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Tips and Tricks to Build Business Credit Fast

One of the most important steps you can take for your business is to build business credit fast. The good news is there are some steps you can use to fix bad credit fast. Here are some tips and tricks.

Register your business

If you have not already done this, you need to do is as fast as possible. Make sure your business is registered as a separate legal entity from you. This will mean it is either incorporated as an S-Corp or LLC. A good idea would be to seek advice from your business advisor. After this, you need to apply for the Employee Identification Number (EIN) using the IRS website.

Open a bank account for your business

This can go a long way in helping you to separate your business and personal financials. You can use the account to take care of the business expenses including your salary as long as you deposit in a personal account. When applying for financing, many of the lenders would like to see the data from your business, and this can help them make the decision.

Get a phone number for the business

You can choose to use VoIP, cell phone or landline. However, you will need to have a separate number for the business. Ensure the number has been listed so that it is easy to find it.

Confirm if you have been listed in the credit bureaus

After the business is legally registered, you will need to confirm if it has already been listed with the 3 major credit bureaus. Many of the lenders use one of the 3 major credit reference bureaus.  These bureaus usually get their information from the public records and this information is sent to your lenders and creditors. This is usually the same way your credit profile is usually populated.

Ask for a line of credit from suppliers and vendors 

You may already have established some good relationships with your suppliers and vendors. Consider the companies that you do business with on a daily basis such as Home Depot, UPS, FedEx, Staples and much more. You should then request them to extend a small amount of credit and many of these will. This is important as they also want to maintain you as their customer. However, you want to ensure that they send the payment history to the business credit bureaus. This is usually reported voluntarily. The goal is to establish 4 or 5 of these account types to assist you in establishing the credit report for your business.

Open a credit card for your business

In case you are using the personal credit card for paying for the business expense, this should be the time to stop. Make sure that you open the business credit cards that should not be tied to you personally. Ensure that the report to these business bureaus has been verified while you are applying. Many of the business cards can include cash back programs and travel points. This is money that you can use for reinvesting into the business.

Pay bills on time

Unlike the case with personal credit, when you got 30 days for making a payment before it affects your credit, this can cause your business credit score to go down if you are late with one day. In fact, if you want you to get a perfect score, you need to ensure that you pay all your bills on time. It can also help to ensure that you pay the business utility bills on time. With these tips, it will be possible to build business credit fast.

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