each new project.
These data set registries help track resources, project data, logs, and metrics. These factors combined eliminate bottlenecks, reduce wasted time, and help move projects through the pipeline faster.
Essentially what you’re doing is creating a template that can be used over and over. These machine learning “templates” or “models” help reduce production time and produce a better product by having a benchmark to follow each time a new machine learning model comes out.
Having a duplicatable model is vital in marketing because it allows you to input any variable and experience the same result. SEO is an exceptional example of this.
Once you have a proven strategy to create content, upload it, optimize it, drive links to it, and re-optimize, you’ll never have to worry about variables because the steps are the same.
It wouldn’t matter if you were ranking an article about ergonomic keyboards or funeral home carpeting because the bones are the same.
It starts with providing those in need with the resources they want on their own time. We live in a 24-7 connected world where people work all different kinds of hours.
Gone are the days of working 9-5 and leaving all your work behind. Every employee or contractor you have should be able to receive an answer to any question when they need it.
If they have to sit around and wait for you to come back into the office in the morning, it’s creating a bottleneck, slowing down your process, and ultimately costing you money.
5. MLOps Makes Deployment and Implementation Easier
MLOps’ ability to improve communication, create processes, and automate things can make deployment and implementation easier because of the inherently reduced chances of errors.
With MLOps at their fingertips, developers can pack models much faster while still maintaining quality control with profiling and model validation.
It provides a way for data scientists and administrators to perform at a higher level with confidence in knowing each step was followed and validated for consistency.
What is the Future of MLOps in Business and Marketing?
MLOps is a new but colossal industry expected to hit $4 billion by 2025. The most significant impact it may have relates to how we manage data.
Data is meaningless if you don’t have an understandable way to translate it.
Machine learning operations allow you to take that data and turn it into something tangible. For example, if you made some changes to a specific business model and you notice worsening results after six months, you may want to circle back to the original model.
Plus, MLOps provides consistency. Producing a consistent product is a tall order because each scenario is different, and you’ll likely run into unique issues each time. Businesses all over the world struggle to put out a consistent product/service time and time again.
MLOps helps data scientists and operations managers work together to produce consistent results across a considerable time frame. As the project moves from one end of the pipeline to another, all the people involved need to have a way to ensure quality is maintained. MLOps can even automate the process of quality assurance with routine scans.
Conclusion
MLOps helps create lines of communication between everyone involved in the process of developing machine learning technology. As marketers, we can learn something from this and implement the same principles in our businesses.
Every business can benefit from clear guidelines and processes to follow. If you’re experiencing bottlenecks, slow production times, and a large number of errors, you might want to pull back the curtain and take a look at your procedures as a whole.
If you have bad credit, it can be hard to find small business loans regardless of gender. If you are a female business owner, with bad credit, it may help to look for lenders that offer certain types of loans, rather than small business loans for women with bad credit specifically.
What’s Best As Far as Small Business Loans for Women With Bad Credit
There are certain types of funding that work well for all business owners with bad credit, including women.
Small Business Loans for Women with Bad Credit: Credit Line Hybrid
The credit line hybrid is unsecured business financing. It is available to pretty much anyone for any type of business expense. You can use it for real estate, equipment, working capital, and even startup expenses. Not only that, but there is no security required. Furthermore, there is no down payment, and you do not have to provide income documentation. It is completely no-doc financing.
Now, you do have to have strong personal credit. A credit score of 680+ is necessary. Also, there cannot be any late payments in the past 12 months, there can be no open collections or bankruptcies, and there should be less than 4 inquiries in the past 6 months on your consumer credit report. There also has to be at least 2 open credit cards with a $2,000 limit or higher with 2 years of good payment history.
Where does the part about bad credit come into play? Here it is. If you do not meet these requirements, you can take on a credit partner that does meet them. The payments will still be reported on the business’s credit report, so business credit will build whether you get the financing yourself or through a credit partner.
The best part is, amounts can range up to $150,000, and often interest rates are as low as 0% for the first 6 to 18 months.
Find out why so many companies use our proven methods to get business loans.
Small Business Loans for Women with Bad Credit: Business Revenue Lending
If your business has consistent revenue of $120,000 per year or more, you may qualify for this type of funding. Lenders verify revenue using bank statements. There can be no recent bankruptcies, but the minimum credit score to qualify is as low as 500.
A business must also be in operation for a year or more, and they must do over 5 small transactions each month to get business revenue financing.
Small Business Loans for Women with Bad Credit: Merchant Cash Advance
If your business accepts credit card payments and you have at least a 500 FICO, you could get up to $750,000 in a merchant cash advance. Credit rates are usually lower compared to traditional financing as well.
Your business must bring in $100,000 or more per year in credit card sales, and typically you can get approval equal to one months credit card financing volume.
Small Business Loans for Women with Bad Credit: Account Receivable Financing
Outstanding account receivables can also be a source of funding for your business. Get as much as 80% of receivables advanced in less than 24 hours. You get the rest of the accounts receivable amount once you collect full payment for the invoice. Closing takes 2 weeks or less.
Receivables should be with the government or another business. Getting financing with receivables from individuals is not as easy. If you also have purchase orders, then you can get financing to have those filled. You won’t need to use your cash flow to do so.
Small Business Loans for Women with Bad Credit: Equipment Financing
You can secure this type of financing by using existing equipment or new equipment you want to purchase as collateral. Funding is available up to $10 million. Terms range from 5 to 60 months, and you need a minimum 550 FICO.
The equipment must be new, and most types of equipment are acceptable, including software.
You’ll need to provide details on the equipment to be financed and, depending on the loan amount and certain risk factors, you may need to show 2 years corporate and personal tax returns.
Find out why so many companies use our proven methods to get business loans.
Small Business Loans for Women with Bad Credit: Enterprise SBA Loans
For these loans you have to have collateral worth up to at least 50% of the loan amount, but you only need a FICO of 620. There also can be no bankruptcies in the past 4 years. Only for profit companies qualify, and they must have positive trends in sales growth. Generally amounts are available of up to $12 million with terms up to 25-years.
Small Business Loans for Women with Bad Credit: Real Estate Financing
Likewise, you probably will not be financing real estate with business credit cards, even if it is 0 interest. You can get real estate financing in amounts up to $10 million with terms from 6 to 60 months and interest rates as low as 6%. You will need a 500 minimum credit score, and there are a few other requirements.
How to Decide Which Option is Best for You
If you are looking for business loans for women with bad credit, it’s fair to say you aren’t that confident in your credit score. A business credit expert can help you not only determine which of these options is best for your business, but also help you build fundability so you don’t have to worry about finding funding for your business. If your business is fundable, you can get all the business financing you will ever need.
Grants for Women Business Owners
One area where you will find funding specifically for women, and credit isn’t an issue, it grants.
Find out why so many companies use our proven methods to get business loans.
SBA Women’s Business Centers
In addition to helping with loans, the SBA Women’s Business Centers also help women entrepreneurs get access to other types of funding. Some lend money or award grants directly, while others help connect women entrepreneurs with financial institutions. Take a look at their website to find out more on how to apply for women owned business grants through this network.
Eileen Fisher Women Owned Business Grants
The clothing brand Eileen Fisher hands out $100,000 per year to 10 women-owned businesses. To qualify, a woman must have at least 51% ownership, and the business must be in operation for at least three years. Also, it must bring in less than $1 million per year in revenue and have a focus on environmental or social change.
Amber Grant
The Amber Grant awards $500 to $1,000 per month to a woman-owned business. One of the recipients also receives an additional $10,000 grant at the end of the year. Applicants only need to tell their story and turn it in with a $15 application fee.
#GIRLBOSS Foundation Grant
Specifically for woman-owned businesses in fashion, music, and art, the #GIRLBOSS small business grant awards $15,000. They also offer exposure via the Girlboss website and social media platforms. Judges rate those applying on creativity, business savvy, planning, innovation in the field, need, and where they plan to work.
Cartier Women’s Initiative Award
The Cartier Women’s Initiative Awardis $100,000 for first place and $30,000 for second place. They award the grant to 18 female business owners from around the world each year. Women business owners who are just getting started may qualify.
Business Loans For Women With Bad Credit Do Exist
They really do. They just aren’t necessarily for women exclusively. Still, if you find something that will work with bad credit, you’ve found gold. It’s even better if it can be used to build business credit at the same time.
It does no good to find funding for bad credit once. You need to work on the bad credit so you can eventually get the best terms and rates. This is where a business credit expert can be exceptionally helpful.
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There’s a constant war between growing a business and keeping an operation lean, mean, and agile.
How does a company stay efficient, even as they are trying new things and bringing on employees?
It’s actually quite simple: business process management (BPM) software. Rarely are answers this easy.
BPM software helps organizations of all sizes streamline operations and minimize waste.
Visualize every process from end to end. Find opportunities for efficiency and automation. Get more done with fewer mistakes.
If optimizing your business processes sounds like a good idea, this post will tell you everything you need to know about how to find the perfect BPM software for you.
The Top 5 Options for Business Process Management Software
How to Choose the Best Business Process Management Software for You
These tools are supposed to make life easier, right?
Yes. 100 percent.
And not just you, but your employees, customers, and potential clients, too.
Any organization can benefit from implementing BPM software. Because of their broad usefulness, these products come in a lot of shapes and sizes.
Thankfully, you can break your search down into three essential goals.
You are looking for BPM software that will help you:
Clearly visualize business processes
Automate more business processes
Monitor and improve business processes
Design. Run. Automate. Improve. Repeat.
Once you get set up, it will be that simple.
Figure out which features you need by considering each product in light of how it will help you visualize, automate, and monitor the daily work of your business.
Process Visualization
The first responsibility of BPM software is to help companies define and document their business processes.
These platforms have a visual workflow builder that lets you map out every step of every process from start to finish.
Missing steps and redundancies are plain as day. If there’s a breakdown in the billing process, for example, it will be easy to understand and address with BPM software. There’s a clear picture of how the paperwork is moving (or not) from start to finish.
This is way better than finding out there’s an issue from a confused or angry customer. By providing a full, end-to-end visualization of the process, BPM software is really helpful for diagnosing and treating common symptoms of business inefficiency.
What’s really nice is that you can quickly modify workflows without writing code.
Check out the drag-and-drop workflow builder in Orchestly, where you can see how each stage and transition can be easily defined:
Each product does it a little differently. It’s a good idea to watch their videos to see what the UI is like. This will give you a base-level sense of how each BPM software thinks about process management.
If you are a fan of the flow chart style, Orchestly is going to work well. Tallyfy wants to get away from flow charts and works off what they call a blueprint. Pipefy is designed to work best in board-based and Kanban settings.
Which one looks like it’s swimming in your current?
Process Automation
As elegant and useful as the visualization aspects of BPM software are, the process automation is where you’re going to see the major impact on your operations.
With workflows represented in a clear fashion, you can identify different points and transitions where you can add automation.
In the Pipefy workflow builder, for example, you can make it so one action triggers another. There’s no code to write, just select the option that pushes the workflow along.
This can take an incredible amount of busywork out of people’s day-to-day. A sales rep completes their proposal and it’s automatically routed to the right manager for review and approval.
Not only is that rep moving on to their next task, the pending approval is queued up exactly where it needs to be for the manager.
Nothing gets missed or held up.
BPM software is great at automating routine and recurring processes like:
Requests for approval
Inventory updates
Time-off requests
Promotions
Customer onboarding
Training new hires
There’s really no limit to the applications. You can implement uniform policies, keep everyone informed, and ensure that every last lowercase j is dotted.
With regards to automation, you want to choose BPM software that strikes an appropriate balance in your workspace. Something sophisticated enough to handle the job that is still within your IT wheelhouse.
The big edge that the code-heavy platforms have is that they can be 100% customized to fit your situation.
The upshot to the no-code platforms is that non-technical users are going to be up and running in no time. They won’t need help to build out and adjust workflows. This kind of independence is really important, and shouldn’t be sacrificed lightly in favor of a more comprehensive tool.
Process Monitoring
What if you never had to send another “Hey, how’s it going?” email?
With BPM software, you can monitor your processes in real-time without ever having to bug someone again. No one does.
Users see exactly where they are on all their tasks. Dates and deadlines are clear, and everything they need to do is laid out in front of them.
Supervisors have total visibility of all projects and jobs. With workflows feeding information into dashboards, managers have a clear view of KPIs and bottlenecks can be seen—and avoided—well in advance.
Leadership can leverage your BPM platform to track tons of useful data for measuring productivity, forecasting costs, and further refining processes.
Another nice feature of good BPM software are the collaborative tools that help teams stay on track.
These aren’t monitoring tools per se, but the ability to comment, @mention, or flag tasks may serve as a critical early warning system.
The Different Types of Business Process Management Software
BPM Software can do a whole lot on its own or it can act as a guide.The type of BPM software you need depends on your goals—visualization, monitoring, and automation—and how complex your desired workflows are.
In some ways, you can think of these four different types of BPM software as a stack that grows increasingly robust:
Let’s go in-depth on each type to build a firm sense of how these capabilities help companies respond to different challenges.
Business Process Modeling Software
When you see business process modeling software, think of it as a BPM solution that helps with the visualization side of process management.
These tools produce clear documentation, SOPs, and visual representations of workflows that can easily be shared throughout the company.
This is crucial for maintaining consistency of business operations and a boon to new hires who can understand exactly where they fit in.
Workflow Management Software
The next step up in functionality is workflow management software. With this type of BPM software, individuals and teams can interact with the workflows.
They can mark assignments as done, ask questions about specific tasks, and get all the information they need in one centralized location.
Workflow management solutions have a blend of visualization and monitoring capabilities that are really great for keeping everyone on track.
Workflow Automation Software
BPM software that fits in this category will let you automate repetitive tasks within workflows. Set rules that automatically route tasks, files, data to the right person or team.
Say a customer fills out a form, for instance. This could trigger a welcome email series and automatically route their contact info to the appropriate rep.
That’s a simple example, and you can set rules that automate as many steps as you like throughout the customer lifecycle.
These tools tend to connect to a variety of data sources and work well across the organization. Often they come with pre-built workflows and templates for HR, accounting, sales, and so on.
Scope out the solutions on the vendor website to see examples of who’s having success with each product. Are these markets and use-cases that apply to your business?
In terms of automation capabilities, the simpler, lighter workflow automation tools can do a lot. The more expensive premium tools can do a lot more.
I know that’s an oversimplification, but in the end, the “power” of BPM software lies in how well a team can use it. The heavyweight automation features included with premium products are amazing, no doubt, but they take some time to master.
Low-Code Application Development
Low-code application development platforms weren’t built for BPM, but they are growing in popularity as a solution.
Low-code application development platforms allow novice developers the ability to whip up custom applications that meet unique business needs. Really, anyone who puts the time in can figure out how to use these intuitive platforms with little to no coding.
Why is this important for BPM?.
The thing is, at a certain point, super-complex workflows can get unmanageable. There’s no one straw that breaks the camel’s back, but if your average user is having to reach out to IT to sort out problems with their daily work, there’s probably an issue.
Low-code application development comes at the problem from a different angle. Instead of deploying a system and trying to fit it to your needs, why not build a system that’s specific to your organization?
These tools connect with third-party SaaS apps, so you can build out really rich workflows that leverage information from the tools you already use.
It’s a different approach to the same problem as traditional BPM software. If your teams are comfortable with a low-code solution, I’d go for it. They’re really affordable and have few hard limits in terms of what you can do.
#1 – Orchestly — Best for Simple Workflow Automation
Orchestly is built to optimize your everyday business processes.
Say you want to hire a new worker, file an expense report, or request new content. Maybe the marketing department wants a killer post about the best business process management software.
In each case, there are several steps of validation and review that need to be baked into each process. With Orchestly’s visual workflow editor, literally anyone can build out the exact steps required.
Here’s an example of an onboarding workflow in Orchestly.
Each step in the series of tasks is clearly defined in a series of stages (white boxes), connected by transitions (turquoise boxes), and parallel transitions (orange boxes). Drill down into each stage to the set of conditions that need to be followed before, during, and after any transition.
This is a super easy interface to master.
There are tons of pre-built templates and, once users want to fine-tune their own scenarios, all of the visualization and basic automation is managed with an intuitive drag-and-drop editor.
Another really nice thing about Orchestly are the monitoring features. There are a host of ready-made report types that give you deep insight into your processes.
You can drill down into transitions to discover how many requests are at a particular stage, the ratio of approvals to rejections, and other metrics. Plus, you can filter search results to get a real time picture of specific employees, projects, or customers.
Orchestly comes with other features that help you extend BPM functionality throughout your organization:
Role-based access control
Request manager
Form designer
Audit log
Email templates
APIs, extensions, and webhooks
Orchestly offers a free version that is limited to five users and three orchestrations (their word for workflow). The paid version, Orchestly Business, is $7/month per user with an annual subscription.
You can try Orchestly Business free for 15 days. If you have never given BPM software a shot, this is a great, low-risk option to start out.
#2 – Pipefy — Best BPM Software for Kanban
Pipefy is winning over a lot of people because of its approachable style. For companies that are already managing processes within a Kanban framework, Pipefy is going to fit like a missing puzzle piece.
This platform has the feel and flexibility of an agile project management tool, yet you’ve got the power of BPM software.
Switch between calendar, list, and Kanban views. Yes it looks like Trello, but in Pipefy you can use the drag-and-drop editor to add rules, custom fields, and ensure that everyone assigned to the process knows exactly what’s necessary to keep things moving.
Build out completely custom workflows with Pipefy’s easy editor. There are hundreds of plug-and-play process templates available in its free gallery.
What’s really helpful for marketing and sales is that you can design these workflows to kick off as soon as someone fills out a form, or reaches out by phone, email or SMS.
They’ve really made it as easy as possible for people to configure their workflows without writing a line of code.
Intuitive doesn’t even begin to describe how helpful Pipefy is for first-time users. It’s always suggesting the next step.
Plus, your customers and clients can create and track requests without being a Pipefy user, which is great for collaboration with clients and other stakeholders.
Other helpful features include:
Reporting dashboards
Native integration with Slack and GitHub
API access
Self-service portals and forms
SLA and deadline tracking
Pipefy offers a free trial of their paid plans and a free version for up to five people. To really take advantage of this awesome tool, I recommend one of the paid plans:
Business: $18/month per user
Enterprise: $30/month per user
Unlimited: contact sales
If you like the idea of moving cards through a pipeline, this is a great product. You can start small and gradually automate every one of your processes with Pipefy.
Easy to build, easy to adjust, Pipefy is perfect for the continuously improving agile workflow. If your teams are happy running Kanban, look no further than Pipefy.
#3 – Creatio Studio — Best Low-Code Solution
Creatio Studio gives you the best of both worlds in terms of power and learning curve. Non-technical users will find the platform just about as easy to use as any popular BPM software, but there’s no ceiling to what they can do if they are willing to learn.
The free version of Creatio Studio works for business process modeling, allowing teams to diagram workflows in a collaborative setting. View, comment, and edit the designs in real time, and save everything to a process library for easy access.
To manage, monitor, and automate processes, you’ll need the Creatio Studio Enterprise. With it, you can design workflows and business applications of any complexity.
Think of building with blocks rather than writing code. Creatio compares it to building with LEGO—you don’t have to make the parts so much as select what you want and snap it together.
There are hundreds of ready-to-use templates in the Creatio marketplace to help you get started. As you design and refine processes within the visual design builder, Creatio automatically generates the corresponding business logic.
It’s a great product that straddles the divide between technical and non-technical users. Creatio is constantly suggesting actions and helping users double-check their work.
In addition to helping people design exactly what they need, Creatio Studio comes with:
Role-based access control
Interactive dashboards
API access
No-code data migration
One-click pdf documentation
AI and machine learning tools
Creatio Studio is free for an unlimited number of users and Creatio Studio Enterprise starts at $25/month per user.
Shortlist the free version of Creatio if you are just starting to think about business process management. It will help you get off on the right foot at no cost.
If, on the other hand, you are hitting the limits of your current BPM software, Creatio Studio Enterprise is one of the most capable, affordable options available.
Although many low-code platforms are built for general use, Creatio was originally founded as bpm’online in 2011. Every aspect of the design has BPM in mind, which lowers the learning curve tremendously for non-IT users.
#4 – Tallyfy — Best for Automating Recurring Processes
Tallyfy gets away from the idea of flowcharts. Instead of shapes and arrows to guide your design process, Tallyfy keeps everything in something they call a blueprint.
There are pre-made blueprints you can use for marketing, finance, sales, HR, and more. Once you have designed a blueprint, you can use it over and over again.
In the example below, you can see a blueprint that captures the entire onboarding journey.
Blueprints are easy to customize without code. Point and click to add new tasks to blueprints. Within tasks, you can set required fields and add drop down menus that will pull the names of employees, customers, and projects from connected databases.
When you go to launch these blueprints, end-users love how easy it is to complete each task.
Managers can view progress at a glance or drill down into specific tasks. Clients who need to approve a request or sign off at a particular step will just see that.
Working off blueprints, it’s incredibly easy to set up and automate recurring processes. Quickly create a library of blueprints that suit your needs, and continuously improve each step. Turn all of your recurring processes into error-free workflows that save time and eliminate stress.
After launching your automated processes, Tallyfy’s process monitoring capabilities help you keep track of all your flows in real time. Some of the highlights include:
Powerful search and filtering
Custom process views
Role-based access control
Audit trails
Commenting
Issue flagging
Having commenting and issue flagging as separate features is so important for surfacing problems quickly.
How many times does a red alert get buried for a few hours among the constant flow of @mentions and comments? With easy opportunities to flag problems, companies never let an employee, client, or goal fall through the cracks again.
You get two months of Tallyfy free if you sign an annual contract for any of their three pricing tiers:
Tallyfy Docs: starting at $42/month, includes 10 members
Tallyfy Basic: starting at $100/month, includes 8 members
Tallyfy Pro: starting at $100/month, includes 4 members
The way their tiers break down is really easy, though it looks a little unusual at first. Docs lets you create read-only blueprints, Basic lets you launch blueprints as a process, and Pro lets you add automation.
If you need additional users, the added cost increases at each tier, from $4/user with Docs, to $12.50 with Basic, and $25 with Pro.
They offer a free 14-day trial, if you want to see what Tallyfy is all about. I really recommend the blueprint-style BPM software to any business that has repetitive tasks they need to get right every time.
#5 – Zoho Creator — Best for Customizable Workflows
Zoho Creator is a low-code application development platform that can be used to create a wide range of customizable business process workflows.
Unlike Creatio Studio, Zoho Creator wasn’t born as a BPM tool. Think of it as a blank slate with an intuitive toolkit that allows companies to create everything from serverless apps to full-blown, totally specialized ERP software.
The reason companies are finding success with Zoho Creator in the BPM space is that it comes loaded with tools to build out customized workflows.
Between the templates and the drag-and-drop platform, everyone with a few weeks of Zoho Creator under their belt will think they’re a developer.
There’s nothing dazzling about the UI, but it’s easily navigable and you can build out really sophisticated apps to automate your business processes.
Zoho is really great at guiding users through each step, whether they are trying to set up a simple payment process, or design a mobile app for their office.
To really handle the complex tasks, users will have to familiarize themselves with Zoho’s proprietary language, Deluge, which is short for Data Enriched Language for the Universal Grid Environment.
It’s a mouthful to say, but in terms of building out custom scripts quickly, Deluge is a huge step in the right direction.An HR manager with no code experience will be able to automate a recruitment application. A sales rep can build a system to track leads automatically using Deluge.
With other platforms, end-users are at the mercy of their automated workflows and have little ability to make changes to the system. With Zoho, they can keep control and ensure that their workflows are designed according to best practices and current challenges.
For their part, technically gifted users will love Zoho Creator because they can add logic and function to their applications without having to wrestle with conventional tools.
Some of the other features that help you get off the ground quickly include:
50 ready-to-use apps
Schema builder
Developer sandbox
Payment gateway integration
Audit trail
Automated application backup
Pricing is remarkable, considering how powerful the platform is.
Basic: $10/month per user
Premium: $20/month per user
Ultimate: $35/month per user
The Basic tier is quite robust, though you are limited to building 3 apps. You get more apps and greater functionality at the Premium and Ultimate tiers.
You can certainly manage simple workflows with Zoho Creator, but I wouldn’t make this your first pick for that reason. It’s just too powerful to justify using when you have Orchestly and Pipefy available.
Choose Zoho Creator if lighter tools aren’t meeting your BPM needs.
Summary
There is no reason to fly blind. Get immediate insight and oversight of all your business processes with an appropriate BPM solution.
If you are just starting out, I really recommend Orchestly for and Tallyfy.
If you have simple automation and workflow goals, go with Orchestly and see how far it gets you. For many companies, it’s going to be enough to better manage all of their operations.
Tallyfy is going to knock out repetitive tasks really quickly with the workflow automation tools. Blueprint your processes and then manage them with little oversight.
For agile teams, especially those working within a Kanban or Scrum process framework, I would definitely check out Pipefy. It’s built for agility. Make adjustments on the fly and monitor performance to continually evolve better processes.
Between Creatio Studio and Zoho Creator, the two low-code options on this list of best BPM software, the choice ultimately comes down to what your users like.
Judging from reviews, lots of new users are falling in love with Zoho’s Deluge scripting language. If that’s the case, you may want to consider implementing Creator and other products from Zoho, like their CRM, which also rely on Deluge.
If someone is looking for a more traditional take on highly-customizable BPM software, I’d point you to Creatio Studio.
Thinking of throwing in the towel, as it looks like the US slides further and further into a recession? Don’t! This can be a great time to regroup and get your business set up for even more success down the line. Building business credit should be on your to-do list. So, find out the best way to build business credit in a recession.
Learn the Best Way to Build Business Credit in a Recession
We can show you the best way to build business credit in a recession! Get the kind of business funding that can take your business to new heights! And it can happen no matter what goes on with the economy.
Economic Downturns and Company Funding
The United States’s economy has been through any variety of changes throughout the years. Our financial fortunes can depend upon developments in technology, diplomatic ties (or cutting those ties), the weather, and also more. Business credit, fortunately, is an asset which you can develop even during financial slumps. Nonetheless, you may need to get a little creative with it, and with various other forms of business funding.
The Best Way to Build Business Credit in a Recession – But What’s Business Credit, Anyway?
Small business credit is credit in a business’s name. It doesn’t link to a business owner’s personal credit, not even if the owner is a sole proprietor and the sole employee of the small business.
Accordingly, a business owner’s business and individual credit scores can be very different.
The Benefits
Because business credit is distinct from consumer, it helps to secure a business owner’s personal assets, in the event of a lawsuit or business bankruptcy.
Also, with two separate credit scores, a business owner can get two different cards from the same merchant. This effectively doubles buying power.
Another benefit is that even start-ups can do this. Heading to a bank for a business loan can be a recipe for frustration. But building company credit, when done the right way, is a plan for success.
Individual credit scores rely on payments but also various other factors like credit usage percentages.
But for company credit, the scores actually just hinge on whether a company pays its debts on a timely basis.
The Best Way to Build Business Credit in a Recession – The Process
Building business credit is a process, and it does not occur automatically. A business will need to actively work to build company credit.
Nonetheless, it can be done easily and quickly, and it is much speedier than building consumer credit scores.
Merchants are a big aspect of this process.
Undertaking the steps out of order will lead to repetitive rejections. Nobody can start at the top with business credit. For example, you can’t start with retail or cash credit from your bank. If you do, you’ll get a denial 100% of the time.
The Best Way to Build Business Credit in a Recession – Enhancing Company Fundability
A company must be fundable to credit issuers and vendors.
Therefore, a company will need a professional-looking web site and email address. And it needs to have site hosting bought from a vendor like GoDaddy.
Also, business telephone numbers must have a listing on ListYourself.net.
Also, the business telephone number should be toll-free (800 exchange or comparable).
A business will also need a bank account dedicated strictly to it, and it needs to have all of the licenses essential for operation.
Licenses
These licenses all have to be in the exact, appropriate name of the company. And they need to have the same business address and telephone numbers.
So bear in mind, that this means not just state licenses, but possibly also city licenses.
The Best Way to Build Business Credit in a Recession – Working with the IRS
Visit the Internal Revenue Service website and get an EIN for the company. They’re free of charge. Select a business entity such as corporation, LLC, etc.
A company may begin as a sole proprietor. But they absolutely need to change to a type of corporation or an LLC.
This is to limit risk. And it will make the most of tax benefits.
A business entity matters when it concerns tax obligations and liability in case of a lawsuit. A sole proprietorship means the owner is it when it comes to liability and taxes. Nobody else is responsible.
The best thing to do is to incorporate. You should only look at a DBA as an interim step on the way to incorporation.
The Best Way to Build Business Credit in a Recession – Starting Off the Business Credit Reporting Process
Begin at the D&B website and obtain a cost-free D-U-N-S number. A D-U-N-S number is how D&B gets a small business into their system, to produce a PAYDEX score. If there is no D-U-N-S number, then there is no record and no PAYDEX score.
Once in D&B’s system, search Equifax and Experian’s web sites for the business. You can do this at www.creditsuite.com/reports. If there is a record with them, check it for correctness and completeness. If there are no records with them, go to the next step in the process.
By doing this, Experian and Equifax will have something to report on.
Starter Vendor Credit
First you should establish tradelines that report. Then you’ll have an established credit profile, and you’ll get a business credit score.
And with an established business credit profile and score you can start to get credit for numerous purposes, and from all sorts of places.
These kinds of accounts have the tendency to be for things bought all the time, like marketing materials, shipping boxes, outdoor workwear, ink and toner, and office furniture.
But first off, what is trade credit? These trade lines are credit issuers who give you starter credit when you have none now. Terms are usually Net 30, instead of revolving.
Therefore, if you get an approval for $1,000 in vendor credit and use all of it, you need to pay that money back in a set term, like within 30 days on a Net 30 account.
Details
Net 30 accounts have to be paid in full within 30 days. 60 accounts have to be paid in full within 60 days. Unlike revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you used.
To launch your business credit profile the right way, you should get approval for vendor accounts that report to the business credit reporting bureaus. As soon as that’s done, you can then make use of the credit.
Then repay what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.
Vendor Credit – It Makes Sense
Not every vendor can help in the same way true starter credit can. These are vendors that grant approval with very little effort. You also want them to be reporting to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.
Uline is a true starter vendor. You can find them online at www.uline.com. They sell shipping, packing, and industrial supplies, and they report to Dun & Bradstreet and Experian. You MUST have a D-U-N-S number and an EIN before starting with them. They will ask for your business bank information. Your company address must be uniform everywhere. You need for an order to be $50 or more before they’ll report it. Your first few orders may need to be prepaid initially so your company can get approval for Net 30 terms.
How to apply with them:
Add an item to your shopping cart
Go to checkout
Select to Open an Account
Select to be invoiced
Quill
Quill is another true starter vendor. You can find them online at www.quill.com. They sell office, packaging, and cleaning supplies. And they also sell toner, office furniture, and even shipping and school supplies. They report to Dun and Bradstreet every quarter.
To apply, you MUST have a D&B PAYDEX score. If not given a Net 30 they will ask you to do prepaid orders of $100.00. Normally any prepaid order won’t report but you would need them to have given you a Net 30 account. Net 30 accounts require $50.00 purchase to report.
New business or businesses with no credit history may need to prepay purchases until Net 30 approval. Terms are Net 30.
Here’s how to qualify:
Your business entity must be in good standing with the applicable Secretary of State
You must have an EIN and a D-U-N-S number
Business address (it has to match everywhere)
Business license (if applicable)
A corporate bank account
Apply online or over the phone.
Grainger Industrial Supply
Grainger Industrial Supply is also a true starter vendor. You can find them online at www.grainger.com. They sell hardware, power tools, pumps and more. They also do fleet maintenance. And they report to D&B. You need a business license, EIN, and a D-U-N-S number.
To qualify, you need the following:
A business license (if applicable)
An EIN number
A business address matching everywhere
A corporate bank account
A D-U-N-S number from Dun & Bradstreet
Your corporate entity must be in good standing with the applicable Secretary of State. If your company does not have established credit, they will require additional documents. So, these are items like accounts payable, income statement, balance sheets, and the like.
Apply online or over the phone.
The Best Way to Build Business Credit in a Recession – Accounts That Do Not Report
Non-reporting trade accounts can also be helpful. While you do want trade accounts to report to a minimum of one of the CRAs, a trade account which does not report can still be of some worth.
You can always ask non-reporting accounts for trade references. Additionally, credit accounts of any sort should help you to better even out business expenses, consequently making budgeting less complicated.
Store Credit
Store credit comes from a variety of retail companies.
You must use your Social Security Number and date of birth on these applications for verification purposes. For credit checks and guarantees, use the small business’s EIN on these credit applications.
Fleet Credit
Fleet credit is from companies where you can buy fuel, and fix and maintain vehicles. You must use your Social Security Number and date of birth on these applications for verification purposes. For credit checks and guarantees, make sure to apply using the business’s EIN.
These are businesses such as Visa and MasterCard. You must use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, use your EIN instead.
The Best Way to Build Business Credit in a Recession – Monitor Your Business Credit
Know what is happening with your credit. Make certain it is being reported and deal with any inaccuracies ASAP. Get in the habit of taking a look at credit reports and digging into the specifics, and not just the scores.
The Best Way to Build Business Credit in a Recession – Fix Your Business Credit
So, what’s all this monitoring for? It’s to challenge any inaccuracies in your records. Mistakes in your credit report(s) can be taken care of. But the CRAs normally want you to dispute in a particular way.
Disputing credit report inaccuracies generally means you mail a paper letter with duplicates of any proof of payment with it. These are documents like receipts and cancelled checks. Never mail the original copies. Always send copies and keep the original copies.
Fixing credit report inaccuracies also means you precisely itemize any charges you dispute. Make your dispute letter as clear as possible. Be specific about the concerns with your report. Use certified mail so that you will have proof that you mailed in your dispute.
The Best Way to Build Business Credit in a Recession – A Word about Building Business Credit
Always use credit smartly! Don’t borrow more than what you can pay off. Monitor balances and deadlines for payments. Paying promptly and in full will do more to raise business credit scores than nearly anything else.
Building company credit pays. Good business credit scores help a small business get loans. Your credit issuer knows the small business can pay its financial obligations. They recognize the small business is bona fide.
The business’s EIN links to high scores and lenders won’t feel the need to ask for a personal guarantee.
The Best Way to Build Business Credit in a Recession – Takeaways
Business credit is an asset which can help your company for many years to come. The recession will not last forever.
Can you get the recession-proof best business credit cards with no annual fee? Absolutely! No matter what the economy is doing, you can get cards just like these.
You Need the Recession-Proof Best Business Credit Cards with No Annual Fee
Are you looking for the recession-proof best business credit cards with no annual fee?
According to the SBA, business credit card limits are 10 – 100 times those of personal cards! This means you can get a lot more cash with company credit.
And this also means you can have personal credit cards at shops, and now have an alternate card at the same retail stores for your company. And you will not have to put up collateral, cash flow, or financial information to get small business credit.
The Recession-Proof Best Business Credit Cards with No Annual Fee – Benefits
Features vary, so be sure to select the benefit you prefer from this array of alternatives.
The Recession-Proof Best Business Credit Cards with No Annual Fee
No Yearly Fee/Flat Rate Cash Back
Ink Business Unlimited℠ Credit Card
Check out the Ink Business Unlimited℠ Credit Card. Beyond no annual fee, get an introductory 0% APR for the initial one year. Afterwards, the APR is a variable 14.74 – 20.74%.
You can get unlimited 1.5% Cash Back rewards on every purchase made for your corporation. And get $500 bonus cash back after spending $3,000 in the initial three months from account opening. You can redeem your rewards for cash back, gift cards, travel and more using Chase Ultimate Rewards®. You will need excellent credit scores to get this card.
Irresistible Cards for Jackpot Rewards That Never Expire
Capital One® Spark® Cash Select for Business
Have a look at the Capital One® Spark® Cash Select for Business. It has no yearly fee. You can get 1.5% cash back on every purchase. There is no limit on the cash back you can earn. Also get a one-time $200 cash bonus once you spend $3,000 on purchases in the first 3 months. Rewards never expire.
Pay a 0% introductory APR for 9 months. Then pay 14.49% – 22.49% variable APR afterwards.
You will need good to excellent credit scores to qualify.
An Alternative to the Recession-Proof Best Business Credit Cards with No Annual Fee: Dependable Credit Cards for Fair to Poor Credit, Not Calling for a Personal Guarantee
Brex Card for Startups
Check out the Brex Card for Startups. It has no yearly fee.
You will not need to provide your Social Security number to apply. And you will not need to provide a personal guarantee. They will take your EIN.
Nonetheless, they do not accept every industry.
Additionally, there are some industries they will not work with, as well as others where they want added documentation. For a list, go here: https://brex.com/legal/prohibited_activities/.
To determine creditworthiness, Brex checks a corporation’s cash balance, spending patterns, and investors.
You can get 7x points on rideshare. Get 4x on Brex Travel. Also, get triple points on restaurants. And get double points on recurring software payments. Get 1x points on everything else.
You can have bad credit scores (even a 300 FICO) to qualify.
Check out the Capital One® Spark® Cash for Business. It has an introductory $0 yearly fee for the first year. Afterwards, this card costs $95 each year. There is no introductory APR offer. The regular APR is a variable 18.49%.
You can get a $500 one-time cash bonus after spending $4,000 in the first 3 months from account opening. Get unlimited 2% cash back. Redeem at any time without minimums.
You will need great to outstanding credit to qualify.
Take a look at the Discover it® Business Card. It has no annual fee. There is an introductory APR of 0% on purchases for 12 months. After that the regular APR is a variable 14.49 – 22.49%.
Get unlimited 1.5% cash back on all purchases, with no category restrictions or bonuses. They double the 1.5% Cashback Match™ at the end of the first year. There is no minimum spend requirement.
You can download transactions| quickly to Quicken, QuickBooks, and Excel. Keep in mind: you will need great to exceptional credit scores to get approval for this card.
Check out the Ink Business Cash℠ Credit Card. It has no annual fee. There is a 0% introductory APR for the first year. Afterwards, the APR is a variable 14.74 – 20.74%. You can get a $500 one-time cash bonus after spending $3,000 in the first 3 months from account opening.
You can earn 5% cash back on the initial $25,000 spent in combined purchases at office supply stores and on web, cable, and phone services each account anniversary year.
Get 2% cash back on the initial $25,000 spent in combined purchases at filling stations and restaurants each account anniversary year. Earn 1% cash back on all other purchases. There is no restriction to the amount you can get.
You will need outstanding credit to get this card.
Bank of America® Business Advantage Cash Rewards MasterCard® credit card
Take a look at the Bank of America® Business Advantage Cash Rewards MasterCard® credit card. Get an 0% introductory APR for the initial 9 billing cycles of the account. Afterwards, the APR is 13.74% – 23.74% variable. There is no yearly fee. You can get a $300 statement credit offer.
Get 3% cash back in the category of your choice. So these are gas stations (default), office supply stores, travel, TV/telecom & wireless, computer services or business consulting services. Earn 2% cash back on dining. So this is for the initial $50,000 in combined choice category/dining purchases each calendar year. After that earn 1% after, with no limits.
An Alternative to the Recession-Proof Best Business Credit Cards with No Annual Fee: Secure Business Credit Cards for Average Credit
Capital One® Spark® Classic for Business
Check out the Capital One® Spark® Classic for Business. It has no annual fee. There is no introductory APR offer. The regular APR is a variable 24.49%. You can get unlimited 1% cash back on every purchase for your company, without minimum to redeem.
While this card is within reach if you have average credit scores, beware of the APR. But if you can pay in a timely manner, and completely, then it’s a good deal.
Flexible Financing Credit Cards – Have A Look at Your Options!
The Plum Card® from American Express
Take a look at the Plum Card® from American Express. It has an introductory annual fee of $0 for the first year. After that, pay $250 each year.
Get a 1.5% early pay discount cash back bonus when you pay within 10 days. You can take up to 60 days to pay without interest when you pay the minimum due by the payment due date.
You will need great to excellent credit to qualify.
An Alternative to the Recession-Proof Best Business Credit Cards with No Annual Fee: Company Credit Cards with a 0% Introductory APR – Pay Zero!
Blue Business® Plus Credit Card from American Express
Take a look at the Blue Business® Plus Credit Card from American Express. It has no yearly fee. There is a 0% introductory APR for the first twelve months. Afterwards, the APR is a variable 14.74 – 20.74%.
Get double Membership Rewards® points on everyday business purchases like office supplies or client dinners for the first $50,000 spent annually. Get 1 point per dollar afterwards.
You will need great to exceptional credit to qualify.
Also check out the American Express® Blue Business Cash Card. Note: the American Express® Blue Business Cash Card is identical to the Blue Business® Plus Credit Card from American Express. However its rewards are in cash rather than points.
Get 2% cash back on all qualified purchases on up to $50,000 per calendar year. Then get 1%.
It has no annual fee. There is a 0% introductory APR for the first one year. Afterwards, the APR is a variable 14.74 – 20.74%.
You will need good to exceptional credit to qualify.
Your Recession-Proof Best Business Credit Cards with No Annual Fee
Your recession-proof best business credit cards with no annual fee with depend on your credit history and scores. Only you can make a decision on which rewards you want and need, so make sure to do your research.
Get the Funding Your Business Craves with Our Credibly Recession Financing Review
If you’ve been looking for a Credibly recession funding review, then look no further.
Credibly is one of several online lending companies. They are actually an emerging Fintech platform. They also provide SBA PPP loans.
Credibly can provide small business funding for working capital or small business expansion. You can also get a line of credit through them, equipment financing, invoice factoring, and merchant cash advances.
Credibly Recession Funding Review: Background
Credibly is located online here: www.credibly.com. Their physical addresses are located in Southfield, Michigan; New York, New York; and Scottsdale, Arizona. You can call them at: (888) 664-1444. Their contact page is here: www.credibly.com/contact.
Your company has to in business for at least 6 months at the minimum. In addition, you need to have at least $15,000 in monthly revenue. You must have a personal credit score of 500 or better.
Credibly also will want to review your most recent three months’ worth of bank statements while they consider whether to grant your application for funding.
Credibly offers $5,000 to $400,000 in funding. Get money fast – within 24 – 48 hours.
Credibly will perform a soft credit pull only to check your qualifications. But before you receive funding, Credibly will do a hard pull which will appear on your credit profile and may affect your credit score.
In addition, they will want a personal guarantee. They do not require you to provide collateral.
Credibly Recession Funding Review: Working Capital Loans
Get up to $400,000 in funding. Terms are 6 to 18 months. Pay factor rates as low as 1.15. For loans over $100,000, they want to see your most recent business tax return.
Credibly Recession Funding Review: Business Expansion Loans
Get up to $250,000 in funding. Terms are 18 or 24 months. Interest rates start at 9.99%. You must have a FICO score of 600 or better and three or more years in business. Also, you must have $3,000 or more in average daily balances.
Credibly Recession Funding Review: Fees
Pay a one-time 2.5% of the total loan amount set up fee. This fee is deducted from your proceeds. Rates start at 9.99%.
Credibly Recession Funding Review: Lines of Credit. Invoice Factoring, and Equipment Financing
These forms of funding are only available through Credibly’s network of external funding partners.
Get up to $400,000 in funding. Duration is anticipated to be 3 to 18 months. Pay factor rates as low as 1.15. Automatic remittances are tied to your receivables.
Credibly Recession Funding Review: Advantages
Advantages include a short time in business requirement. A short time to funding is also attractive.
Credibly Recession Funding Review: Disadvantages
One set of disadvantages are that they will want a personal guarantee and they will do a hard pull on your personal credit.
For startup companies and their founders in particular, who are often on some shaky financial ground to begin with, this could prove problematic. For these sorts of companies and business owners, a better choice might be to try crowdfunding or angel investing if either is possible. In that way, a business owner’s personal assets would be safer. And, their personal credit would not be affected.
A Viable Alternative – Building Business Credit
Business credit is credit in a small business’s name. It doesn’t attach to a business owner’s personal credit, not even when the owner is a sole proprietor and the solitary employee of the small business.
Hence, a business owner’s business and individual credit scores can be very different.
The Advantages
Because company credit is independent from personal, it helps to secure a small business owner’s personal assets, in the event of court action or business insolvency.
Also, with two distinct credit scores, a business owner can get two separate cards from the same merchant. This effectively doubles purchasing power.
Another benefit is that even startup ventures can do this. Going to a bank for a business loan can be a recipe for disappointment. But building company credit, when done correctly, is a plan for success.
Personal credit scores depend on payments but also various other components like credit use percentages.
But for business credit, the scores truly merely depend on if a small business pays its bills timely.
Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!
The Process
Establishing company credit is a process, and it does not occur automatically. A business needs to actively work to establish company credit.
Nevertheless, it can be done readily and quickly, and it is much swifter than developing consumer credit scores.
Vendors are a big component of this process.
Performing the steps out of sequence will cause repetitive denials. Nobody can start at the top with business credit. For instance, you can’t start with retail or cash credit from your bank. If you do, you’ll get a denial 100% of the time.
Company Fundability
A company needs to be fundable to lending institutions and vendors.
Consequently, a company will need a professional-looking web site and e-mail address. And it needs to have site hosting bought from a company like GoDaddy.
Additionally, company phone numbers must have a listing on 411.com. Use ListYourself to get a listing.
Likewise, the business phone number should be toll-free (800 exchange or similar).
A business will also need a bank account dedicated solely to it, and it must have every one of the licenses essential for operation.
Licenses
These licenses all have to be in the particular, correct name of the company. And they need to have the same company address and phone numbers.
So note, that this means not just state licenses, but possibly also city licenses.
Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!
Dealing with the IRS
Visit the Internal Revenue Service web site and obtain an EIN for the company. They’re free. Pick a business entity such as corporation, LLC, etc.
A business can get started as a sole proprietor. But they will most likely wish to switch to a type of corporation or an LLC.
This is in order to decrease risk. And it will optimize tax benefits.
A business entity will matter when it involves taxes and liability in case of litigation. A sole proprietorship means the entrepreneur is it when it comes to liability and tax obligations. Nobody else is responsible.
Sole Proprietors Take Note
If you run a business as a sole proprietor, then at least be sure to file for a DBA. This is ‘doing business as’ status.
If you do not, then your personal name is the same as the company name. Hence, you can find yourself being directly responsible for all small business financial obligations.
Plus, according to the Internal Revenue Service, using this structure there is a 1 in 7 chance of an IRS audit. There is a 1 in 50 probability for corporations! Prevent confusion and dramatically reduce the odds of an Internal Revenue Service audit simultaneously.
Any DBA should be a stepping stone to incorporating.
Starting Off the Business Credit Reporting Process
Start at the D&B web site and get a free D-U-N-S number. A D-U-N-S number is how D&B gets a small business in their system, to generate a PAYDEX score. If there is no D-U-N-S number, then there is no record and no PAYDEX score.
Once in D&B’s system, search Equifax and Experian’s websites for the small business. You can do this at www.creditsuite.com/reports. If there is a record with them, check it for accuracy and completeness. If there are no records with them, go to the next step in the process.
In this manner, Experian and Equifax will have activity to report on.
Vendor Credit
First you ought to build trade lines that report. This is also referred to as vendor credit. Then you’ll have an established credit profile, and you’ll get a business credit score.
And with an established business credit profile and score you can begin to get retail and cash credit.
These types of accounts have the tendency to be for the things bought all the time, like marketing materials, shipping boxes, outdoor work wear, ink and toner, and office furniture.
But to start with, what is trade credit? These trade lines are credit issuers who will give you starter credit when you have none now. Terms are in most cases Net 30, versus revolving.
Therefore, if you get an approval for $1,000 in vendor credit and use all of it, you need to pay that money back in a set term, like within 30 days on a Net 30 account.
Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!
Details
Net 30 accounts must be paid in full within 30 days. 60 accounts need to be paid completely within 60 days. Unlike with revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you made use of.
To kick off your business credit profile the proper way, you should get approval for vendor accounts that report to the business credit reporting agencies. When that’s done, you can then make use of the credit.
Then repay what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.
Vendor Credit – It Helps
Not every vendor can help in the same way true starter credit can. These are vendors that will grant an approval with nominal effort. You also want them to be reporting to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.
You want 3 of these to move onto the next step, which is retail credit.
Retail Credit
Once there are 3 or more vendor trade accounts reporting to at least one of the CRAs, then move onto retail credit. These are companies which include Office Depot and Staples.
Only use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, use the company’s EIN on these credit applications.
Fleet Credit
Are there more accounts reporting? Then progress to fleet credit. These are companies like BP and Conoco. Use this credit to purchase fuel, and to fix and maintain vehicles. Just use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, make certain to apply using the company’s EIN.
Cash Credit
Have you been responsibly handling the credit you’ve up to this point? Then move onto more universal cash credit. These are businesses like Visa and MasterCard. Only use your Social Security Number and date of birth on these applications for verification purposes. For credit checks and guarantees, use your EIN instead.
These are typically MasterCard credit cards. If you have more trade accounts reporting, then these are attainable.
Monitor Your Business Credit
Know what is happening with your credit. Make sure it is being reported and take care of any mistakes ASAP. Get in the practice of checking credit reports. Dig into the details, not just the scores.
So, what’s all this monitoring for? It’s to challenge any problems in your records. Errors in your credit report(s) can be fixed. But the CRAs often want you to dispute in a particular way.
Disputes
Disputing credit report errors generally means you mail a paper letter with copies of any proofs of payment with it. These are documents like receipts and cancelled checks. Never mail the originals. Always mail copies and keep the original copies.
Fixing credit report errors also means you precisely detail any charges you challenge. Make your dispute letter as understandable as possible. Be specific about the problems with your report. Use certified mail so that you will have proof that you mailed in your dispute.
A Word about Building Business Credit
Always use credit responsibly! Don’t borrow more than what you can pay back. Track balances and deadlines for payments. Paying punctually and in full will do more to raise business credit scores than just about anything else.
Establishing business credit pays off. Good business credit scores help a small business get loans. Your credit issuer knows the company can pay its debts. They recognize the company is for real.
The business’s EIN connects to high scores and lenders won’t feel the need to ask for a personal guarantee.
Business credit is an asset which can help your company in years to come. Learn more here and get started toward establishing business credit.
Credibly Recession Funding Review: Takeaways
Companies that do best on Credibly will be fairly new players but with relatively meteoric rises.
A business owner asking for a loan should be prepared for a hard pull on his or her personal credit scores, which will impact those scores. This is just like all hard pulls do.
If an entrepreneur does not have the wherewithal to ride out a slightly lower personal credit score for a couple of years, then Credibly is not for them.
And finally, as with every other lending program, whether online or offline, remember to read the fine print and do the math. Go over the details with care. Decide if this option will be good for you and your company.
In addition, consider alternative financing options that go beyond just lending. These include building business credit and unsecured business financing. This is in order to best decide how to get the money you need to help your business grow.
Get the Funding Your Business Craves with Our Credibly Recession Financing Review If you’ve been looking for a Credibly recession funding review, then look no further. Credibly is one of several online lending companies. They are actually an emerging Fintech platform. They also provide SBA PPP loans. Credibly can provide small business funding for working … Continue reading Need Funding? Our Credibly Recession Financing Review Can Save Your Business
Get the Funding Your Business Craves with Our Credibly Recession Financing Review
If you’ve been looking for a Credibly recession funding review, then look no further.
Credibly is one of several online lending companies. They are actually an emerging Fintech platform. They also provide SBA PPP loans.
Credibly can provide small business funding for working capital or small business expansion. You can also get a line of credit through them, equipment financing, invoice factoring, and merchant cash advances.
Credibly Recession Funding Review: Background
Credibly is located online here: www.credibly.com. Their physical addresses are located in Southfield, Michigan; New York, New York; and Scottsdale, Arizona. You can call them at: (888) 664-1444. Their contact page is here: www.credibly.com/contact.
Your company has to in business for at least 6 months at the minimum. In addition, you need to have at least $15,000 in monthly revenue. You must have a personal credit score of 500 or better.
Credibly also will want to review your most recent three months’ worth of bank statements while they consider whether to grant your application for funding.
Credibly offers $5,000 to $400,000 in funding. Get money fast – within 24 – 48 hours.
Credibly will perform a soft credit pull only to check your qualifications. But before you receive funding, Credibly will do a hard pull which will appear on your credit profile and may affect your credit score.
In addition, they will want a personal guarantee. They do not require you to provide collateral.
Credibly Recession Funding Review: Working Capital Loans
Get up to $400,000 in funding. Terms are 6 to 18 months. Pay factor rates as low as 1.15. For loans over $100,000, they want to see your most recent business tax return.
Credibly Recession Funding Review: Business Expansion Loans
Get up to $250,000 in funding. Terms are 18 or 24 months. Interest rates start at 9.99%. You must have a FICO score of 600 or better and three or more years in business. Also, you must have $3,000 or more in average daily balances.
Credibly Recession Funding Review: Fees
Pay a one-time 2.5% of the total loan amount set up fee. This fee is deducted from your proceeds. Rates start at 9.99%.
Credibly Recession Funding Review: Lines of Credit. Invoice Factoring, and Equipment Financing
These forms of funding are only available through Credibly’s network of external funding partners.
Get up to $400,000 in funding. Duration is anticipated to be 3 to 18 months. Pay factor rates as low as 1.15. Automatic remittances are tied to your receivables.
Credibly Recession Funding Review: Advantages
Advantages include a short time in business requirement. A short time to funding is also attractive.
Credibly Recession Funding Review: Disadvantages
One set of disadvantages are that they will want a personal guarantee and they will do a hard pull on your personal credit.
For startup companies and their founders in particular, who are often on some shaky financial ground to begin with, this could prove problematic. For these sorts of companies and business owners, a better choice might be to try crowdfunding or angel investing if either is possible. In that way, a business owner’s personal assets would be safer. And, their personal credit would not be affected.
A Viable Alternative – Building Business Credit
Business credit is credit in a small business’s name. It doesn’t attach to a business owner’s personal credit, not even when the owner is a sole proprietor and the solitary employee of the small business.
Hence, a business owner’s business and individual credit scores can be very different.
The Advantages
Because company credit is independent from personal, it helps to secure a small business owner’s personal assets, in the event of court action or business insolvency.
Also, with two distinct credit scores, a business owner can get two separate cards from the same merchant. This effectively doubles purchasing power.
Another benefit is that even startup ventures can do this. Going to a bank for a business loan can be a recipe for disappointment. But building company credit, when done correctly, is a plan for success.
Personal credit scores depend on payments but also various other components like credit use percentages.
But for business credit, the scores truly merely depend on if a small business pays its bills timely.
Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!
The Process
Establishing company credit is a process, and it does not occur automatically. A business needs to actively work to establish company credit.
Nevertheless, it can be done readily and quickly, and it is much swifter than developing consumer credit scores.
Vendors are a big component of this process.
Performing the steps out of sequence will cause repetitive denials. Nobody can start at the top with business credit. For instance, you can’t start with retail or cash credit from your bank. If you do, you’ll get a denial 100% of the time.
Company Fundability
A company needs to be fundable to lending institutions and vendors.
Consequently, a company will need a professional-looking web site and e-mail address. And it needs to have site hosting bought from a company like GoDaddy.
Additionally, company phone numbers must have a listing on 411.com. Use ListYourself to get a listing.
Likewise, the business phone number should be toll-free (800 exchange or similar).
A business will also need a bank account dedicated solely to it, and it must have every one of the licenses essential for operation.
Licenses
These licenses all have to be in the particular, correct name of the company. And they need to have the same company address and phone numbers.
So note, that this means not just state licenses, but possibly also city licenses.
Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!
Dealing with the IRS
Visit the Internal Revenue Service web site and obtain an EIN for the company. They’re free. Pick a business entity such as corporation, LLC, etc.
A business can get started as a sole proprietor. But they will most likely wish to switch to a type of corporation or an LLC.
This is in order to decrease risk. And it will optimize tax benefits.
A business entity will matter when it involves taxes and liability in case of litigation. A sole proprietorship means the entrepreneur is it when it comes to liability and tax obligations. Nobody else is responsible.
Sole Proprietors Take Note
If you run a business as a sole proprietor, then at least be sure to file for a DBA. This is ‘doing business as’ status.
If you do not, then your personal name is the same as the company name. Hence, you can find yourself being directly responsible for all small business financial obligations.
Plus, according to the Internal Revenue Service, using this structure there is a 1 in 7 chance of an IRS audit. There is a 1 in 50 probability for corporations! Prevent confusion and dramatically reduce the odds of an Internal Revenue Service audit simultaneously.
Any DBA should be a stepping stone to incorporating.
Starting Off the Business Credit Reporting Process
Start at the D&B web site and get a free D-U-N-S number. A D-U-N-S number is how D&B gets a small business in their system, to generate a PAYDEX score. If there is no D-U-N-S number, then there is no record and no PAYDEX score.
Once in D&B’s system, search Equifax and Experian’s websites for the small business. You can do this at www.creditsuite.com/reports. If there is a record with them, check it for accuracy and completeness. If there are no records with them, go to the next step in the process.
In this manner, Experian and Equifax will have activity to report on.
Vendor Credit
First you ought to build trade lines that report. This is also referred to as vendor credit. Then you’ll have an established credit profile, and you’ll get a business credit score.
And with an established business credit profile and score you can begin to get retail and cash credit.
These types of accounts have the tendency to be for the things bought all the time, like marketing materials, shipping boxes, outdoor work wear, ink and toner, and office furniture.
But to start with, what is trade credit? These trade lines are credit issuers who will give you starter credit when you have none now. Terms are in most cases Net 30, versus revolving.
Therefore, if you get an approval for $1,000 in vendor credit and use all of it, you need to pay that money back in a set term, like within 30 days on a Net 30 account.
Discover our business credit and finance guide, jam-packed with new ways to finance your business without emptying your wallet. Save your money during the recession!
Details
Net 30 accounts must be paid in full within 30 days. 60 accounts need to be paid completely within 60 days. Unlike with revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you made use of.
To kick off your business credit profile the proper way, you should get approval for vendor accounts that report to the business credit reporting agencies. When that’s done, you can then make use of the credit.
Then repay what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.
Vendor Credit – It Helps
Not every vendor can help in the same way true starter credit can. These are vendors that will grant an approval with nominal effort. You also want them to be reporting to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.
You want 3 of these to move onto the next step, which is retail credit.
Retail Credit
Once there are 3 or more vendor trade accounts reporting to at least one of the CRAs, then move onto retail credit. These are companies which include Office Depot and Staples.
Only use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, use the company’s EIN on these credit applications.
Fleet Credit
Are there more accounts reporting? Then progress to fleet credit. These are companies like BP and Conoco. Use this credit to purchase fuel, and to fix and maintain vehicles. Just use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, make certain to apply using the company’s EIN.
Cash Credit
Have you been responsibly handling the credit you’ve up to this point? Then move onto more universal cash credit. These are businesses like Visa and MasterCard. Only use your Social Security Number and date of birth on these applications for verification purposes. For credit checks and guarantees, use your EIN instead.
These are typically MasterCard credit cards. If you have more trade accounts reporting, then these are attainable.
Monitor Your Business Credit
Know what is happening with your credit. Make sure it is being reported and take care of any mistakes ASAP. Get in the practice of checking credit reports. Dig into the details, not just the scores.
So, what’s all this monitoring for? It’s to challenge any problems in your records. Errors in your credit report(s) can be fixed. But the CRAs often want you to dispute in a particular way.
Disputes
Disputing credit report errors generally means you mail a paper letter with copies of any proofs of payment with it. These are documents like receipts and cancelled checks. Never mail the originals. Always mail copies and keep the original copies.
Fixing credit report errors also means you precisely detail any charges you challenge. Make your dispute letter as understandable as possible. Be specific about the problems with your report. Use certified mail so that you will have proof that you mailed in your dispute.
A Word about Building Business Credit
Always use credit responsibly! Don’t borrow more than what you can pay back. Track balances and deadlines for payments. Paying punctually and in full will do more to raise business credit scores than just about anything else.
Establishing business credit pays off. Good business credit scores help a small business get loans. Your credit issuer knows the company can pay its debts. They recognize the company is for real.
The business’s EIN connects to high scores and lenders won’t feel the need to ask for a personal guarantee.
Business credit is an asset which can help your company in years to come. Learn more here and get started toward establishing business credit.
Credibly Recession Funding Review: Takeaways
Companies that do best on Credibly will be fairly new players but with relatively meteoric rises.
A business owner asking for a loan should be prepared for a hard pull on his or her personal credit scores, which will impact those scores. This is just like all hard pulls do.
If an entrepreneur does not have the wherewithal to ride out a slightly lower personal credit score for a couple of years, then Credibly is not for them.
And finally, as with every other lending program, whether online or offline, remember to read the fine print and do the math. Go over the details with care. Decide if this option will be good for you and your company.
In addition, consider alternative financing options that go beyond just lending. These include building business credit and unsecured business financing. This is in order to best decide how to get the money you need to help your business grow.
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