Tag: Recession

Your Ultimate Get Started Guide to Recession Business Finance

First, with COVID-19 in the picture, you are likely in survival mode. If your business has been affected by the pandemic, you need to sign up for the SBA Paycheck Protection Plan, a Disaster loan, or both.  Do it now, because funds are limited and the application process takes time.  This will help your business keep going while you figure out the next steps for whatever the future holds for our economy, including recession business finance.

Everything You Need to Know About Recession Business Finance

During a recession, everything changes.  There is less spending, less lending, and less cash moving period.  Lenders are tighter with what they are willing to dole out, and that leaves many business owners wondering what to do about business funding. It makes recession business finance exceptionally tricky. 

Some sources of funding that may work well during the good times are not reasonable to count on for recession business finance purposes.  It is important to know what options are available and which ones will work best during harder economic times. Recession business finance can be a bit more difficult to navigate.

There are not as many options for recession business finance as there are for business funding during good economic times.  Of the available options, the ones that will work best for you depends on a number of factors. You have to know more about each before you can make an educated decision. It is necessary to know the differences between them, what the qualifications are, and if you even have access to them before you can begin to think about making a decision.

We break it down for you here in our ultimate guide to recession business finance so you can make the best decision possible during the hard times of a recession.

Are Traditional Business Loans an Option for Recession Business Finance?

These are the loans that you go to the bank to get.  As a business, your business credit score can help you get some types of funding even if your personal score isn’t awesome.  That isn’t necessarily the case with this type of funding.

With a traditional lender term loan, you are almost always going to have to give a personal guarantee.  That means they will check your personal credit.  If it isn’t in order, you will likely not get approval.

What does it mean to have your credit score in order? If you have a personal credit score of at least 750 you are in pretty good shape. Sometimes you can get approval with a score of 700+, but the terms will not be as favorable.

If you have really great business credit, your lender might be more inclined to offer a little more flexibility. However, your personal credit score will still weigh heavily on the terms and interest rate.

Of all of the available business funding types, this is the hardest to get. It is usually worth the trouble though if possible, because it often has the best rates and terms.

Term loans are not easy to get, and during a recession, it is even harder.  Unless you have stellar personal and business credit with an already established, successful business, this is a long shot when it comes to recession business finance.

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

SBA Loans

These are government secured term loans offered through traditional banks. The Small Business Administration, or SBA, works with lenders to offer small businesses funding solutions that they may not be able to get based on their own credit history. Because of the government guarantee, lenders are able to relax a little on the personal credit score requirements.

In fact, it is possible to get an SBA micro-loan with a personal credit score between 620 and 640. These are very small loans, up to $50,000.  They may require personal collateral as well.

The trade-off with SBA loans is that the application progress is lengthy. There is a ton of red tape connected with these types of loans.

During a recession however, the government works hard to build the economy.  In light of this, SBA loans may still be a viable option.

Business Line of Credit for Recession Business Finance

This is basically the traditional lender’s version of a business credit card. The credit is revolving, meaning you only pay back what you use, just like a credit card. Rates are typically much better that a credit card.  The application and approval process, however, is more similar to that of a traditional term loan.

If you need revolving credit and can qualify for a term loan, this is the best option. It is great for bridging cash gaps and covering short term expenses without the high credit card interest rates. If you already have this in place before a recession hits, even better!

There are no cash back rewards or loyalty points though.  That makes some business owners prefer business credit cards in some cases, despite higher interest rates.

Since this is basically a revolving traditional loan, it could be as difficult to come by during a recession as a term loan from a traditional lender may be.

When you apply for financing from traditional lenders, they will always ask for certain information.  This is regardless of whether you are applying for a line of credit, an SBA loan, or a traditional term loan.  You will need to provide, at a minimum:

  • A complete, professional business plan if you are a startup
  • Complete company financial statements or tax returns for recent years
  • A list of owners or officers
  • Personal financial information, including bank account balances and credit history

While this list is not exhaustive, it is a good start for what you need to have together before you begin the application process if you plan to pursue this type of recession business finance. 

Credit Line Hybrid

A credit line hybrid is basically revolving, unsecured financing.  It allows you to fund your business without putting up collateral, and you only pay back what you use.

What are the Qualifications?

How hard is it to qualify?  Not as hard as you may think.  You do need good personal credit.  That is, your personal credit score should be at least 685.  In addition, you can’t have any liens, judgments, bankruptcies or late payments.  Also, in the past 6 months, you should have less than 5 credit inquiries, and you should have less than a 45% balance on all business and personal credit cards.  It’s also preferred that you have established business credit as well as personal credit.

If you do not meet all of the requirements, all is not lost. You can take on a credit partner that meets each of these requirements.  Many business owners work with a friend or relative to fund their business. If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding.

What are the Benefits?

There are many benefits to using a credit line hybrid.  First, it is unsecured, meaning you do not have to have any collateral to put up.  Next, the funding is “no-doc.” This means you do not have to provide any bank statements or financials.

Not only that, but typically approval is up to 5x that of the highest credit limit on the personal credit report. Additionally, often you can get interest rates as low as 0% for the first few months, allowing you to put that savings back into your business.

The process is pretty fast, especially with a qualified expert to walk you through it.  One other benefit is this. With the approval for multiple credit cards, competition is created.  This makes it easier, and likely even if you handle the credit responsibly, that you can get interest rates lowered and limits raised every few months.

Invoice Factoring

An established business with accounts receivable can look to invoice factoring as a source of recession business finance. This is where the lender buys your outstanding invoices at a premium, and then collects the full amount themselves. You get cash right away, without waiting for your customers to pay the invoices.

For those businesses already up and running enough to have accounts receivable, this can be a viable option during a recession.  If your customers cannot pay or are paying slowly due to the economic downturn, you can still get the funds you need to run your business, although not at full value of what you would get if your customer paid you.

The cash comes fast, which is also a bonus.  Since the lender collects the funds directly from the customer, this can be a really good recession business finance option.

Because this type of funding is based on receivables, it is still a viable option if your business has them.  The only problem is, during a recession, sales could go down.  This would reduce the amount of funds you have available to you.

If you accept credit cards, you may be able to get a merchant cash advance.  It is similar to invoice factoring, but instead of buying your open invoices, the lender advances cash based on expected credit card sales. 

Break with Tradition: Look to Non-Traditional Lenders for Recession Business Finance

These are lenders other than traditional banks and credit unions that offer terms loans.  Usually they operate online.  Occasionally they will have a brick and mortar location as well.  The difference between these and traditional lenders is that the loans have looser approval requirements and a much faster application process. Most often you can simply apply online, get approval in as little as 24 hours, and the funds are in your account within 24 to 48 hours after approval.

They are an option if your personal credit isn’t terrible and you need funding fast. In times of recession, these guys are a go-to source as they specialize in lending to those that may have trouble with traditional lenders.

There has been an explosion of non-traditional lenders onto the scene in recent years.  Some are better than others.  Be sure to research each one thoroughly.  Check them out on the Better Business Bureau website and read online reviews to get a good start. 

Grants: The Recession Business Finance Miracle

While there are not a lot of these out there, grants are a super source of recession business finance if you can get one. They are usually offered by professional organizations. There are some government grants available also. Competition can be fierce, but they are definitely worth a shot if you think you may qualify.

Requirements vary from grant to grant and most are only awarded to a certain number of recipients. More opportunities are available if you fall into one of the following categories.

  • · Women owned business 
  • · Minority owned business
  • · Businesses run by veterans
  • · Businesses in low income areas

There are also some corporations that offer grants in a contest format that do not require much other than that you meet the corporation’s definition of a small business and win the contest.

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

Interested in a Government Small Business Grant?  Start Here

Federal government small business grants run through the Small Business Administration, but they are rarely awarded directly to a business. Instead, they award the grant to local non-profits or governments to disburse to small businesses in their communities. To find these, check with local economic development agencies and governmental entities to find out what available business funding types they have.

Another place to look is the local Small Business Development Center, or SBDC. These offer support to local small businesses and are generally related to a local college, university, or economic development center.

As a general rule, they do not offer grants themselves.  They can, however, point you in the right direction. They know where the money is, who qualifies, and how to start the application process. These agencies also offer many other services to small businesses, making them a great resource regardless.

Corporate grants are another great option if you live in an area where they are available. Companies like FedEx and LendingTree have grant contests each year.

Grants are a great possibility at any stage of business.  They shouldn’t be counted on too heavily however.  Funds are limited and competition is fierce.  A backup plan is definitely necessary if you are planning to use the funds for a specific purpose.

Business Credit Cards: Can They Work as Recession Business Finance?

Recession Business FinanceCredit cards as a whole get a bad reputation, but in lieu of another option, they can actually do the trick quite nicely. They are more readily even with a credit score that isn’t awesome, but the lower the credit score the higher the interest rate. Also, there are limits on how low they will go with a credit score.

However, this is one of the available business funding types that most of the general public are eligible for at any given time. They do a credit check, but your credit doesn’t have to be as high as it would be to gain approval for a traditional loan.

The downside of business credit cards is that they typically have a high interest rate. The upside is that many of them offer rewards in the form of cash or points that can be helpful.

Credit cards are plentiful even during hard economic times.  It may be harder to get approval if the recession has hit your credit score hard, but there are ways to fix that. 

Apply for business credit cards with your business name and EIN to get them without a personal credit check.  If you do not yet have a business credit score, you need to get one.  Find more about how to establish and build business credit here.

Best Uses for Each Type of Recession Business Finance

Which type of recession business finance you should use in any given situation depends on many variables. The biggest piece of the puzzles is which types of funding you are eligible to receive. However, there really is more to it than that. Assuming you are eligible for all types of financing, here are some other factors to consider.

Startup During a Recession

In the startup phase, there are a couple of things to think about when determining which funding types might work best. 

If you fall into one of those categories that make grants an option, that is the best first stop. Grants are free and clear. That money is yours, without repayment, to use in your business. They typically do not rely on success of the business or the credit worthiness of the owner. The business or proposed business only has to meet the requirements set forth to apply, and then win the grant.

Traditional term loans are a good idea for the startup phase also, if you qualify. The interest rates and terms are generally more favorable than other types of financing for those that meet the credit requirements. They are less of an option during a recession however. 

If you do not meet the credit requirements for traditional term loans, then non-traditional lenders are the next best option. They may have higher interest rates, but they do the trick. Plus, they can help build your business credit score if you make your payments on time.  That, in turn, makes you more eligible for other types of recession business finance.

While not impossible, it is not usually a good idea to start a business using credit cards if it can be avoided.  Of course, invoice factoring is not an option here as you have to already be in business to have the invoices necessary.

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

Growth During a Recession

There are several different aspects of growth that can benefit from various types of business funding.

Inventory Increase

If you see the potential for higher demand and need to increase inventory to accommodate, a revolving credit line is going to work best.

If already in place, these are instantly available to meet the cash needs that a large inventory purchase creates. They also allow for taking advantage of special pricing when available, which can be huge during a recession.

A business line-of-credit works well due to the lower interest rate, but business credit cards will work in this situation also. In fact, if they have really great rewards attached to them, they could even be the better option. It can’t hurt to have both available if you have that luxury so that you have choices.

If available, grants work well for growth projects during a recession also.

Recession Business Finance for Equipment Purchase and Repair

For large equipment, it is best to use traditional term loans of some sort if possible. This is simply because they are typically longer-term loans for larger amounts.  Lower interest rates and favorable repayment terms are key.  However, we all know that isn’t always possible. Other types of recession business finance can be used if necessary.

Grants may be an option if there is not a time crunch. If time is of the essence, it is possible to purchase equipment on credit cards, but you could run in to problems with cost versus credit limit.

Recession Time Expansion

Expanding during a recession can be tricky, if not downright risky.  However, if you want to add on to your current building or add an additional location, term loan financing is the best option. Whether it needs to come from a traditional or non-traditional lender will depend on your specific situation.

Recession Business Finance for Working Capital

Working capital is the cash you have available to run your business. Everything from payroll to repairs, maintenance, seasonal cash gaps, and emergencies are all things working capital covers.

Working capital can come from various sources. There are working capital loans available, but lines- of-credit and business credit cards can work in these situations as well. Unless you already have a working capital loan before the need arises, it is likely you are going to need to access business credit cards or some form of non-traditional financing for this.

In a pinch to cover a cash gap, a merchant cash advance or invoice factoring can work well.

Recession Business Finance Can Be a Delicate Dance: The More You Know About Each Option the Better

It doesn’t matter what type of business you own or whether or not you need funding at this moment. If you own a business you need to know what the available business funding types are, which ones you currently qualify for, and how to qualify for those that are not currently available to you.

You also need to know which types of funding work best in various situations. Once you know these things, you can make an informed decision about how to best fund your business during the recession.

The post Your Ultimate Get Started Guide to Recession Business Finance appeared first on Credit Suite.

Top Recession Crowdfunding Campaigns: How to Push Your Recession Crowdfunding to the Top

The COVID-19 pandemic and the likely resulting recession has most small business owners scrambling for ways to fund their business.  First, be sure you take advantage of all that is offered by the Federal government and your state government, including the Paycheck Protection Plan, or PPP.

How to Run a Successful Crowdfunding Campaign in a Recession

Crowdfunding in a recession may or may not work.  It will be harder to run a successful campaign for sure.  In the best of times, crowdfunding can be hit or miss, so it doesn’t take a lot of imagination to realize it can be worse during a recession.  We can show you how to help yours become one of the top recession crowdfunding campaigns so you can stay afloat during hard economic times.

To become one of the top recession crowdfunding campaigns, you first need to understand what makes any crowdfunding campaign successful.  That’s what we are attempting to help you to do here.  We have found taken a look at some of history’s most successful campaign, and dissected them to figure out what the secret was to their success.

Of course, in a recession people generally have less disposable income.  You can still run top recession crowdfunding campaigns, but it may be harder. The formula holds however. The characteristics of a top campaign remain the same, recession or not.

In both, a healthy dose of luck is needed.  That’s the element that is outside of anyone’s control.  So focus on what you can control.  The first step is understanding exactly what crowdfunding is.

Top Recession Crowdfunding Campaigns: What is Crowdfunding?

It’s actually pretty cool. Crowdfunding sites allow you to pitch your business to thousands of micro investors. Anyone who wants a piece of the action can buy a piece of the proverbial pie.

Investors pledge amounts on a broad spectrum depending on the campaign and the platform in use. They may give $5, $80, $150, or even over $500. Generally speaking, investors can pitch in however much they like.

Though not always necessary, most entrepreneurs offer rewards to investors for their generosity. Typically, this comes in the form of the product the business will be selling. Different levels of giving result in different rewards. For example, a $50 gift may get you product A, while a $100 gift will get you an upgraded version of product A.

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Hit the jackpot and weather any recession with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

Where Do You Start to Launch Top Recession Crowdfunding Campaigns?

There are many crowdfunding sites, but the most popular are Kickstarter and Indiegogo. While the platforms are similar, there are some very large differences. The most obvious is the timing in which you receive the funds from investors.

With Kickstarter, you have to reach your preset goal before you can receive the funds. If you set a goal to raise $12,000, investments have to reach that amount before you get your hands on any of the money.

Indiegogo, on the other hand, lets you choose if you want to receive funds as they come in or wait until you reach your goal. In addition, they have the option for InDemand, which lets you continue to raise funds after your initial campaign is over, without technically starting a new campaign.

Indiegogo also has a flexible funding option for those who may need it.

Each have warranted amazing results for many entrepreneurs. To make the choice for yourself, you need to evaluate who your audience is, and which platform will best reach them.

How Successful Can A Crowdfunding Campaign Really Be?

It can be quite successful actually. While it certainly isn’t the norm, these top campaigns far exceeded their fundraising goals.

Pebble Smart Watch

Pebble actually has several of the top 10 campaigns ever on Kickstarter. Their 2nd campaign is the highest funded campaign to date, reaching over $20,000,000. That’s not too shabby for a goal of only $500,000. They blew it out of the water!

Are they still successful? Well, yeah, but not in the way you may think. They actually sold to FitBit. I call that success, but they no longer exist as their own company.

FlowHive

This one is not one that most would expect to explode onto the scene the way it did. The FlowHive Indiegogo campaign definitely generated some major buzz. The idea was to find a way to get the honey from bees without harming the bees.

Traditionally, hives are simply broken open to obtain the honey. This process can kill the bees. FlowHive developed a fake hive of sorts, made from reusable plastic. Bees make honey in it, and the honey flows through a spout out into the world. The bees are safe and fresh honey is ours for the taking.

Apparently, beekeeping is a growing interest. This campaign raised $14,000,000. Though they won’t disclose exact numbers, the bees at the top claim they are still buzzing along nicely.

CoolestCooler

The CoolestCooler was a Kickstarter campaign that came in at over $13.000,000 raised. The cooler boasted bluetooth and a blender among other super cool gadgets. Investors received a cooler for their donation toward the cause.

This one did run into some trouble when it wasn’t able to deliver investment rewards as quickly as promised, and there was actually a lawsuit. In the end, everything worked out and everyone got their rewards.

The cool gang at CoolestCooler says they are glad to put that behind them and get back to work. You can still buy one today, and it is definitely cool.

Kingdom Death Monster 1.5

Yeah, you read that right. What do you say to that? Well, apparently a lot of people said yes. They said yes to the tune of $12,000,000 on Kickstarter.

It’s a board game, if you are wondering. It did take a while to get the ball rolling, but investors finally got their copy. After production stopped resale values went upwards of $1,000. A later campaign promising updated material did just as well. Seems like a lot people love horror games.

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Hit the jackpot and weather any recession with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

BauBox Travel Jacket

This jacket was set to be hot with 10 different go-go gadget like design elements like a drink holder and a neck pillow. They raised over $11,000,000 across 2 campaigns. While it had a bumpy start, including the jacket being available on retail sites before investors even got theirs, it is still selling today.

What Makes a Successful Crowdfunding Campaign?

There is never a guarantee, but there are a few things that most campaigns that reach epic status have in common. These things don’t guarantee success, but they can usually help you get over any bumps in the road if you also have a great business idea and everything else in place.

Without further ado, here are our best tips for how to become one of the top recession crowdfunding campaigns:

Research

You can’t go in blind.  You have got to know what you are getting into. This is a risk, and research is your protection.  It’s like you are jumping out of a plane, and research is your parachute.

Make sure you can meet demand. Know your market. Find out how much you actually need before you set your goal. Many a well-meaning entrepreneur has kicked off a campaign only to find the demand isn’t there or their goal fell short of what they actually needed to get started.

Show Them Something Real

If you are selling a product, have a sample to show investors. This is key to becoming one of the top recession crowdfunding campaigns. People are much more likely to jump onboard if they can actually see the ship. This one is so important that Kickstarter actually requires you to have a prototype to show investors.

Crowdfunding Platforms are not One Size Fits All

Once you know who your target audience is, you can decide if you would be best served by Kickstarter, Indiegogo, or some other, lesser known yet equally successful platform. If your audience doesn’t frequent the platform you are on, it won’t matter how great your idea or product is. They will never see it.

Do Not Be Afraid to Offer Incentives

But be sure you can deliver. Be fearless. Don’t hold back. I mean, don’t give away the company either, but if someone one is going to help you get started, they deserve something pretty epic for their trouble. Don’t you think?  Go beyond a thank you note and be generous with what you offer as a reward for their support.

Goal Setting is Vital

Setting attainable goals is absolutely necessary to becoming one of the top recession crowdfunding campaigns. Make sure you crunch the numbers with actual facts before you set a fundraising goal.  Be

certain you have production facilities on the line that can meet the timeline goals. Never set random goals with no clue what it will take to reach them or if they are even realistic to reach.

Be Extra with Marketing Materials

You can’t just throw something together. Videos need to be professionally edited. Social media needs to be specifically geared toward your audience. This means you, of course, need to know your audience well.  Are they preppy?  Cheesy?  Hippy?  Play to what they love.

All marketing has to be relatable to your core audience.

Does Being One of the Top Recession Crowdfunding Campaigns Guarantee Success?

No, it doesn’t. If you don’t have the other pieces of the puzzle in place, it doesn’t matter how much you raise, you won’t be able to make a go of it. Meeting your crowdfunding goals certainly helps however.

Just be sure you can meet expectations. If you make promises to investors, keep them. Get your arms around how long it will take to deliver and don’t promise anything any sooner than you can actually handle, taking the recession into account.

If there are problems, address them like a professional. Communication with investors goes a long way.

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Hit the jackpot and weather any recession with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

Have a Back Up Plan

Now, what if you do everything right and it still isn’t enough? This is where having solid business credit comes in. If you need to bridge the gap between your crowdfunding funds and capital needs, a good old-fashioned working capital loan or even business credit cards can get you there.

How to Get Business Credit

Start working on your business credit in conjunction with your crowdfunding campaign, if you haven’t already.  It is never too early.  The first steps are the easiest.  You need to get separate contact information for your business.  This includes an address and a phone number that are not your own.  It also means getting a separate business bank account and using it for all business-related transactions.

Make certain your phone number is toll free, and list it along with your business address under the business name in the directories.

You also need a professional business website and dedicated email address.  The email address should have the same URL as the website.  Do not use a free service such as Yahoo or Gmail.

In addition to these simple things, there are a few other steps that will help further separate your business from yourself.  These include formally incorporating, obtaining an EIN, and applying for a DUNS number.

When it comes to incorporating, you can choose from a corporation, an S-corp, or a limited liability corporation.  They vary in cost and the amount of liability protection they offer, but they all serve the purpose of separating your business so you can build business credit equally.

You can obtain an EIN for free on the IRS website, and the DUNS number is free through the Dun & Bradstreet website.

What’s Next?

Work with starter vendors in the vendor credit tier.  These are vendors that will offer net 30 invoice terms without a credit check, and then they will report your payments to the credit agencies.  If you have laid the groundwork by establishing your business as separate from yourself and getting the necessary identifying numbers, you will now be well on your way to building business credit.

Top Recession Crowdfunding Campaigns are Possible

They really are, but they are not always enough.  Follow these tips and you may meet all your crowdfunding goals.  Start building business credit now though, so that if it isn’t enough, you will have something to fall back on.  Funding a business is never easy, and a recession makes it even harder.  Still, it is possible if you know where to start and where to go.

 

The post Top Recession Crowdfunding Campaigns: How to Push Your Recession Crowdfunding to the Top appeared first on Credit Suite.

Survival of the Fittest: The Essential Guide to Establish Business Credit in a Recession

It may seem that trying to establish business credit in a recession is too little too late. It is definitely better to have strong business credit before a recession hits.  However, if you are in the middle of hard economic times and trying to figure out how to survive and even thrive, all is not necessarily lost.  

Also, business credit is a huge part of fundability.  Strong fundability will benefit your business not only now, but long after the recession is over.  

Establish Business Credit in a Recession: Survival Skills and Tips to Ensure You are Make it Off of Recession Island Alive

Becoming a business owner during a recession can feel much like being dropped into an episode of a survival reality show.  Add in the COVID-19 pandemic and the illusion becomes even closer to reality. Everyone is struggling to hang on. The competition is fierce.  You can only hope you will not be voted off. If you do not already have strong business credit in place, you may think the situation is hopeless.  Yet, it is possible to establish business credit in a recession. It just may take a little more patience and creativity. Truly, nothing breeds creativity like hard times.

Whether you need it immediately or not, it is vitally important to have separate credit for your business.  This is regardless of your current situation. The need is even more pressing during a recession. 

The first step to establishing business credit in a recession is to set up your business as a separate entity from yourself.  Even if you have stellar personal credit, you do not want it tied up with your business. The reverse is true as well. 

If your personal credit goes south due to recession issues, you do not want your business to suffer.  On the flip side, if your business struggles, you want your personal credit protected as much as possible.  

Hit the jackpot and weather any recession with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

Why Establish Business Credit in a Recession?

If you have found yourself on recession island without business credit, you may wonder how it could possibly help to establish it now.  Here’s the thing. No business credit is the same as bad business credit. There is no time like the present. If you do it right, establishing and building business credit during a recession can only help you.  

Business credit can help you access funding to get you through the hard times.  If you need to cover a cash gap brought on by slow-paying customers, business credit can open up options for that.  If you want to purchase inventory in bulk to take advantage of special pricing, business credit can help with that as well.  

These are just two examples of how having strong business credit during a recession can help your business survive.  It’s best to have a strong credit score in place before a recession hits. However, if you do not, you can establish business credit in a recession with these tips.

Separate from the Pack: Get Incorporated

While alliances are often formed on survival reality shows, the truth remains that you cannot trust anyone but yourself.  This is especially true in the beginning. Your business needs to stand on its own. 

The first step to separating your business from yourself and your personal credit is to incorporate.   While easiest done on the front end when you first start your business, it is never too late.

 You have a few options.

  • C Corp– This is the most definitive separation, but it is also the most complicated and expensive.  Before choosing this option, be certain there are reasons other than establishing business credit that it needs to be done.  If it isn’t necessary for some other reason, there are other, less complicated, and less costly options. 
  • S Corp– This option basically offers the same separation as the C Corp, but taxes are paid at the personal level, rather than requiring the business to be taxed as well, resulting in double taxation.  It is also cheaper than incorporating as a C Corp. If you aren’t required to file as a C corp, this is a good alternative. 
  • LLC– forming a Limited Liability Corporation results in less liability, thus the name, and offers enough separation to serve the purpose of establishing business credit.  If you are not required to be a C Corp or S Corp, this is the easiest and most cost-effective way to create the separation of business and personal credit needed. 

Throw off Your Old Self: Get Rid of the SSN

Apply for an EIN and stop using your Social Security Number as the identifying number for your business.  Your SSN is tied to you, personally. It is virtually guaranteed that anything connected to it credit-wise will end up on your personal credit reports.  

In fact, if you follow the other steps for establishing business credit and skip this one, it could end up on both reports.  You don’t want that. 

The process for applying for an EIN is easy.  The IRS has an online form. As soon as all the information is verified you receive your number.  Typically, this happens almost immediately. 

Separate but Equal: Do Not Mingle Personal and Business Finances

Do not buy into the falsehood that you can run your business expenses through the same bank account as your personal expenses.  When you want to establish business credit in a recession or at any other time, your business needs its own account. Separate finances are vital to separate credit.  

You have to separate expenses for tax purposes anyway.  Having a separate business banking account will only make it easier. 

Hit the jackpot and weather any recession with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

Know Who You Report To: Get a Free DUNS Number

Dun and Bradstreet is the most widely used business credit reporting agency.  They issue each business on file a 9-digit D-U-N-S number.  The application is easy and free.  Once you have that number, you will be even closer to establishing credit for your business separate from your own. 

Be Easily Accessible: Set Up Separate Business Contact Information

Your business needs its own phone number.  It should be an 800 number or from some other toll-free exchange.  This way, when you apply for credit, you can enter contact information that is separate from your personal information.  When information is reported to agencies, sometimes the phone number is an identifying factor. If you and your business share a number, that just decreases the level of separation. 

The same is true for a separate business address, email address, and website.  Your business address should not be the same as your home address.  The business email address should contain the website URL. Do not use a free service such as Yahoo or Gmail. 

Make sure your website is professionally presented and put together.  A poorly put together website or broken links can do more damage than you may imagine.

Be sure you get your business phone number and address listed in the directories under the business name. 

Form Preliminary Alliances: Start with the Vendor Credit 

After you separate your business from yourself, it is time for the next step to establish business credit in a recession.  Do business with starter vendors that will extend invoices with net30 terms. Then, when you pay, they will report the payment to the business credit reporting agencies.  As a bonus, if you are finding yourself short on necessities due to the COVID-19 outbreak, these vendors may have what you need. Toilet paper, paper towels, and cleaning products are all available through some starter vendors. 

Typically, these vendors issue net terms without regard to either your personal or business credit score.  This makes them the perfect way to begin building your business credit score. While there are a lot of these types of vendors out there, some are better to start with than others.  

You want to start with those that offer products you will use in the daily course of business.  They also need to have minimal requirements for net30 terms. Though they do not check credit, some do have minimum time in business or annual revenue requirements.  Others only require that you make a few initial purchases before they will extend net terms.

Three of the most common starter vendors that work great at the beginning of the process include: 

  • Quill– offers office and cleaning supplies
  • Uline– sells packing supplies
  • Grainger– supplies for working outside including tools

Keep Building: Apply for Business Credit Cards 

Continuing to build business credit is the next step after you establish business credit in a recession.  Once you have your name, EIN, separate contact information, and 5 to 7 starter vendors reporting to the credit agencies, you can apply for credit from certain retailers. This step includes specific stores that issue credit to be used only in their stores or on their website.

Shoot for the highest limit, lowest interest, and most rewards options possible.  Perks like cash back and travel points can pay off. 

If you only qualify for a $200 limit and a higher-end interest rate, in the beginning, that is fine.  You may not be able to get the best rate with a business that has a shorter credit history. This is especially true during a recession. However,  if you pay consistently and on time, things should change quickly. 

After you have several store accounts reporting, you can apply for fleet cards.  These include cards from companies such as Shell and Fuelman that you can only use to pay for gasoline and automobile repairs. 

Once you have several accounts reporting from all three of these types of cards, you can apply for credit that isn’t restricted by retailer or purchase type.  These include well-known credit cards such as Visa and Mastercard that offer higher limits, lower rates, and better rewards. 

Look for Friends in Unlikely Places: Open Talks with Your Utility ProvidersEstablish Business Credit in a Recession Credit Suite

Sometimes utility companies are willing to report payments to credit agencies.  However, you almost always have to ask. The worst they can do is refuse. If they do, no harm no foul.  If they agree, you will only establish your business credit faster. 

Remember, if you are having trouble making utility payments right now due to reduced income related to coronavirus, you should probably wait to do this.  Instead, talk to the utilities about what options they are offering in these circumstances. Some are not counting missed payments against customers for a couple of months.  You have to discuss this with them however, do not assume anything. 

Talk to them all, including telephone, electric, gas, and even internet.  Before you do this, be certain that all of these utilities are in your company name under your separate business contact information. 

Handle Your Business: Make Payments on Time

Of course, the most important part of establishing business credit is making on-time payments.  If this doesn’t happen, then you will not like the credit you establish. It’s equally important whether you are trying to establish business credit in a recession or in a strong economic climate.  Admittedly, it can be much harder during a recession, especially one induced by a global pandemic. Be sure you take advantage of all the resources available to help you stay current. 

Planning is an important part of this.  Do not overspend, and try not to use credit that you cannot pay back in a timely manner. It doesn’t have to be paid off all at once.  You need to make payments to build credit, but be sure you can actually make the payments.

Hit the jackpot and weather any recession with our best webinar and its trustworthy list of seven vendors who can help you build business credit.

You Can Establish Business Credit in a Recession

If you follow these steps, it is possible to establish business credit in a recession.  For new businesses, it can fall into place easily in the normal course of creating a business.  If you have been around a while, it may require some backtracking. A recession may mean it takes longer, but it is more than doable if you follow the steps and trust the process. 

The post Survival of the Fittest: The Essential Guide to Establish Business Credit in a Recession appeared first on Credit Suite.

Survival of the Fittest: The Essential Guide to Establish Business Credit in a Recession

It may seem that trying to establish business credit in a recession is too little too late. It is definitely better to have strong business credit before a recession hits.  However, if you are in the middle of hard economic times and trying to figure out how to survive and even thrive, all is not … Continue reading Survival of the Fittest: The Essential Guide to Establish Business Credit in a Recession

Fight Back: Get an Unsecured Business Line of Credit in a Recession

The COVID-19 pandemic has quite literally turned the economy on its head.  Businesses are suffering, and recession is imminent.  Not only that, but aside from the influx of federal funds to the SBA, banks are not going to keep lending so freely for much longer. The time to get funding to help your business survive the recession is now.  Still, is it even possible to get an unsecured business line of credit in a recession?

Everything You Need to Know Before You Apply for an Unsecured Business Line of Credit in a Recession

Even during a recession, it is almost impossible to run a business without financing.  At some point you will need a large supply of cash that you do not have. Even if you do have sizeable cash reserves, it is typically not a good idea to deplete them all at once.  A line of credit can be a huge help, because the credit line is revolving. This means you do not have to continually apply for it. It is just there to use as needed. The problem is, small business lending drastically decreases during a recession.   How do businesses survive then? How can you get an unsecured business line of credit in a recession?

Before You Learn How, Learn Why

Before the how, know the why.  An unsecured business line of credit in a recession can help you make repairs, cover a cash gap, or just take advantage of an awesome wholesale promotion without reapplying for credit. You are likely not going to have all the cash on hand.  This is especially during a recession.

Even if you do, a business line of credit is a great way to build business credit and manage cash flow.  If you use it properly. The question then becomes not “if” you need business financing, but rather “what type” of business financing do you need.

The options are many. Which one is best for your business will depend on multiple factors. There are both unsecured and secured lines of credit, term loans, various types of invoice lending, credit cards and more.  During hard economic times, some financing options are more available than others. The greatest cutbacks on lending are in the larger banks. Typically, traditional term loans are squeezed the hardest.

Therefore, finding an unsecured line of credit in a recession isn’t impossible.  It may not be as easy to come by as during an economic boom, but it is possible. You are likely to have better luck at the smaller banks.

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

The Fine Print

Under each lending option there are sub options for specific types of borrowers, specific borrower needs, secured, unsecured, and even options with cash back and other rewards.

The best way to make a decision is to learn as much as you can about each one.  Do this before you need financing. Then when the time comes, you already know what you need.

The unsecured line of credit is one option that is often misunderstood. It can be difficult to determine why you would choose this option over a secured line of credit or a term loan, and if you do, what are the benefits?

Why Choose a Line of Credit?

The best way to explain this is to line up the unsecured line of credit head to head with the most commonly used other options.

Unsecured Line of Credit in a Recession vs. Term Loans

Besides the fact that it is much harder to get a term loan during a recession, the answer here is pretty straight forward. If you need cash occasionally for various reasons, a line of credit is your best bet.  If you have a large, specific purchase or project, then a term loan could work better depending on a number of variables.

Consider the following scenarios:

One company is beginning to see cash gaps due to a lag in customer payments.  The recession is hitting everyone hard, and while no one has completely stopped paying, the average time receivables stay on the books has increased. In this situation, a line of credit is the best option. You will have the financing to use from month to month.  Also, you can take only what you need, and pay it back once the invoices are paid.

The next company needs to add another truck to its fleet to handle the shipping for increased orders.  This kind of growth is fortunate given the recession, but they need to finance the truck. In this situation, a term loan would be best.  It may be difficult to find given the slow economy, but the smaller banks may just come through.

Unsecured Line of Credit in a Recession vs. a Business Credit Card

A credit card is very similar to a line of credit. Most often the glaring difference is the use of a card, though some business lines of credit offer a card for access in addition to checks.  Similar to how some credit cards offer checks for access as well as a card.

Another difference is that sometimes you can use your lending institution’s online banking option to make direct transfers from a line of credit to a checking account, if the accounts are at the same institution. Also, if you need cash, there is no cash withdrawal fee usually with a line of credit. Credit card cash advance fees can expensive.

Credit cards tend to have higher interest rates than business lines of credit also, though unsecured lines of credit in a recession can have very high interest rates as well.

What if You Could Have Both? Credit Line Hybrid

What if there were an option that allowed you to have an even better interest rate than a secured loan, and yet get the money faster and easier than any type of traditional funding.  What if you could get business funding similar to an unsecured business line of credit without having to supply any bank statements or check stubs? Imagine that you could get funding in a few days rather than weeks without supplying any collateral or documents? This is exactly what the credit line hybrid allows you to do.

What is a Credit Line Hybrid?

A credit line hybrid is basically revolving, unsecured financing.  It allows you to fund your business without putting up collateral, and you only pay back what you use.

What are the Qualifications?

How hard is it to qualify?  Not as hard as you may think.  You do need good personal credit.  That is, your personal credit score should be at least 685.  In addition, you can’t have any liens, judgments, bankruptcies or late payments.  Also, in the past 6 months, you should have less than 5 credit inquiries, and you should have less than a 45% balance on all business and personal credit cards.  It’s also preferred that you have established business credit as well as personal credit.

If you do not meet all of the requirements, all is not lost. You can take on a credit partner that meets each of these requirements.  Many business owners work with a friend or relative to fund their business. If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding.

Unsecured Line of Credit in a Recession vs Secured Line of Credit

Now that you can see the benefit of using a line of credit over other financing options in certain situations, you need to know when and why to choose an unsecured line of credit.

The fact is, an unsecured line of credit in a recession, or in times of a strong economy, is harder to get. It typically has the higher interest rate of the two as well.

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

This is due to increased risk to the lender. A secured business line of credit has collateral. If you don’t pay, the lender can still use the collateral to recover some if not all of the loss.

Some business owners either do not have collateral to offer, or they have no interest in tying up their assets with financing. In these cases, they may be able to get line of credit without security.

An unsecured line of credit in a recession typically has strict approval guidelines and qualifications. Due to the increased credit risk, it will likely have higher interest rates and less favorable repayment terms as well.

Where Can You Find an Unsecured Line of Credit in a Recession?

As a general rule, the same places you could any other time.  Not all lenders offer this as a product, but there are options available at many traditional and alternative type lenders. Which one you go with depends, again, on your specific situation.  During an economic downturn, alternative lenders may be your best bet.

Traditional lenders offer the lowest interest rates, but their repayment terms may be less flexible. They will also have qualifications that are harder to meet and a longer approval process. In addition, it can take several days after approval to have access to the funds.

An alternative lender will usually have easier to meet qualifications and more flexible repayment terms, but the interest rates are much higher. The approval process is much faster though, and usually takes place all online.  In some cases, you can have access to funds in as little as 24 hours.

Application Preparation

The items you need to apply for an unsecured line of credit in a recession are the same as what you would need for any other time. It will vary from lender to lender, but a general list includes:

· Bank statements

· Financial statements

· Tax returns

Some lenders will check your business credit score, and sometimes even your personal credit score as well. A score of 620 is usually the minimum requirement for approval, but some alternative lenders do not require a minimum score.  Some traditional lenders may require a higher score for an unsecured business line of credit in a recession than it would otherwise.

They are looking for minimum annual revenue as well.  Traditional banks are more likely to grant approval at $180,000 or more of revenue annually.  Alternative lenders usually have a lower threshold.

Basically, lenders want to see how long you have been in business and what your annual revenue is, thought exactly what they need to see to grant approval varies from lender to lender.

Examples of Unsecured Line of Credit in a Recession Options Unsecured Business Line of Credit in a Recession Credit Suite2from Real Lenders

Seeing exactly what types of products are currently available from real lenders can be helpful in understanding the difference between what traditional and alternative lenders offer.  Please note that lenders change product offerings and terms at their leisure, and then a change in economic client with trigger a change. Therefore, there is no guarantee these products have not been adjusted since this writing.

Traditional Lenders

Bank of America

There is currently an unsecured line of credit product available from Bank of American that ranges from $10,000 to $100,000. There is a $50 origination fee if approved. The origination fee is a limited time offer.  It is usually $150.

A business must have been in business for two years and have a minimum of $100,000 in annual revenue to qualify.

Alternative Lenders

Fundbox

The unsecured line of credit offered by Fundbox goes up to $100,000. You will also have to have a business bank account. 

The interest rate will increase based on annual revenue and time in business.

OnDeck

OnDeck offers an unsecured business line of credit of up to $100,000.  You repay it weekly for up to 6 months.

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

Blue Vine

This one ranges from $5,000 to $250,000.  The repayment term is from 6 to 12 months.

StreetShares

With repayment terms from 3 to 36 months, this is a good option if you qualify. Amounts start at $5,000 and range up to $150,000. They also offer some specialty products with lower interest rates.

An Unsecured Business Line of Credit in a Recession Is a Viable Option

Even if the recession has caused lenders to cut back, an unsecured line of credit in a recession could be an option.  It is way better than a term loan during a recession for a number of reasons. The first is that you can control payments.  

A term loan requires a set payment each month, while a line of credit requires you only to make payments on the amount you use.  If you only use what you need, you will very likely come out with a lower monthly payment.

If you don’t have collateral or do not want to tie up your assets with financing, an unsecured line of credit is an option. The repayment only on what you use may cost less than an unsecured term loan despite the higher interest due to being unsecured.

The bottom line is that an unsecured business line of credit can be more costly than a secured line of credit, but less costly than a term loan. While they are easier to get if you have been in business longer, have higher annual revenue, and have a great credit score, they are not impossible to get without these things. If you are not sure how much you need, or the need could vary, and you do not want to tie up assets or do not have assets to offer as security, then an unsecured business line of credit could be for you.

The post Fight Back: Get an Unsecured Business Line of Credit in a Recession appeared first on Credit Suite.

Seize the Day with Our OnDeck Review for Terrific Recession Financing

Avoid Business Funding Pitfalls and Let Our OnDeck Review Guide You

Itching for funding? Our OnDeck review helps you make your best possible business decision.

OnDeck is one of several online lending companies. They offer short term loans and lines of credit. We look at the specifics and drill down into the details.

Recession Age Financing

The number of US banks as well as thrifts has been decreasing progressively for a quarter of a century. This is coming from consolidation in the marketplace in addition to deregulation in the 1990s, lowering obstacles to interstate banking. See: fundera.com/blog/happened-americas-small-businesses-financial-crisis-six-years-start-crisis-look-back-10-charts

Assets focused in ever‐larger financial institutions is problematic for small business proprietors. Big banks are much less likely to make small loans. Economic declines indicate financial institutions come to be extra careful with lending. Fortunately, business credit does not count on financial institutions.

OnDeck Review: Background

OnDeck is located online here: www.ondeck.com. Their American physical address is:

1400 Broadway
New York, NY 10018.

You can call them at: (888) 269-4246. You can email them at: customerservice@ondeck.com. There is no contact page but you can chat with customer service directly on their site. They have been in business since 2007.

OnDeck Online also has a Canadian division, located online here: en-ca.ondeck.com. There is, in addition, an Australian division, located online here: www.ondeck.com.au. There is even a French version of the Canadian site.

OnDeck also receives some small business loan referrals from Prosper. See: www.prosper.com/borrower/#/prospect/pre-registration.

They will not work with certain industries. See: https://www.ondeck.com/restricted-industries.

OnDeck Review: Term Loans

Amounts available range from $5,000 – $500,000. You can get terms of 3 to 36 months.

Your company must have annual revenue of $100,000 or more. Your own personal FICO score has to be 600 or better. And your company must be in business for 1 year or more.

OnDeck Review: Fees

Interest rates start at 11.89% annual percentage rate (APR). The total cost of a short term loan will vary based on a number of factors, including personal and business credit scores, time in business and annual revenue and cash flow.

OnDeck Review: Lines of Credit

Get a line of credit from OnDeck for $6,000 to $100,000. The term is 12 months.

Withdraw up to $10,000 with Instant Funding.

Your company must have annual revenue of $100,000 or more. Your own personal FICO score has to be 600 or better. And your company must be in business for 1 year or more.

OnDeck Review: Fees

Interest rates start at 10.99% annual percentage rate (APR). The total cost of a line of credit will vary based on a number of factors, including personal and business credit scores, time in business and annual revenue and cash flow.

OnDeck Review: Advantages

Advantages include the rather low FICO score requirement for term loans. Plus there is some flexibility when it comes to term lengths. In addition, few United States-based online lenders will loan outside of the country. But OnDeck will loan to Canadian and Australian businesses.

OnDeck Review: Disadvantages

Disadvantages are the maximum APR for both term loans and lines of credit are somewhat high. Therefore, if your company cannot pay back a loan or line of credit, it could potentially sink you financially. In addition, OnDeck requires a personal guarantee.

OnDeck Review: Upshot

Companies helmed by entrepreneurs with bad personal credit would do well to take a second look at the OnDeck online lending company. However, with qualification comes a steep APR price tag and the requirement of a personal guarantee. This is somewhat understandable.

Borrowers in Canada and Australia can also work with OnDeck, although Canadian borrowers also have NUGROWTH/IBIS (www.nugrowthcapital.com) as an option, although NUGROWTH/IBIS has a higher minimum personal FICO score requirement.

Entrepreneurs would probably do better building business credit and/or trying for unsecured business financing or microloans if their financial requirements are small.

OnDeck Review Credit Suite

Learn business loan secrets with our free, sure-fire guide. We can help you get money, even during a recession.

Building Business Credit Instead

Company credit is credit in a small business’s name. It doesn’t connect to a business owner’s consumer credit, not even when the owner is a sole proprietor and the solitary employee of the company. Accordingly, an entrepreneur’s business and personal credit scores can be very different.

The Benefits

Business credit helps to safeguard an entrepreneur’s personal assets, in case of court action or business bankruptcy. Also, with two distinct credit scores, an entrepreneur can get two separate cards from the same vendor.

This effectively doubles purchasing power.

Another benefit is that even startups can do this. Heading to a bank for a business loan can be a recipe for disappointment. But building business credit, when done right, is a plan for success.

Individual credit scores are dependent on payments but also various other elements like credit use percentages. But for company credit, the scores really only hinge on whether a corporation pays its invoices in a timely manner.

The Process

Growing company credit is a process, and it does not occur without effort. A business will need to actively work to develop business credit. Having said that, it can be done readily and quickly, and it is much more efficient than establishing individual credit scores.

Merchants are a big aspect of this process.

Carrying out the steps out of sequence will lead to repetitive denials. No one can start at the top with corporate credit. For example, you can’t start with store or cash credit from your bank. If you do you’ll get a rejection 100% of the time.

Business Credibility

A company has to be genuine to lenders and vendors. Consequently, a business will need a professional-looking website and email address, with website hosting bought from a company such as GoDaddy.

Also business telephone and fax numbers must have a listing on ListYourself.net.

At the same time the company telephone number should be toll-free (800 exchange or the like).

A business will also need a bank account devoted purely to it, and it has to have every one of the licenses necessary for operation. These licenses all must be in the identical, accurate name of the company, with the same company address and phone numbers.

So keep in mind that this means not just state licenses, but potentially also city licenses.

Working with the Internal Revenue Service

Visit the Internal Revenue Service website and obtain an EIN for the business. They’re totally free. Choose a business entity such as corporation, LLC, etc.

A business can begin as a sole proprietor. But they will more than likely want to change to a form of corporation or partnership to reduce risk and take full advantage of tax benefits.

A business entity will matter when it comes to tax obligations and liability in the event of a lawsuit. A sole proprietorship means the entrepreneur is it when it comes to liability and taxes. No one else is responsible.

Sole Proprietors Take Note!

If you run a business as a sole proprietor, then at the very least be sure to file for a DBA (‘doing business as’) status.

If you do not, then your personal name is the same as the company name. As a result, you can end up being personally responsible for all corporate financial obligations.

Also, per the Internal Revenue Service, with this arrangement there is a 1 in 7 chance of an IRS audit. There is a 1 in 50 probability for corporations! Prevent confusion and drastically lower the odds of an Internal Revenue Service audit simultaneously.

OnDeck Review Credit Suite

Learn business loan secrets with our free, sure-fire guide. We can help you get money, even during a recession.

Setting off the Business Credit Reporting Process

Begin at the D&B web site and obtain a totally free DUNS number. A DUNS number is how D&B gets a small business in their system, to produce a PAYDEX score. If there is no DUNS 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 corporation. 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 way, Experian and Equifax will have activity to report on.

Trade Lines

First you should build trade lines that report. This is also called vendor accounts. 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 getting revolving store and cash credit.

These kinds of accounts often tend to be for the things bought all the time, like coffee, shipping boxes, outdoor work wear, ink and toner, and office furniture.

But first of all, what is trade credit? These trade lines are credit issuers who will give you preliminary credit when you have none now. Terms are ordinarily Net 30, rather than revolving.

So if you get an approval for $1,000 in vendor credit and use all of it, you must 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. In comparison with revolving accounts, you have a set time when you must pay back what you borrowed or the credit you used.

To begin your business credit profile the right way, you ought to get approval for vendor accounts that report to the business credit reporting agencies. 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 is Terrific!

Not every vendor can help like true starter credit can. These are vendors that will grant an approval with hardly any effort. You also need them to be reporting to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.

But you may have to apply more than one time to these vendors, and you may have to purchase some things you do not really need, to confirm you are reliable and will pay on time. Consider giving nonessential items to charity.

Revolving Store Credit

Once there are 5 to 8 or more vendor trade accounts reporting to at least one of the CRAs, progress to revolving store credit. These are companies such as Office Depot and Staples. These companies are more likely to have supplies you need.

Use the corporation’s EIN on these credit applications.

Fleet Credit

Are there 8 to 10 accounts reporting? Then move onto fleet credit. These are businesses like BP and Conoco. Use this credit to buy, repair, and maintain vehicles. Make sure to apply using the corporation’s EIN.

Cash Credit

Have you been responsibly handling the credit you’ve up to this point? Then progress to cash credit. These are businesses such as Visa and MasterCard. Keep your SSN off these applications; use your EIN instead.

These are businesses like Walmart and Dell, and also Home Depot, BP, and Racetrac. These are normally MasterCard credit cards. If you have 14 trade accounts reporting, then these are feasible.

Monitor Your Business Credit

Know what is happening with your credit. Make certain it is being reported and address any inaccuracies ASAP. Get in the habit of checking credit reports. Dig into the particulars, not just the scores.

We can help you monitor business credit at Experian and D&B for 90% less. Update the data if there are mistakes or the information is incomplete.

OnDeck Review Credit Suite

Learn business loan secrets with our free, sure-fire guide. We can help you get money, even during a recession.

Contesting Inaccuracies

So, what’s all this monitoring for? It’s to dispute any errors in your records. Mistakes in your credit report(s) can be taken care of. But the CRAs usually want you to dispute in a particular way.

Disputing credit report errors commonly means you send a paper letter with copies of any proofs of payment with it. These are documents like receipts and cancelled checks. Never mail the original copies. Always mail copies and retain the original copies.

Disputing credit report inaccuracies also means you specifically detail any charges you dispute. Make your dispute letter as understandable as possible. Be specific about the issues with your report. Use certified mail so that you will have proof that you sent in your dispute.

A Word about Building Business Credit

Always use credit responsibly! Don’t borrow beyond what you can pay off. Keep track of balances and deadlines for repayments. Paying on schedule and fully will do more to raise business credit scores than virtually anything else.

Growing corporate credit pays. Excellent business credit scores help a company get loans. Your lending institution knows the small business can pay its debts. They recognize the small business is bona fide.

The small business’s EIN connects to high scores, and credit issuers won’t feel the need to call for a personal guarantee.

Business credit is an asset which can help your corporation for years to come. Learn more here and get started toward growing business credit.

OnDeck Review: Some Final Thoughts

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, and decide if this option will be good for you and your company. In addition, consider alternative financing options that go beyond lending. And these include building business credit.

This is so you can best decide how to get the money you need to help your business grow.

Today, we want to hear from our audience! Share your voice with us about your experiences with online lenders.

 

The post Seize the Day with Our OnDeck Review for Terrific Recession Financing appeared first on Credit Suite.

Empower Your Business with 0% APR Business Credit Cards in a Recession

Get Epic 0% APR Business Credit Cards in a Recession

Do you know how to get 0% APR Business Credit Cards in a recession? We break down the many choices out there to show you the best corporate credit cards with 0% APR.

Per the SBA, corporate credit card limits are often 10 – 100 times that of personal cards! This means you can get a lot more cash with business credit.

And this also means you can have personal credit cards at retail stores, and now have a second card at the same shops for your company. And you will not need collateral, cash flow, or financials to get small business credit.

0% APR Business Credit Cards in a Recession: Benefits

Features vary, so make certain to pick the perk you prefer from this selection of possibilities.

Alternatives to 0% APR Business Credit Cards in a Recession: 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 charge.

You will not need to supply your Social Security number to use. And you will not need to supply a personal warranty. They will take your EIN. Nevertheless, they do not accept every industry. Additionally, there are some industries they will not work with, and others where they want added paperwork. For a list, go here: https://brex.com/legal/prohibited_activities/.

To determine creditworthiness, Brex checks a business’s cash balance, spending patterns, and investors.

You can get 7x points on rideshare. Get 4x on Brex Travel. Also, get triple points on dining establishments. And get double points on recurring software payments. Get 1x points on everything else.

You can have poor credit scores (even a 300 FICO) to qualify.Find it here: https://brex.com/lp/startups-higher-limits/

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

Secure Business Credit Cards for Fair Credit

 

Capital One® Spark® Classic for Business

Check out the Capital One® Spark® Classic for Business. It has no annual cost. There is no initial APR offer. The regular APR is a variable 24.49%. You can get limitless 1% cash back on every purchase for your business, without minimum to retrieve.

While this card is within reach if you have fair credit, beware of the APR. However if you can pay in a timely manner, and in full, after that it’s a bargain.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-classic/0% APR Business Credit Cards in a Recession Credit Suite

Superior Business Credit Cards without Annual Charge

No Yearly Fee/Flat Rate Cash Back

Ink Business Unlimited ℠ Credit Card

For a great example of 0% APR business credit cards in a recession, look into the Ink Business Unlimited ℠ Credit Card. Beyond no yearly cost, get an initial 0% APR for the initial twelve months. After that, the APR is a variable 14.74 – 20.74%. You can get endless 1.5% Cash Back rewards on every purchase made for your company. As well as obtain $500 bonus cash back after investing $3,000 in the first three months from account opening. You can redeem your incentives for cash back, gift cards, traveling and even more through Chase Ultimate Benefits ®. You will require excellent credit report to get approved for this card.Find it here: https://creditcards.chase.com/business-credit-cards/ink/unlimited

Alternatives to 0% APR Business Credit Cards in a Recession:

0% APR Business Credit Cards in a Recession – Pay Absolutely Nothing!

Blue Business® Plus Credit Card from American Express

For a great example of 0% APR business credit cards in a recession, have a look at the Blue Business® Plus Credit Card from American Express. It has no annual charge. There is a 0% introductory APR for the initial one year. After that, the APR is a variable 14.74 – 20.74%.

Get double Subscription Rewards ® points on day-to-day business purchases like office supplies or customer suppers for the initial $50,000 spent per year. Get 1 point per dollar after.

You will certainly require excellent to superb credit report to qualify.

Find it here: https://creditcard.americanexpress.com/d/bluebusinessplus-credit-card/

American Express® Blue Business Cash Card

Additionally take a look at the American Express® Blue Business Cash Card. Note: the American Express® Blue Business Cash Card is identical to Blue Business® Plus Credit Card from American Express. However its rewards are in cash rather than points.

Get 2% money back on all qualified purchases on approximately $50,000 per calendar year. After that get 1%.

It has no annual cost. There is a 0% introductory APR for the initial year. After that, the APR is a variable 14.74 – 20.74%.

You will need great to superb credit to qualify.

Find it here: https://creditcard.americanexpress.com/d/business-bluecash-credit-card/

Terrific Cards for Cash Back

Flat-Rate Rewards

Capital One ® Spark® Cash for Business 

Look into the Capital One® Spark® Cash for Business. It has an introductory $0 annual fee for the very first year. After that, this card costs $95 per year. There is no initial 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 unrestricted 2% cash back. Redeem any time with no minimums.

You will need good to superb credit to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash/

Flat-Rate Rewards and No Yearly Cost

Discover it® Business Card

For a great example of 0% APR business credit cards in a recession, have a look at the Discover it® Business Card. It has no yearly fee. There is an initial APR of 0% on acquisitions for one year. After that the routine APR is a variable 14.49 – 22.49%. Get unrestricted 1.5% cash money back on all purchases, with group restrictions or perks. They double the 1.5% Cashback Match™ at the end of the very first year. There is no minimum spend requirement.

You can download deals quickly to Quicken, QuickBooks, as well as Excel. Note: you will need great to superb credit scores to get approval for this card.

Find it here: https://www.discover.com/credit-cards/business/?ICMPGN=PUB_HNAV_CARDS_BUSINESS

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

Bonus Categories

Ink Business Cash℠ Credit Card

For a great example of 0% APR business credit cards in a recession , check out the Ink Business Cash℠ Credit Card. It has no annual cost. There is a 0% initial 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 initial 3 months from account opening.

You can earn 5% cash back on the very first $25,000 spent in mixed acquisitions at workplace supply shops and also on web, cord and phone services each account wedding anniversary year. Get 2% cash back on the initial $25,000 spent in combined purchases at gas stations and also restaurants each account anniversary year. Get 1% cash back on all other purchases. There is no limit to the amount you can earn.

You will need outstanding credit scores to get approval for this card.

Locate it right here: https://creditcards.chase.com/business-credit-cards/ink/cash?iCELL=61GF

Boosted Cash Back Categories

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% initial APR for the first 9 billing cycles of the account. Afterwards, the APR is 13.74% – 23.74% variable. There is no annual charge. You can get a $300 statement credit offer.

Get 3% cash back in the group of your choice. So these are filling stations (default), office supply shops, travel, TV/telecom & wireless, computer services or business consulting solutions. Get 2% cash back on dining. So this is for the first $50,000 in combined choice category/dining purchases each calendar year. After that make 1% after, unlimited.

You will need excellent credit scores to qualify.

Find it here: https://promo.bankofamerica.com/smallbusinesscards2/

Alternatives to 0% APR Business Credit Cards in a Recession: Flexible Financing Credit Cards – Take A Look at Your Alternatives!

The Plum Card® from American Express

Have a look at the Plum Card® from American Express. It has an initial annual fee of $0 for the first year. Afterwards, 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 good to outstanding credit to qualify.

Find it here: https://creditcard.americanexpress.com/d/the-plum-card-business-charge-card/

Check out how our reliable process will help your business get the best business credit cards, even during a recession.

Irresistible Cards for Jackpot Rewards That Never Expire

Capital One® Spark® Cash Select for Business

For a great example of 0% APR business credit cards in a recession, have a look at the Capital One® Spark® Cash Select for Business. It has no yearly cost. You can get 1.5% cash back on every purchase. There is no limitation on the cash back you can earn. And get a one-time $200 cash bonus when you spend $3,000 on purchases in the first three months. Rewards never run out.

Pay a 0% introductory APR for 9 months. Then pay 14.49% – 22.49% variable APR after that.

You will need good to excellent credit to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash-select/

Company Credit Cards for Extravagant Travel Points

Flat-rate Travel Rewards

Capital One® Spark® Miles for Business

Have a look at the Capital One® Spark® Miles for Business. It has an introductory annual cost of $0 for the first year, which then rises to $95. The regular APR is 18.49%, variable due to the prime rate. There is no introductory annual percentage rate. Pay no transfer fees. Late fees go up to $39.

This card is excellent for travel if your expenditures don’t come under standard bonus categories. You can get unlimited double miles on all purchases, with no restrictions. Get 5x miles on rental cars and hotels if you book with Capital One Travel.

Get an introductory benefit of 50,000 miles. That’s the same as $500 in travel. But you only get it if you spend $4,500 in the first 3 months from account opening. There is no foreign transaction fee. You will need a great to superb FICO rating to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-miles/

Bonus Travel Categories with Sign-Up Offer

Ink Business Preferred℠ Credit Card

For a wonderful sign-up deal and bonus categories, look into the Ink Business Preferred℠ Credit Card.

Pay an annual cost of $95. Regular APR is 17.49 – 22.49%, variable. There is no introductory APR offer.

Get 100,000 bonus points after spending $15,000 in the initial 3 months after account opening. This works out to $1,250 towards travel rewards if you redeem using Chase Ultimate Rewards.

Get three points per dollar of the first $150,000 you spend with this card. So this is for purchases on travel, shipping, internet, cable, and phone services. Plus it includes advertising purchases made with social media sites and also search engines each account anniversary year.

You can get 25% more in travel redemption when you redeem for travel via Chase Ultimate Rewards. You will need a good to superb FICO score to qualify.

Find it here: https://creditcards.chase.com/business-credit-cards/ink/business-preferred

No Yearly Fee

Bank of America® Business Advantage Travel Rewards World Mastercard® credit card

For a great example of 0% APR business credit cards in a recession, take a look at this card from Bank of America. It has no annual fee and a 0% introductory APR for purchases during the first 9 billing cycles. Afterwards, its regular APR is 13.74 – 23.74% variable.

You can earn 30,000 bonus points when you make at the very least $3,000 in net purchases. So this is within 90 days of your account opening. You can redeem these points for a $300 statement credit towards travel purchases.

Get unlimited 1.5 points for every $1 you spend on all purchases, everywhere, every time. And this is no matter how much you spend.

Likewise earn 3 points per every dollar spent when you book your travel (car, hotel, airline) through the Bank of America® Travel Center. There is no limit to the number of points you can earn and points do not expire.

You will need outstanding credit scores to get this one (as in, 700s or better).

Find it here: https://www.bankofamerica.com/smallbusiness/credit-cards/products/travel-rewards-business-credit-card/

Hotel Credit Card

Marriott Bonvoy Business™ American Express® Card

Check out the Marriott Bonvoy Business™ Card from American Express. It has a yearly fee of $125. There is no introductory APR offer. The regular APR is a variable 17.24 – 26.24%. you will need good to superb credit scores to get this card.

Points

You can get 75,000 Marriott Bonvoy points after using your card to make purchases of $3,000 in the first 3 months. Get 6x the points for eligible purchases at participating Marriott Bonvoy hotels. You can get 4x the points at US restaurants and gasoline stations. And you can get 4x the points on wireless telephone services bought directly from US service providers and on US purchases for shipping.

Get double points on all other eligible purchases.

Rewards

And also, you get a free night each year after your card anniversary. And you can make an additional free night after you spend $60,000 on your card in a calendar year.

You get free of charge Marriott Bonvoy Silver Elite status with your Card. And also, spend $35,000 on qualified purchases in a calendar year and also make an upgrade to Marriott Bonvoy Gold Elite status through completion of the next calendar year.

And also, each calendar year you can get credit for 15 nights towards the next level of Marriott Bonvoy Elite status.

Find it here: https://creditcard.americanexpress.com/d/bonvoy-business/

Your Best 0% APR Business Credit Cards in a Recession and More

Your absolute best 0% APR business credit cards in a recession will hinge upon your credit history and scores. Just you can determine which features you want and need, so make sure to do your research. And, as always, make certain to build business credit in the recommended order for the best, fastest benefits.

The post Empower Your Business with 0% APR Business Credit Cards in a Recession appeared first on Credit Suite.

3 Recession Factors that Can Devastate a New Business Credit Score

Did You Know These Recession Factors Can Devastate a New Business Credit Score?

These are three ways you can devastate a new business credit score. Do not let anything like this happen to you! These are easily preventable. Save your business credit scores!

Uh, oh. You tried to build a commercial credit score without truly thinking it through and taking into consideration what affects small business credit rating. Let’s take a look at 3 factors that can devastate your business credit scores. And how to fix them.

And you do have to fix them, because this is what affects a business credit rating.

In particular, this is an issue during economic downturns.

Recession Era Financing and COVID-19

As the novel coronavirus continues to transform our economy, it becomes more imperative than ever to keep your business credit scores high. It’s no time to make preventable errors – like these three.

Devastate a New Business Credit Score: 3. You Used More Credit Than Your Company Could Handle

Credit can be intoxicating. Take a look at all that free cash! Look at all the important things your company needs!

Wait; wait, whoa, time out!

It is not free cash. It’s a loan, really. All credit is whether it’s commercial or consumer. If you have gone on a wild credit spree, your credit rating is going to be affected. How? Delinquency.

When you are that much in hock, it may be tricky to stay on top of the payments. Late payments will directly and adversely impact your business credit score. So be responsible with credit. This isn’t gambling; it’s your livelihood and the livelihood of anyone who works for you.

Devastate a New Business Credit Score: 2. You Didn’t Stay on Top of Your Credit Scores or Dispute CRA Mistakes

While credit reports aren’t exactly page turners, you should still be staying on top of them.

Don’t have time to read through credit reports? Then use a monitoring service. Experian offers Business Credit Advantage. PAYDEX has Credit Reporter. And Equifax has Business Credit Monitor. If you prefer a free version for credit alerts, you can try CreditSignal.

Fix Your New Business Credit Score Now!

The point of all of that monitoring is to spot errors and fix them. If any one of your credit reports has mistakes, then you must get on top of that, without delay. Disputing credit report errors generally means you send a paper letter with copies of any proofs of payment with it.

These are documents like receipts and cancelled checks.

Details of How to Fix a New Business Credit Score

Never send the originals. Always send copies and retain the originals. Precisely detail any charges you dispute. Make your dispute letter as crystal clear as possible. Use certified mail so that you will have proof that you sent in your dispute.

Contesting an error quickly means your credit reports will be corrected more quickly.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

Devastate a New Business Credit Score: 1. You Didn’t Separate Your Company and Individual Credit (or You Didn’t Do So Quickly)

The longer and more intimately your personal and business finances are entangled, the more likely it is that credit reporting agencies will take your consumer credit into account when looking at your company.

This doesn’t give your company a chance to make its own credit ‘name’, as it were. When you examine your company credit score vs personal credit score, they should be different.

You Can Change a New Business Credit Score

Paying off your business’s charges with personal charge cards or checks; not getting a separate IRS EIN number for your company; and not putting your business’s bills in the company’s name can all aggravate this problem.

And the Internal Revenue Service will probably have something to say about your business not having its own identification number.

Fix a New Business Credit Score Now!

So to repair this, your mission is as follows:

  • Get an EIN first. You can apply online after you determine your eligibility. That is, if your business is located within the US, etc.
  • Visit your local bank and open a small business banking account
  • Contact local vendors and get your company’s bills put into the company’s name. While you’re at it, see if you can start to build trade credit with them
  • Always pay the business’s bills with your business accounts or credit

Get a Great New Business Credit Score Bad Economy Credit Suite

Bonus – Business Credit Building

Factors that can devastate your business credit scores include not building business credit in the proper manner. So here’s how to do that. Corporate credit is credit in a small business’s name.

It isn’t attached to an owner’s individual credit, not even when the owner is a sole proprietor and the solitary employee of the business. Therefore, an entrepreneur’s business and individual credit scores can be very different.

The Advantages

Because business credit is detached from consumer, it helps to safeguard an entrepreneur’s personal assets, in the event of a lawsuit or a business bankruptcy. Also, with two distinct credit scores, an entrepreneur can get two separate cards from the same merchant.

This effectively doubles buying power.

Another advantage is that even startup businesses can do this. Heading to a bank for a business loan can be a recipe for disappointment. But don’t worry. Building small business credit, when done correctly, is a plan for success.

Personal credit scores rely on payments but also various other considerations like credit usage percentages. But for business credit, the scores actually just depend on whether a small business pays its bills in a timely manner.

The Process

Building Small Business Credit is a process, and it does not occur automatically. A business must proactively work to build corporate credit. Nonetheless, it can be done readily and quickly, and it is much quicker than establishing personal credit scores. Merchants are a big part of this process.

Undertaking the steps out of order will cause repeated rejections. Nobody can start at the top with corporate credit. For instance, you can’t start with store or cash credit from your bank. If you do you’ll be turned down 100% of the time.

Company Legitimacy

A business needs to be legitimate to lenders and vendors. As a result, a corporation will need a professional-looking web site and e-mail address, with site hosting purchased from a supplier such as GoDaddy. Plus company telephone and fax numbers ought to be listed on 411. com. Also the company telephone number should be toll-free (800 exchange or comparable).

A corporation will also need a bank account dedicated purely to it, and it needs to have all of the licenses required for operating. These licenses all have to be in the precise, appropriate name of the corporation, with the same company address and telephone numbers.

Note that this means not just state licenses, but possibly also city licenses.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

Dealing with the IRS

Visit the Internal Revenue Service web site and get an EIN for the small business– they’re free. Choose a business entity like corporation, LLC, etc.

A small business can start off as a sole proprietor but will probably want to switch to a kind of corporation or partnership to reduce risk and take full advantage of tax benefits.

And a business entity will matter when it comes to tax obligations and liability in case of a lawsuit. A sole proprietorship means the owner is it when it comes to liability and taxes. No one else is responsible.

DBAs

If you operate a small business as a sole proprietor at least file for DBA (‘ doing business as’) status. If you do not, then your personal name is the same as the corporate name. Consequently, you can end up being personally liable for all company debts.

Also, per the IRS, by having this arrangement there is a 1 in 7 possibility of an IRS audit. There is a 1 in 50 probability for incorporated businesses! Avoid confusion and considerably lower the chances of an Internal Revenue Service audit at the same time.

And see a DBA as a stepping stone to incorporating. It shouldn’t be your final destination for your choice of business entity.

Kicking Off the Business Credit Reporting Process

Begin at the D&B web site and obtain a free DUNS number. A DUNS number is how D&B gets a small business in their system, to generate a PAYDEX score. If there is no DUNS number, then there is no record and no PAYDEX score.

Once in D&B’s system, search Equifax and Experian’s sites for the company. You can do this at https://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.

By doing so Experian and Equifax will have activity to report on.

Vendor Credit

First you need to build trade lines that report. This is also known 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 obtaining revolving store and cash credit.

These sorts of accounts tend to be for the things bought all the time, like shipping boxes, outdoor work wear, ink and toner, and office furniture.

What is Trade Credit?

But first of all, what is Trade Credit? These trade lines are creditors who will give you preliminary credit when you have none now. Terms are normally Net 30, as opposed to revolving.

Hence if you get approval for $1,000 in vendor credit and use all of it, you must pay that money back in a set term, such as within 30 days on a Net 30 account.

Net 30 accounts need to be paid in full within 30 days. 60 accounts have to be paid fully within 60 days. Unlike with revolving accounts, you have a set time when you must pay back what you borrowed or the credit you used.

Start Building Business Credit

To kick off your business credit profile the proper 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, repay what you used, and the account is reported to Dun & Bradstreet, Experian, or Equifax.

Vendor Credit Helps!

Not every vendor can help in the same way true starter credit can. These are merchants 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 revolving store credit.

Uline Shipping Supplies

Uline Shipping Supplies is a true starter vendor. Find them online at uline.com. They sell shipping, packing, and industrial supplies, and they report to D&B.

You must have a DUNS number. They will request 2 references and a bank reference. The initial few orders may need to be prepaid to initially get approval for Net 30 terms.

Quill Office Supplies

Quill Office Supplies is an additional true starter vendor. Find them online at quill.com. They sell office, packaging, and cleaning supplies, and they report to D&B and Experian.

Place an initial order first unless the D&B score is developed. Normally they’ll put you on a 90 day prepayment schedule.

If you order items each month for 3 months, they will commonly approve you for a Net 30 Account.

Grainger Industrial Supply

Grainger Industrial Supply is also a true starter vendor. Find them online at grainger.com.

They sell safety equipment, plumbing supplies, and more, and they report to D&B. You will need to have a business license, EIN, and a DUNS number. For less than $1000 credit limit they will approve virtually any person with a business license.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

Accounts That Do Not Report

Non-Reporting Trade Accounts can also be helpful. While you do want trade accounts to report to at the very least one of the CRAs, a trade account which does not report can nevertheless be of some worth.

You can always ask non-reporting accounts for trade references. And also credit accounts of any sort will help you to better even out business expenses, thereby making financial planning less complicated. These are providers like PayPal Credit, T-Mobile, and Best Buy.

Retail Credit

Once there are 3 or more vendor trade accounts reporting to at least one of the CRAs, move onto revolving store credit. These are companies like Office Depot and Staples. These companies are more likely to have items you need.

Use the corporation’s EIN on these credit applications.

Fleet Credit

Are there more accounts reporting? Then move onto fleet credit. These are businesses such as BP and Conoco. Use this credit to buy, repair, and maintain vehicles. Make sure to apply using the small business’s EIN.

If you already have adequate trade lines, you can get an approval.

Cash Credit

Have you been sensibly managing the credit you’ve up to this point? Then move to more universal cash credit. These are businesses such as Visa and MasterCard. Keep your SSN off these applications; use your EIN instead.

These are commonly 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 certain it is being reported and take care of any mistakes as soon as possible. Get in the practice of checking credit reports and digging into the specifics, and not just the scores.

We can help you monitor business credit at Experian and D&B for 90% off.

At Equifax, you can monitor your account at: equifax.com/business/business-credit-monitor-small-business.

Fix a New Business Credit Score Now!

Update the info if there are inaccuracies or the information is incomplete. At D&B, you can do this at: https://iupdate.dnb.com/iUpdate/viewiUpdateHome.htm.

For Experian, go here: experian.com/small-business/business-credit-information.jsp.

Equifax: equifax.com/business/small-business.

Contesting Errors Which Can Devastate a New Business Credit Score

What’s all this monitoring for? It’s to contest any mistakes in your records. Errors in your credit report( s) can be taken care of. But the CRAs often want you to dispute in a particular way.

Get your small business’s PAYDEX report at: dnb.com/about-us/our-data.html.

You can get your company’s Experian report at: businesscreditfacts.com/pdp.aspx?pg=SearchForm.

And get your Equifax business credit report at: equifax.com/business/credit-information.

Disputes

Disputing credit report mistakes normally means you mail a paper letter with copies of any evidence of payment with it. These are documents like receipts and cancelled checks. Never mail the original copies. Always mail copies and keep the originals.

Disputing credit report mistakes also means you precisely detail any charges you contest. Make your dispute letter as crystal 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.

Details

Also, dispute your or your corporation’s Equifax report by following the instructions here: equifax.com/small-business-faqs/#Dispute-FAQs.

Dispute inaccuracies on your or your small business’s Experian report by following the directions here: experian.com/small-business/business-credit-information.jsp.

So, D&B’s PAYDEX Customer Service contact number is here: dandb.com/glossary/paydex.

Also, always use credit responsibly! Don’t borrow more than what you can pay off. Track balances and deadlines for payments. Paying punctually and fully will do more to increase business credit scores than virtually anything else.

Factors That Can Devastate a New Business Credit Score – Takeaways

Building corporate credit pays. Good business credit scores help a corporation get loans. Your lending institution knows the corporation can pay its financial obligations. They know the company is for real.

The corporation’s EIN links to high scores, and creditors won’t feel the need to ask for a personal guarantee.

Save your business credit scores! Learn more here and get started toward getting rid of these factors that can devastate a new business credit score.

The post 3 Recession Factors that Can Devastate a New Business Credit Score appeared first on Credit Suite.

How to Easily Improve Your Business Credit Scores in a Recession

Yes, You Can Easily Improve Your Business Credit Scores in a Recession – This is Foolproof!

Do you know your small business’ business credit score? And is it, maybe, not so hot? Then consider these simple tips for how to easily improve your business credit scores in a recession.

Every Small Business Needs Business Credit Building

This is especially true in an economic downturn, when bank loans can be scarce.

Company credit is credit in a small business’s name. It doesn’t attach to an owner’s personal credit, not even when the owner is a sole proprietor and the sole employee of the small business.

Thus, an entrepreneur’s business and personal credit scores can be very different.

The Benefits

Because small business credit is distinct from consumer, it helps to protect a business owner’s personal assets, in case of litigation or business bankruptcy.

Also, with two distinct credit scores, a small business owner can get two different cards from the same vendor. This effectively doubles purchasing power.

Another benefit is that even startup businesses can do this. Visiting a bank for a business loan can be a formula for disappointment. But building small business credit, when done right, is a plan for success.

Personal credit scores are dependent on payments but also additional considerations like credit usage percentages.

But for small business credit, the scores truly just depend on whether a small business pays its debts timely.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

Easily Improve Your Business Credit Scores in a Recession: Take Steps to Improve Your Payment History

How do you improve your payment history? It’s easy – just pay your bills on time, and as close to ‘in full’ as possible. Of course, that is not always as easy as it sounds. The truth is, just as you need to keep your personal spending within your means, you will need to keep your business spending realistic as well.

We cannot predict the future. Who can tell if your company’s particular widget will suddenly take off? All you can do is go by whatever data you can get, and interpret it in a manner that is not overly optimistic. For new companies, that means looking at industry trends. For more seasoned companies, it means closely examining your business’s performance under all sorts of conditions.

Therefore, if it looks like your company can make $1 million next quarter, but you need to borrow money, don’t borrow more than $1 million and, in fact, you probably want to borrow less than that.

Keeping your business spending in check and not gambling the company’s future on a hunch are both good ways to get your credit balances down and, as a result, improve your payment history. After all, your biggest supplier could go out of business, your best worker could retire, or crops could fail or any of a number of setbacks could occur. Being bold in business can often be a virtue – but you still need to pay your company’s bills.

It Pays – Big Time!

The single most vital step you can take to improve your business credit scores is to improve your payment history. Every credit reporting agency weighs this factor heavily.

Easily Improve Your Business Credit Scores in a Recession: Keep on Top of Your Credit Scores

This means regularly getting and reviewing your credit reports. And not just for your business! For new businesses and sole proprietorships, credit bureaus often look at your person credit as well. And this goes double if your business just so happens to be both.  Therefore, you will need to keep on top of both sets of scores, which is a good financial habit to get into, anyway.

Why do this? Because credit scoring reports can have errors and you have the right to dispute them. But you will not know there’s an error unless you check.

Disputing credit report errors generally involves sending a paper letter with copies of all proofs of payment accompanying it, such as receipts and cancelled checks. Of course, you do not want to send the originals – always send copies and retain the originals. Precisely itemize any charges that you are calling into question. Use certified mail so that you will have proof that you sent in your dispute.

Of course, if there are no mistakes on your credit reports, then you will need to move onto the next step. Don’t try to pull a fast one and dispute your credit score if there is really nothing wrong with it! Credit reporting agencies understandably do not like that.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

Easily Improve Your Business Credit Scores in a Recession: Keep a Handle on Your Credit Utilization Rate

This goes right along with improving your payment history. Your credit utilization rate is an easy calculation: it’s just your balances divided by your total available credit.

You want to keep this figure under 30% if that is at all possible. So if you borrow less money, and you pay your debts off as quickly as possible, you will keep your business’s credit utilization rate in check.

Credit reporting agencies look at this figure, so if you keep it low, that will help with your score.

Furthermore, credit utilization rate tends to go toward your ability to better balance your budget and work within your means. Of course there can be unexpected expenses. But those should be rare.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

Easily Improve Your Business Credit Scores in a Recession: Monitor Your Business Credit

Know what is happening with your credit. Make sure it is being reported and attend to any inaccuracies ASAP. Get in the practice of taking a look at credit reports and digging into the particulars, and not just the scores.

We can help you monitor business credit at Experian and D&B for 90% less.

At Equifax, you can monitor your account at: www.equifax.com/business/business-credit-monitor-small-business.

Update Your Record

Update the relevant information if there are mistakes or the information is incomplete. At D&B, you can do this at: https://iupdate.dnb.com/iUpdate/viewiUpdateHome.htm. For Experian, go here: www.experian.com/small-business/business-credit-information.jsp. And for Equifax, go here: www.equifax.com/business/small-business.

Fix Your Business Credit

So, what’s all this monitoring for? It’s to contest any inaccuracies in your records. Errors in your credit report(s) can be fixed. But the CRAs typically want you to dispute in a particular way.

Get your company’s PAYDEX report at: www.dnb.com/about-us/our-data.html. Get your company’s Experian report at: www.businesscreditfacts.com/pdp.aspx?pg=SearchForm. And get your Equifax business credit report at: www.equifax.com/business/credit-information.

Disputes

Disputing credit report errors normally means you mail a paper letter with duplicates of any proofs of payment with it. These are documents like receipts and cancelled checks. Never mail the originals. Always send copies and keep the original copies.

Fixing credit report errors also means you specifically spell out any charges you challenge. Make your dispute letter as crystal clear as possible. Be specific about the concerns with your report. Use certified mail so that you will have proof that you sent in your dispute.

Dispute your or your small business’s Equifax report by following the instructions here: www.equifax.com/small-business-faqs/#Dispute-FAQs.

You can dispute inaccuracies on your or your small business’s Experian report by following the directions here: www.experian.com/small-business/business-credit-information.jsp.

And D&B’s PAYDEX Customer Service contact number is here: www.dandb.com/glossary/paydex.

Easily Improve Your Business Credit Scores in a Recession Credit Suite

Easily Improve Your Business Credit Scores in a Recession: Personal Credit Score Reports

You can use AnnualCreditReport.com to get your credit report from Transunion, Equifax, and Experian.

Easily Improve Your Business Credit Scores in a Recession: Business Credit Score Reports

You will need to keep on top of three separate reports: Equifax, Experian, and your business’s PAYDEX report.

Equifax

Order your business’s Equifax report here. Dispute your or your company’s Equifax report by following the instructions here.

Experian

You can order your company’s Experian report here.  You can dispute any errors on your or your company’s Experian report by following the directions here.

PAYDEX

Get your PAYDEX report here and you can contact their Customer Service department (it’s a part of Dun & Bradstreet, as they also generate PAYDEX reports) here. D & B’s PAYDEX Customer Service phone number is here.

Easily Improve Your Business Credit Scores in a Recession: Patience is a Virtue in the Credit World, Too!

Finally, you will need to be patient. In particular, because credit reporting bureaus look at payment history. And they also look at the length of your payment history. So this goes directly to how long your company has been in business.

As a result, one piece of the score improvement puzzle is to just let some time pass. Get some distance you from your opening day. Good business credit scores aren’t built in a day.

Easily Improve Your Business Credit Scores in a Recession: A Word about Business Credit Building

Always use credit responsibly! Never borrow more than what you can pay back. Monitor balances and deadlines for payments. Paying off in a timely manner and in full will do more to raise business credit scores than nearly anything else.

Establishing small business credit pays off. Great business credit scores help a small business get loans. Your lender knows the company can pay its financial obligations. They recognize the company is bona fide.

The business’s EIN attaches to high scores and lending institutions won’t feel the need to request a personal guarantee.

Easily Improve Your Business Credit Scores in a Recession: Takeaway

Business credit is an asset which can help your small business for many years to come. Learn more here and get started toward building company credit.

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