Good business credit is important because it allows you to get business loans easily and at lower interest rates. You are also likely to get better deals from your suppliers or vendors. But when your personal credit is poor, it is normal to wonder whether it can affect your business credit. The good news is that you can build business credit even with bad personal credit. It may be challenging, but here are a few steps to help you achieve that.
Apply for an Employer Identification Number (EIN)
If you are yet to, you need to apply for an Employer Identification Number (EIN). It will give you several options when applying for business lines of credit. With an EIN, you can open a business and savings account. Beyond that, have a physical address for your business, open a business bank account and get a separate phone line for the business. All these will legitimize your company.
Use Your Business Credit Card
A business credit card allows you to establish a credit history for the business. Just ensure you pay those credit card bills early or on time. This will lead to a good report. Keep in mind that you may undergo a personal credit check before the approval of your business credit card. So, even as you try to build business credit, improve your personal credit too.
Get a Dun & Bradstreet Number
Dun & Bradstreet Corporation is a credit reporting company that gives information about one’s business credit. You can request a D-U-N-S number for free, then start building your business credit.
Apply for a Working Capital Loan
There are certain loans one can easily get, even with poor personal credit. For instance, a working capital loan can help you finance daily operations and cover some financial needs. If you make timely payments, you will manage to build business credit and still have access to adequate cash flow to run the business.
Check Your Business Credit Report Frequently
Every once in a while, check your business credit reports just to know where you stand. You will easily catch errors or inaccuracies on time and address the issue before it affects your credit.
Even as you try to build business credit, let Crimson Stone Capital Solutions help you. We offer commercial financing solutions to customers through a variety of loan products. Get in touch with us today.