How to Establish Credit for a New Company

Business Credit Card

Starting a new business can be a very stressful proposition. Even more stressful is the prospect that you will also have to build credit before you can apply for loans, get business cards, or in some cases even rent space for your business to operate out of. This is why you should never underestimate the importance of starting out the right way in building a good credit score.

Instructions

1. Apply for a business phone line. Not only will this help your business by getting listed in the yellow pages but to get your first consumer card you will need the bill from your business phone line along with your business checking account information to qualify for the credit.

2. Apply for a Staples Card. Take your first bill from your phone line and your business checking account information to Staples and open a credit account with them. Staples is one of the few businesses that will extend you credit without a DUNS number. Charge a small amount of business supplies to your card each month and pay the card off in full before the invoice is mailed.

3. Apply for a DUNS number (the link to the DUNS website is provided below in the additional resources section). Take your DUNS number when it arrives to Staples and ask them to apply the number to your account. Once you have your DUNS number apply to one vendor (examples: Lowe's, Home Depot, Dell, Chevron) each month for the next five months. Be sure that you are making at least one purchase on each card every month and paying the cards off completely each month before the invoices are published.

4. Go to your bank for a credit card. After about six months you should have enough credit to be able to go to your bank and ask for a business credit card. This is also a good time to apply for an ADVANTA business credit card.

5. Apply for a small loan. After about eleven months it is time to go back to your bank and apply for a small loan of about $1,000-3,000 dollars. Do not spend your loan. Request a 90 day repayment period and pay it off in 60 days. The best way to do this is to take the money that you borrowed and place it in a savings account so that you know you will be able to pay it back in time. After you pay back the loan wait a couple of months and then go in for a larger loan of $3,000-5,000. Ask for the same terms and go through the same process as you did with the smaller loan.

6. Apply for regular business credit cards of your choice. By this point you should honestly have close to perfect business credit as long as you have been paying your bills off each month. Take this opportunity to apply for cards that have low interest rates and high cash back rewards. As long as you continue to pay off your bills each month you should be well on your way to a credit profile that any company could be proud of.

Tips & Warnings

• Unlike your personal credit, your business credit is helped by paying off your accounts before the your payment is due. If you make this a habit you will easily keep your credit score high.