Arizona business financing executives know that bad credit negatively affects new business owners and entrepreneurs. And new business owners usually only have their personal credit to rely on when trying to obtain a loan. Therefore, it is advisable to establish good business credit if you are a business owner or entrepreneur with bad personal credit. While there are bad credit business loans and other finance methods for business owners in this situation, establishing good business credit is still a great idea because it will help you out a lot down the line.
Different businesses need different capital loans and lines of credit, to survive. However, these are dependent on the goodwill or business-credit as certified by the main credit reporting agency Dun and Bradstreet. Arizona business financing professionals state that a few simple steps are needed to set-up a favorable credit profile on Dun and Bradstreet for your business. The first step is to establish your account with them by registering your business on their website.
Get Credit where Credit is due
Apart from Dun and Bradstreet, Arizona business financing specialists state that the other credit reporting agencies are TransUnion, Equofax, and Experian. To establish credit from these agencies, it is best to get a business credit card and start using it for your business purposes. Over a time of using the card and paying the monthly charges on time, you will gradually begin to build up a favorable credit report with each of the reporting agencies. In this connection, Arizona business financing officials state that it is wise to do business with vendors that will extend a net terms account to you, such as 90 or 60 or even 30 day terms. The account activity should be reported to Dun and Bradstreet. To enhance credit ratings, it is advised not to wait until the end of the credit terms for paying off your vendors, but to pay them much before.
A Good Financial Record gets more Credit
Get your account certified by an accounting firm. A clear and properly audited business annual financial return helps to get more credit in the future. It is also beneficial to maintain a good personal financial record, in an approach to build business credit. Although the two are different, a good personal financial credit record improves your trustworthiness and this in turn causes a positive impact on your business credit.
However, bad personal credit does not need to limit you. Phoenix small business investing experts state that if you build good business credit it can help you attain a better loan in the future--and your bad personal credit would not be looked at if you are getting a business loan. Banks seeking some form of personal guarantee for offering business credit will be more willing if the personal financial credit record is good. When seeking out business credit cards, vendor credit, and so on, it is important to choose companies that do not require your personal information and your business information. It is best to clearly draw a line and only acquire these things using your business information.