Monday, July 30, 2007
Friday, July 27, 2007
Business Credit Building Process -- Reader Question
Here is a question from a prospective BusinessCreditSuccess.com member:
1:What is the ideal number of business credit cards to apply for at level 2?
2:How much corporate credit can I realistically expect to build over a 1 to 2 year time frame?
Answers:
Thanks for the great questions! First, many of the business credit cards don't report to the business credit reporting agencies such as Experian and D&B. If they don't report, they don't benefit your business credit rating. Just as with personal credit, you'll want to build a mix of credit references that report in order to build a solid business credit rating. These may include vendors, specialty cards (office supply or gasoline cards etc.) as well as a business card that does report.
Secondly, there are no magic numbers in this process. Every lender is different, and the amount of credit you will get depends on your business track record, credit history, the industry you are in, as well as your personal credit score. For a business that is only one to two years old, you can expect to have your personal credit reviewed for most loans. However, you may easily be able to get trade credit in the name of your business, and the less business debt that appears on your personal credit report, the better.
Building business credit is a process that occurs over time and the sooner you get started the better!
1:What is the ideal number of business credit cards to apply for at level 2?
2:How much corporate credit can I realistically expect to build over a 1 to 2 year time frame?
Answers:
Thanks for the great questions! First, many of the business credit cards don't report to the business credit reporting agencies such as Experian and D&B. If they don't report, they don't benefit your business credit rating. Just as with personal credit, you'll want to build a mix of credit references that report in order to build a solid business credit rating. These may include vendors, specialty cards (office supply or gasoline cards etc.) as well as a business card that does report.
Secondly, there are no magic numbers in this process. Every lender is different, and the amount of credit you will get depends on your business track record, credit history, the industry you are in, as well as your personal credit score. For a business that is only one to two years old, you can expect to have your personal credit reviewed for most loans. However, you may easily be able to get trade credit in the name of your business, and the less business debt that appears on your personal credit report, the better.
Building business credit is a process that occurs over time and the sooner you get started the better!
Tuesday, July 24, 2007
BusinessCreditSuccess.com Interviewed in Wall Street Journal Today
BusinessCreditSuccess.com was mentioned today in an article about the use of business credit cards for small business funding in the Wall Street Journal.
The article included some examples of entrepreneurs who successfully - and not so successfully - used credit cards to help fund their businesses.
If you have a small business, I'd love to hear about your experience using credit cards as a source of capital. Feel free to weigh in here!
The article included some examples of entrepreneurs who successfully - and not so successfully - used credit cards to help fund their businesses.
If you have a small business, I'd love to hear about your experience using credit cards as a source of capital. Feel free to weigh in here!
Tuesday, July 17, 2007
Understanding How to Build Business Credit
Here's a great question we received from a subscriber to our alerts:
I've formed my corporate structure, got an active DUNS # and have a few vendors for a PayDex score.I'm having trouble finding a web hosting company and other needed vendors that bill Net 30 and report to DNB.Do you have CURRENT lists of vendors that report?
This seems like the only part of any corporate credit building program that's really worth it, a UP TO DATE database. Also, does your database have actual credit pulls, the limits granted or denied by those vendors?
Answer: Our list of vendors that report to DNB, Experian and SBFE are updated frequently and we are always looking for more. But it is no easy task. DNB does not publish those lists and, in fact, if you order a DNB report you won't see the individual creditors listed by name.
Unlike personal credit, where the lenders seem to automatically agree to report if they pull credit, the reporting for business credit is much more fragmented.
However, when our members alert us to a vendor they would like to report, we do everything we can to help them understand the value in doing so, and connect them with the business credit reporting agencies. We have found it to be a much easier process with Experian than with DNB, but as long as the vendor has enough references to report, it is achievable.
Keep in mind that while D&B is the granddaddy in the business credit reporting world, Experian and the SBFE (administered by Equifax) have also made significant process and, based on our experience, we believe that trend will continue. In addition, in our program we list numerous business credit reporting agencies that may influence your ability to get the loans and terms you need.
As for getting the specific details from lenders in terms of whom they approve or deny for credit and the size of the credit lines I don't hold out a lot of hope for obtaining that information. It's proprietary and competitive and I can't see lenders providing it.
We hope you'll find our Business Credit Success program useful, but if you don't, we offer a full money back guarantee. We hope you will join us!
PS: Our members will be joining us this month for a special teleclass with a credit reporting expert and insider. We hope you'll join us!
I've formed my corporate structure, got an active DUNS # and have a few vendors for a PayDex score.I'm having trouble finding a web hosting company and other needed vendors that bill Net 30 and report to DNB.Do you have CURRENT lists of vendors that report?
This seems like the only part of any corporate credit building program that's really worth it, a UP TO DATE database. Also, does your database have actual credit pulls, the limits granted or denied by those vendors?
Answer: Our list of vendors that report to DNB, Experian and SBFE are updated frequently and we are always looking for more. But it is no easy task. DNB does not publish those lists and, in fact, if you order a DNB report you won't see the individual creditors listed by name.
Unlike personal credit, where the lenders seem to automatically agree to report if they pull credit, the reporting for business credit is much more fragmented.
However, when our members alert us to a vendor they would like to report, we do everything we can to help them understand the value in doing so, and connect them with the business credit reporting agencies. We have found it to be a much easier process with Experian than with DNB, but as long as the vendor has enough references to report, it is achievable.
Keep in mind that while D&B is the granddaddy in the business credit reporting world, Experian and the SBFE (administered by Equifax) have also made significant process and, based on our experience, we believe that trend will continue. In addition, in our program we list numerous business credit reporting agencies that may influence your ability to get the loans and terms you need.
As for getting the specific details from lenders in terms of whom they approve or deny for credit and the size of the credit lines I don't hold out a lot of hope for obtaining that information. It's proprietary and competitive and I can't see lenders providing it.
We hope you'll find our Business Credit Success program useful, but if you don't, we offer a full money back guarantee. We hope you will join us!
PS: Our members will be joining us this month for a special teleclass with a credit reporting expert and insider. We hope you'll join us!
Friday, July 06, 2007
New Nevada Corporate Laws -- If You Own A Nevada Corp.
If you have incorporated in Nevada or are thinking about it, you must be aware of the new Nevada Corporate Laws and how they will affect you. There are some important changes which go into effect July 1, 2007. In particular, they affect:
Bearer shares -- which have now been made illegal.
New disclosure rules for the ownership of Nevada corporations.
New rules regarding charging orders for Nevada corporations.
Most of the changes are positive, and I strongly recommend you read the article posted by the Sutton Law Center that explains them in more detail.
Bearer shares -- which have now been made illegal.
New disclosure rules for the ownership of Nevada corporations.
New rules regarding charging orders for Nevada corporations.
Most of the changes are positive, and I strongly recommend you read the article posted by the Sutton Law Center that explains them in more detail.
Thursday, July 05, 2007
Mommy Millionaire: The Best Business Book I've Read In a Long Time
Mommy Millionaire, the story of Kim Lavine's roller coaster ride from stay at home mom to successful business owner, is undoubtedly the best small business start-up book I've read in a long time. If you have a small business, and wonder whether you are going to lose your mind, your life savings, or everything in between, you absolutely must read this book.
If you haven't seen Kim's story on television or in magazines, she's the inventor of a unique heating pad called the Wuvit. She appears to be an overnight success, but the truth is that her business took her family to the verge of bankruptcy before she made it big.
One reason I loved reading Mommy Millionaire was Kim's brutally honest descriptions of the ups and downs of her business, combined with smart, detailed advice on the various steps involved in getting a venture off the ground. I've taken pages of notes and quotes, and to tempt you, here are just a few excerpts:
"Here’s what I learned from four years at Harvard Business School and a Wharton MBA:
1. Cash is Kind
2. Sell your mother for Cash if you can."
Page 201
"Constantly dealing with a cash shortage at the beginning is not a personal reflection of your inability to run a business; it’s just part of business."
Page 202
"There is nothing more dangerous than a person with…" Read page 264 to find out the answer.
When Kim had a terribly difficult year, ending up in debt and wondering if it was the worst thing that ever happened to her business, she found out it was the best thing that ever happened to her business. Read page 268 to find out why.
One point that came through several times in her book is that every self-made millionaire walks through fire to get to where they are. "Instant success" stories rarely reflect the sleepless nights, the cash flow crunches, the credit messes and the insane craziness of being self-employed.
The only quibble I have is with her advice on page 37 that you should close accounts you don't use to raise your credit score. For the newer Vantage credit scores that may be true, but for FICO credit scores, the most widely used, the advice is the opposite -- leave them alone.
Again, I can't recommend Mommy Millionaire highly enough as a great read for entrepreneurs as well as those who want to start their own business. Once you've read it, let me know if you agree!
If you haven't seen Kim's story on television or in magazines, she's the inventor of a unique heating pad called the Wuvit. She appears to be an overnight success, but the truth is that her business took her family to the verge of bankruptcy before she made it big.
One reason I loved reading Mommy Millionaire was Kim's brutally honest descriptions of the ups and downs of her business, combined with smart, detailed advice on the various steps involved in getting a venture off the ground. I've taken pages of notes and quotes, and to tempt you, here are just a few excerpts:
"Here’s what I learned from four years at Harvard Business School and a Wharton MBA:
1. Cash is Kind
2. Sell your mother for Cash if you can."
Page 201
"Constantly dealing with a cash shortage at the beginning is not a personal reflection of your inability to run a business; it’s just part of business."
Page 202
"There is nothing more dangerous than a person with…" Read page 264 to find out the answer.
When Kim had a terribly difficult year, ending up in debt and wondering if it was the worst thing that ever happened to her business, she found out it was the best thing that ever happened to her business. Read page 268 to find out why.
One point that came through several times in her book is that every self-made millionaire walks through fire to get to where they are. "Instant success" stories rarely reflect the sleepless nights, the cash flow crunches, the credit messes and the insane craziness of being self-employed.
The only quibble I have is with her advice on page 37 that you should close accounts you don't use to raise your credit score. For the newer Vantage credit scores that may be true, but for FICO credit scores, the most widely used, the advice is the opposite -- leave them alone.
Again, I can't recommend Mommy Millionaire highly enough as a great read for entrepreneurs as well as those who want to start their own business. Once you've read it, let me know if you agree!
Subscribe to:
Posts (Atom)
.jpg)
