Business Credit Without A Personal Guarantee
Business credit without personal guarantee, is that possible? Of
course it is. Actually that is how it should be done.
So where do you start?
Business credit without personal guarantee begins with a step by
step process that must be followed in order to achieve success. The
first step is forming a corporation or LLC. Next is totally separating
your personal finances and credit from your business finances and
credit. To do this you must get an EIN (Employer ID Number) that
is like a social security number for your business. Then you will
need to open a business bank account in the exact business legal
name as it appears on your corporate paperwork.
Once those things are done you are ready to begin to get your business
credit without a personal guarantee. The place where you start that
is with trade suppliers like your local print shop or office supply.
Many of these will give your business a small line of credit and
payments terms, but make sure first that they will report how your
business pays to the credit bureaus. If not, you are wasting your
time. You will need five such accounts.
Then make sure your business
is listed with all 3 business credit agencies (EquiFax, Dun & Bradstreet
and Experian). Once this is done you are ready to search for business
credit cards and you will need three. Again make sure the business
credit cards are based on your business and not just tied to your
personal credit. Then verify that all three cards report your payment
history.
You should be able to obtain the trade supplier accounts and the
three business credit cards without a personal guarantee. Once you
do you will have successfully separated your business credit from
you personally. Be advised that not all lenders will even consider
your business for a loan without a personal guarantee.
So the best thing to do before you apply is simply to ask!
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