Peeps,
I have a newly created LLC, my goal is to slowly start building a credit profile for my company. I checked out the Duns and Bradstreet website and was wondering if getting just a Duns number for free will do anygood in getting small credit accounts from say staples and such?
I was also thining about going with the secured business credit card from Wells Fargo, minimum deposit of 1k?
Anybody have any thoughts?
Jason
If your goal is to buy real estate in a company name and not have to guarentee the loans, then you need to set up and C or S Corp. An LLC is hard to get the type of credit neccessary due to the fact that it is a limited liability Corp.
If your interested, I have a friend that can sell you a shelf corp, they are not cheap and price is based on yrs it is aged, plus he will get you a Paydex score of 80 or 90, I know its the highest score possible, plus you will have 5 credit references attached to the corp as well… total cost is around $7000 I think, but its basically a short cut to what will take 2-5yrs starting your own corp. Plus you will also have a AMEX and an unsecured credit line of at least 50K…
After starting my LLC last year I received several applications for unsecured credit cards in the mail within several weeks. I applied for and received a CitiBank card with a $10K limit.
Regarding commercial bank loans without having to personally sign for them: I was a part owner of a C-Corp (later converted to S-Corp) for about 15 years. We did about $16 million/year of federal government contracts before being bought out by a large national firm. After year 3 in business we never had receivables over 90 days. We had several lines of credit up to $1 million from any one of several banks and every single one made us sign personally for the loans. Not just us two owners, but our wives also. So much for avoiding personal responsability by using corporate business entities.
jmd_forest
Did you receive these this unsecured card by using your personal credit or was it strictly with your LLC?
Jason,
Sorry to say I’m not exactly sure. The application was addressed to my name and the LLC name. Both names are on the card. However, it does seem reasonable that the credit card company would consider my personal credit when issuing the card.
jmd_forest
u have to use personal credit to get biz LOC’s and cc’s other than store cards, net accounts, and Home Depot Mastercard. everything else is gotten with personal credit, and it has to be good.
you CAN get corp credit built in 30-60 days. u don’t have to buy a shelf corp. all those accounts you will get with a shelf corp you can get on your own, with no personal gaurantee. the downside is that there really is no practical use for a lot of them with few exceptions like office depot for office products, home depot for rehabbing, etc. you really need the LOC’s and major cc’s and those you need to have good per credit to get. most don’t even care if your business is a legit business becus they do not check.
go to www.creditboards.com and read up on building business credit.
YES getting a DUNS number will automatically get you a DUNS account, and the business accounts that report will report with your use of the account in order to get u a paydex score. this is all spelled out at creditboards.com
i have done this and it works, in case you all are wondering. you don’t need to pay someone to build your corp credit, or 7 grand for a shelf corp.
Tony
It takes some time to get real credit using a C or S-Corp. Your company needs to show income. Plus if your real goal is to buy real estate, then you will need to show strong company financials to get $200-1mil loans. No company that is 3 months old will really get that. Its pretty hard to walk in a bank and apply for a unsecured business loan on a 3month old company. So there are short cuts to get those loans.
bottom line is that you will NOT get ‘real’ credit like $100k-1mil without a personal gaurantee, or goof per credit. my response was that it’s easy to get corp credit for a newer corp but it’s not very practical kinds of credit. the kind that is easy to get are store cards, net 30 accnts, etc. these are great for running a biz or rehabbing using a home depot card, but it is not the BIG stuff we’d all like. i did not say it was.
BTW your company needs to show income, yes, but most credit that is not a major cc will not ask for financials. and you are right, you will not walk into a bank and get an unsecured business loan on a 3 month old company. if you are approved on an application, it will most likely be approved solely on your personal credit.
For anyone interested in attaining business credit, these two L O N G posts are a great read. If you follow the steps it seems like after a few years you could apply to bank of america for a LOC which the limit can be raised on every few years.