Credit experts advise that you control your business credit if you hope to experience growth in the coming months. Once you have built up your business credit, vendors and customers will feel more comfortable doing business with you. Lenders will deepen their pockets and investors and shareholders will enthusiastically jump on board. For your big entrepreneurial dreams to come true, you will want to build your business credit using the advice listed below.
Establish Credit
The easiest way to build up your business credit from scratch is to secure a credit card in your business’s name. Or if you have a business account with a bank already, apply for a line of credit. Securing a card or line of credit that is strictly for business purposes will accomplish two primary goals.
One, you will finally establish your business credit. Now anytime creditors, vendors or even customers who check up on the credit status of your company will know that you are reliable and trustworthy. It is up to you to maintain this positive level of credit, and to possibly outshine the majority of other business owners across the country.
The other reason why a card or line of credit is a good idea is because you will be able to keep your business and personal expenses separate. This makes tax season easier and it also allows you to spot problems much more easily, since your expenses all originate from a single account.
Accountant or Accounting Software
To properly build up your business credit, you should be able to have your credit information at your fingertips anytime you desire. An accountant will keep your finances straight and tax season is barely an afterthought when you have an expert controlling your business credit.
On the other hand, accounting software, as long as you keep up with it, is also an invaluable tool when attempting to control your business credit. Some software programs allow you to connect directly to your bank account for automatic account updating, and some you will have to update manually. At any rate, accounting software will allow you to control your business credit and maneuver around tax time with few headaches.
Pay Your Bill
For you to build up your business credit and keep it in good standings, you need to keep your debt to income ratio as low as possible while maintaining at least some of your balance. Pay your bill regularly and watch out for interest charges. An accountant should be able to give you excellent advice related to credit payments and how to avoid high interest rates, and software will allow you to break down your payments so that there are no surprises. You are said to be in control of your business credit when you know exactly where your money is going, who you owe, how much you owe and what your credit score is at all times.
Repairing Business Credit
If you already have business credit but, for whatever reason, you seem to have fallen out of favor with the three major credit bureaus, it’s time to get your business credit back on track. Start by paying the smaller balances that you owe first. No matter how much you can pay, just start sending money to the smallest amounts of the bunch. When the smallest is paid off, attack the next smallest and so on. This process will build up your business credit over time, as long as you give it the proper attention. When you have better control over your business credit, you will be able to take more chances, secure more business and have better chances of reaching your goals than businesses that allow their business credit scores to drop indefinitely.
Whether you are just now building business credit or you are repairing your credit after some time of abuse, this is definitely a good year to be doing it in. With the economy in an upwards swing and with more companies using business credit to gauge potential relationships, big things are sure to come for you and all ventures that you back.
Now start putting your plan into action. Secure a credit card or line of credit, get an accountant or an accounting software and control your business credit right down to the very last cent. Good business requires good credit and both are soon to be within your grasp. What does your business credit score look like? To find out, contact one or all three of the major credit bureaus and get started establishing or building your business credit in the New Year.
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