If you are a business owner or entrepreneur, you know how important it is to have access to credit. Credit can help you finance your operations, expand your market, invest in new equipment, or take advantage of opportunities. However, getting business credit can be challenging, especially if you have bad personal credit. Bad personal credit can limit your options, increase your interest rates, or even prevent you from getting approved for business loans or credit cards.
Get Business Credit with Bad Personal Credit
But don’t despair. There are ways to get business credit with bad personal credit, if you know what to do and where to look. In this blog post, we will show you how to get business credit with bad personal credit in five simple steps. We will also explain how our business credit and funding services can help you achieve your goals faster and easier.
Step 1: Understand Your Credit Situation
The first step to get business credit with bad personal credit is to understand your current credit situation. You need to know your personal credit score, your business credit score, and the factors that affect them. You also need to know the difference between personal and business credit, and why they matter.
Your personal credit score is a number that reflects your history of borrowing and repaying money as an individual. It is based on your credit reports from the three major credit bureaus: Equifax, Experian, and TransUnion. Your personal credit score ranges from 300 to 850, with higher scores indicating better creditworthiness. Your personal credit score affects your ability to get approved for personal loans, mortgages, car loans, or credit cards. It also affects the interest rates and terms that you get from lenders.
Your business credit score is a number that reflects your history of borrowing and repaying money as a business entity. It is based on your business credit reports from the major business credit bureaus: Dun & Bradstreet, Equifax Business, Experian Business, and FICO SBSS. Your business credit score ranges from 0 to 100, with higher scores indicating better creditworthiness. Your business credit score affects your ability to get approved for business loans, lines of credit, trade accounts, or vendor financing. It also affects the interest rates and terms that you get from lenders.
The difference between personal and business credit is that they are separate and independent from each other. This means that your personal credit score does not affect your business credit score, and vice versa. However, some lenders may check both your personal and business credit scores when evaluating your application for business financing. This is especially true if you are a new or small business owner who does not have a long or established business credit history.
Therefore, it is important to monitor both your personal and business credit scores regularly and take steps to improve them if needed. You can get free copies of your personal and business credit reports from the respective bureaus once a year. You can also use online tools or services to check your scores more frequently and get alerts for any changes or errors.
Step 2: Separate Your Personal and Business Finances
The second step to get business credit with bad personal credit is to separate your personal and business finances. This means that you should have separate bank accounts, tax IDs, legal structures, and accounting systems for your personal and business activities. This will help you keep track of your income and expenses, avoid mixing up your funds, and protect your personal assets from liability.
Separating your personal and business finances will also help you build your business credit profile. By having a separate bank account for your business, you can show lenders that you are serious and professional about your venture. By having a separate tax ID for your business, such as an Employer Identification Number (EIN), you can register with the business credit bureaus and establish a track record of paying taxes on time. By having a separate legal structure for your business, such as a corporation or a limited liability company (LLC), you can create a distinct entity that can borrow money in its own name. By having a separate accounting system for your business, you can generate financial statements that reflect your revenue, expenses, assets, liabilities, and cash flow.
Separating your personal and business finances may require some time and effort upfront, but it will pay off in the long run. It will help you avoid confusion, save money on taxes and fees, reduce risk, and increase credibility.
Step 3: Apply for Business Credit Cards
The third step to get business credit with bad personal credit is to apply for business credit cards. Business credit cards are one of the easiest and fastest ways to get access to capital for your business. They offer flexible repayment options, rewards programs, expense tracking features, and other benefits that can help you manage your cash flow and grow your business.
However, not all business credit cards are created equal. Some may require a personal guarantee or a minimum personal credit score to qualify. Others may report only to the personal credit bureaus or charge high fees or interest rates. Therefore, you need to do some research and compare different offers before applying for a business credit card.
One of the best ways to find a suitable business credit card is to use our online platform at our website. We have partnered with hundreds of lenders who offer various types of business financing solutions, including business credit cards. You can fill out one simple application and get matched with multiple offers that meet your needs and qualifications. You can also see the terms, rates, and requirements of each offer before accepting it. This way, you can save time, money, and hassle while finding the best deal for your situation.
Step 4: Establish Trade Lines with Vendors
The fourth step to get business credit with bad personal credit is to establish trade lines with vendors. Trade lines are agreements between businesses that allow them to buy goods or services on credit and pay later, usually within 30 to 90 days. Trade lines can help you get access to inventory, supplies, equipment, or other resources that you need for your operations. They can also help you build your business credit history, as some vendors may report your payment activity to the business credit bureaus.
However, not all vendors offer trade lines or report them to the bureaus. Therefore, you need to find vendors who do both, and who are willing to work with businesses that have bad personal credit. Some examples of vendors who offer trade lines include Uline, Quill, Grainger, Summa Office Supplies, and Crown Office Supplies. You can also use our online platform at our website to find more vendors who offer trade lines in various industries. To establish trade lines with vendors, you need to follow these steps:
1. Register with the vendor’s website or contact their customer service.
2. Fill out an application form or provide some basic information about your business.
3. Provide your EIN and bank account details.
4. Request a trade line or net terms account.
5. Place an order using the trade line or net terms account.
6. Pay the invoice on time or before the due date.
By following these steps, you can start building relationships with vendors who can provide you with goods or services on credit, and who can vouch for your payment behavior. This will boost your credibility as a borrower, and improve your chances of getting approved for other types of financing in the future.
Step 5: Apply for Business Loans or Lines of Credit
The fifth step to get business credit with bad personal credit is to apply for business loans or lines of credit. Business loans or lines of credit are more advanced forms of financing that can provide you with larger amounts of capital for longer periods of time. They can help you fund major projects, investments, or expansions that require more resources than what business credit cards or trade lines can offer. They can also help you consolidate debt, refinance existing loans, or improve your cash flow.
However, getting business loans or lines of credit with bad personal credit can be challenging, as most lenders will check both your personal and business credit scores when evaluating your application. They may also require collateral, financial statements, tax returns, or other documents that prove your income and ability to repay the loan. Therefore, you need to prepare well and look for lenders who specialize in working with businesses that have bad personal credit.
One of the best ways to find such lenders is to use our online platform at our website. We have partnered with hundreds of lenders who offer various types of business financing solutions, including business loans or lines of credit. You can fill out one simple application and get matched with multiple offers that meet your needs and qualifications. You can also see the terms, rates, and requirements of each offer before accepting it. This way, you can save time, money, and hassle while finding the best deal for your situation.
Conclusion
Getting business credit with bad personal credit is not impossible, but it requires some planning, research, and action. By following these five steps,
1. Understand Your Credit Situation
2. Separate Your Personal and Business Finances
3. Apply for Business Credit Cards
4. Establish Trade Lines with Vendors
5. Apply for Business Loans or Lines of Credit
you can get business credit with bad personal credit and achieve your financial goals faster and easier. However, if you need more help or guidance, you can always contact us at our website. We are a leading provider of business credit and funding services that can help you get access to the best financing solutions for your situation. We can help you:
1. Improve your personal and business credit scores
2. Find and compare hundreds of lenders and offers
3. Get approved for up to $250,000 in business credit within 24 hours
4. Get funded in as little as 72 hours
5. Enjoy low interest rates, flexible terms, and no upfront fees
Whether you need a small business loan, a line of credit, a merchant cash advance, or any other type of financing, we can help you get it. All you need to do is fill out a short online form and we will take care of the rest. No matter what your credit situation is, we can help you get the funding you need to grow your business. Don’t let bad personal credit stop you from getting business credit.
Apply today and get the money you need tomorrow!