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3 Easy Steps To Help You Build Good Business Credit

Do you want to start your own business? Do you have a great

business idea? If so, now all you need is business credit. That

way you'll be able to borrow money against your business without

having to dip into your personal savings or use your personal

credit. This means less risk for you, the owner. Some credit

reporting agencies sell a business FICO score based on both the

risk of the business and the personal credit of the owner. In

some instances, the owner's personal credit is linked to the

business credit, but it's best to keep them separate if you can.

Building your business credit will be completely different from

how you buildt your personal credit rate. You also won't have

the same credit protection with business credit, that you do

with personal credit.

There are certain steps that you can follow to help make sure

your business credit gets off to a great start.

First, you must set up the proper business structure and take

the proper steps to ensure your business appears stable to the

business credit bureaus. That means getting the right

occupational licenses, establish a corporate structure and build

a business credit profile. A business credit profile will help

you to build business credit without using your personal credit.

There are many benefits of having a business credit profile. For

one, you will have more cash for the business, convenience in

purchasing, protection of your personal assets, limiting of

personal liability from the business, and the ability to prepare

your business for future lending needs.

Secondly, you need to borrow or buy products and services from

companies that will report your credit history to the major

business credit reporting agencies such as Dunn and Bradstreet

and Experian. Unlike personal credit ratings or FICO scores;

your income or income potential, will play a huge roll in your

business credit scores. The top FICO scores are reserved for the

largest most stable businesses. But don't be discouraged, with a

little time, your business FICO score will skyrocket!

Next, in order to enter the business credit market, you'll need

to do a business credit assessment to determine if you comply

with the lender and credit bureau's requirements. A great place

to start is to look for businesses that issue credit without the

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need for established business or personal credit checks or

guarantees. Once you have transacted business with these vendors

on credit, you'll be able to use those credit references to

build your credit profile with the credit reporting agencies.

In many states, you can find non-profit organizations and/or

government organizations that will help you with setting up

business credit. There are often loans available for start-up

businesses and sometimes even government grants. Check your

state government web sites for such organizations. Many retired

owners and businessmen will volunteer to help start-up

businesses. By researching your options prior to a business

start-up; you will not be struggling later with questions. With

any luck building your business credit will be a smooth

transaction with a huge net profit for you in the end!

About the author:

If you would like to get more credit information you can visit

our website which contains many credit resources.

http://www.my-credit-report.info This article is copyright

2005, but can be freely reprinted, as long as no changes are

made, including hyperlinks.