Five Ways to Build Business Credit

Corporate Credit Lines

Starting a new business is like a dream that many individuals are carrying in their minds. Most of them don’t have many ideas about how they can start a new business. A little bit of help from the internet is great for people who want to know about their first step. The best thing is that you can start a new business right from your house with the help of Internet. As you learn more about the business you come across different ideas and terms. Among all the important things that are associated with the businesses, there is corporate credit lines. However, it’s important to build your business credit to avoid last minute hassles. In this article, we will learn about five options to get started.

 

  1. Personal Credit Ratings

One of the biggest factors in most of the bank’s decision to lend money to businesses initially is the business owner’s personal credit history. They specifically check for your personal credit rating. To boost credit score, make sure you pay your bills timely, keep low debt ratio to avail credit on different credit lines and personal credit card. The lenders will often keep a check on the personal credit reports of investors and business partners with more than 20% of business stake.

 

  1. Apply For Credit Before You Feel Need Of It

To build your credit history for the business, apply for at least one of the credit as soon as you start up. Small businesses often have to establish themselves for minimum two years before a bank or any other financial institution feels comfortable offering a credible credit line. There are different ways to get a small bank loan and business credit card. If you have issues securing a smaller loan, consider getting business credit card or store based line of credit with a lower limit. There are some of the major retailers that offer commercial credit accounts build stable credit history of the business.

 

  1. Forge Good Relationships with More Than One Lender

Banks keep on updating lending policies from time to time and can cut your credit limit at any time. You can instead choose to keep your credit card with a major bank whereas your credit line through some locally owned credit union or bank or authorized lenders. Remember, that big banks and lenders can offer services in more locations and more products.

 

  1. Consider Alternatives

Remember that traditional banks are not the only shot at your credit. There are growing options such as secured and unsecured investors; asset based lending which has more focus on collaterals than the credit worthiness. These alternate channels can indirectly improve the chances of getting your credit approved in future. “If people learn about your business and get to know that you are good, it will help you get more funding’s and more business from different fields.

 

  1. Make Payments to Creditors on Time

Every credit bureau uses different methods of crunching corporate credit scores, all of them keep checking on the history of creditors. To ensure good credit score, ensure that your payments are made on time and better if early. The perfect scores are given to those who make payments early.

 

Bottom Line

Building good corporate credit lines can get business credit cards, low-interest small business loans and better terms with the suppliers. It will also help you attract new customers because anyone can check the business credit score to check into your responsibility and trustworthiness. The best way to build your corporate credit is to update your information with established trade lines, credit bureaus, lenders and make early payments. At times, an entrepreneur may find himself under the burden of finding suitable options for the funding. To save your time and keep you focused on other important aspects of the business, organizations like Midwest Corporate Credit offers great help to small business owners to select from different types of corporate credit lines.

 

At Midwest Corporate Credit, we connect business owners with suitable lenders, and meanwhile, we take care of the paperwork. We match offering from lender to small businesses as per the lender’s approval patterns in the database. We take pride in offering 97% efficiency rate. Visit www.midwestcoporatecredit.com for more information and to obtain the funding estimate call us at 630-376-6063.

Advertisements

What Type of Unsecured Business Credit is best for you?

200lenders.png

Whether you have been doing the business for few months or for five years, the access to the capital is an important element for the survival of a business. When the things get tough, your business can shackle unless it has easy access to money on demand.

For all the entrepreneurs, securing unsecured business credit is by far one of the best choices for fulfilling their cash on demand option. The fact that owners want instant access to capital whenever they want at flexible repayment options and at competitive rates.

According to Independent Businesses Of National Federation, “It is like an insurance policy that doesn’t need to be paid back unless you want to.” There are two types of unsecured business credit lines that one should consider: non-traditional and traditional. So how can one determine that which one is best for your company?

The traditional corporate line of credit is issued by banks and it calls for the substantial amount of documents to qualify. For example, information on bank account, personal and corporate tax returns, registration documents and financials etc.

Also when the line of credit is issued, there is a need of financial annual review to maintain the credit line. While the traditional credit line allows different benefits like check writings, it is one of the most challenging business lines of credit to maintain and also to obtain. As per the recent survey conducted by National SBA almost 29% of the entrepreneurs reported to have reduced their line of credit in last five years and almost one in every 10 called in their line of credit early from the bank.

On the other hand, the non-traditional credit line such as business credit cards, unsecured business loans etc is the best business line of credit that any company can receive. It provides easy access to fast cash and gives you payment flexibility with the traditional line of credit without any drawbacks.

Qualifying for such type of credit line is driven on the basis of credit score and it does not require yearly reviews, too much documentation, different level of scrutiny that comes with the bank credit line. Some of the advantages of non-traditional corporate credit lines are as follows:

 

  1. Higher Credit Limits: Business related credit cards carry higher credit limits give more convenient options to finance bigger business purchases. There are many cards that offer 0% APR for the first year of the business set up.

 

  1. Access to Quick Cash: With the unsecured business credit line such as corporate credit cards you can easily utilize as much as lesser credit from the line as you would want anywhere and anytime.

 

  1. True Separation: Corporate credit cards enable business owners to keep their business and personal expenses while benefiting from the credit reports. This makes it easy for the small business entrepreneurs to establish their credit worthiness of their business.

 

  1. Flexibility: With the help of corporate credit cards, you have flexible repayment options as compared to fixed payment on the monthly basis that comes with the business loans. When you tap into unsecured credit line, you have total three options every month. You can either repay the total amount due or pay at least minimal portion of the amount or you can pay more than minimum payable amount.

 

  1. Personal Credit Protection: Business credit cards solely report to the credit report agencies that allow business owners to save their personal rating as well while at the same time they build their business credit score.

 

Non-traditional business credit lines provide flexibility and the convenience that a business needs, but there are few negative aspects as well. One of the major drawbacks is the fact that your business can end up accumulating debt. Without a certain payment schedule, entrepreneurs may be only tempted to pay the minimum monthly payment from their outstanding balances.

Whatever type of unsecured business credit lines you may want to use, it’s important to manage the loan amount responsibility. To get the best financial advice for your new business, Midwest Corporate Credit offers the hassle-free assistance and connects you to right financial products and authorized lenders from all over the America. You can write to us at info@midwestcorporatecredit.com or call (844) 220-8826 to speak to our financial consultant. By giving optimal results to our clients, and understanding the approval models of lenders, we aim to target be the leader in the unsecured business market.

Perks of Using Small Business Line of Credit

features

It’s sad but a real fact that every entrepreneur has faced money crunch at some point of their lives. Maybe a big client promised the check but didn’t deliver right when the payroll time came. Funds, capital or you may call it cash flow is the major lifeblood of all the small businesses. There are various reasons why small businesses could face issues of the cash crunch. That’s why it’s important to have access to start-up business credit through the different small business line of credit. In this article, we will discuss different pros of using a small business line of credit to build your startup business credit.

 

  1. Immediate Access To Capital: When you are facing issues with cash and you also don’t have much time to apply for the business loan. You would need immediate cash. The small business line of credit gives you access to make that amount available for long term needs.

 

  1. Cover Temporary & Seasonal Expenses: Do you have an operational emergency like you broke the computer, any infrastructure concern? The business line of credit will give you perfect backup in case of an emergency.

 

  1. Pay Interest For Only The Amount You Use: When compared to the loan, with business credit lines you only end up paying interest on the money you have used. Whereas, with the business loan you end up paying interest on the whole amount, even when you are not using all the funds at one go.

 

  1. Unsecured: Most of the start-up business credit depends on small business lines of credit that are under $100,000 and are unsecured. This also means your collateral and money stay free and can be used for some other purpose.

 

  1. Establish Your credit history— Small business line of credit also help you in building good credit scores. Building good scores for the business can help you better your chance of getting ” future credits and loan accounts.

 

  1. Peace of mind – Something all the business owners desperately seek for. If you don’t feel any need to draw the amount for any purpose, the thought of having access to the funds as the backup can give your small and busy business owner the great amount of peace.

 

  1. Stay in control: A business line of credit helps you to promote your goals without bearing with the investors, who would like to certain control over your business in return for the financial backing. You will not need to dip your savings or even ask family and friends for money.

Things You Need to Know Before Applying for a Small Business Line of Credit

Before you open any business line of credit, your bank will need to see that you are in the business for minimum 2 years with constant cash flow. Due to this, it gets easy to start up business credit with the same bank you deal with on regular basis.

To apply for start-up business credit, you will be asked to identify yourself along with your business. Also, you would need to explain the type of business ownership, annual revenue, the number of partners and other information about the regular cash flow.

At Midwest Corporate Credit, small businesses have the special place. We have been assisting many entrepreneurs to get the financial aid they require to achieve your financial goals. We offer all types of business lines of credit suitable for different people and different needs that are flexible and convenient to get you access to cash flow whenever you need it. This option allows you to reuse and repay the credit line as required and also simplifies how to track the regular business expenditure.

To find out more about startup business credit and how to apply for the small business credit line with Midwest Corporate Credit, you can call us at (844) 220-8826. You can also mail in your query at info@midwestcorporatecredit.com and one of our financial advisors will get back to you within 24-48 hrs. Visit www.midwestcorproatecredit.com  to check the services and products offered by us and find all the necessary information you need for the start-up funding. We bring you one step closer to your dream of becoming a successful entrepreneur. Call today!

 

6 Alternate Ways beyond the Bank Loans Which Can Help You Raise Capital for a Startup

fbsimplefastfunded

Our present generation entrepreneurs have plenty of ideas for startups, but then capital arises as an issue in the takeoff process. Getting the bank loans is not possible for all startups as there are many formalities and requirements involved in it. Many small business administrations can be approached but even here the competition is increasing. So the question for a person trying to start up a business is ‘how to fund your business?’

This article is about the six alternatives which can help you raise capital:

1. Online Lending Companies

The alternate for the business loans with a high rate of interest are the online lenders. The best thing about these online lending companies is the ease of application for the loan. It hardly takes few hours to fill the application form, and your loan can be passed in a couple of days too. Because of the easy application process, a hassle free and quick achievement of the funds, online lending has been increasing every day and even the former U.S. Treasury Secretary Larry Summers has said that the number will be increasing by 70% in the near future.

2. Angel Investors

The angel investors are known to invest in all startups. They take about 20 to 25 percent of the amount they have invested in your business. Giants like Costco and Google have also risen with the help of the angel investors. It is a very good opportunity for all startups.

3. Venture Capital

Venture capital helps the new startups which can show high growth and also involve a high risk. With this kind of funding, a startup can get a high amount. Through such investors, you can raise millions of dollar which can hep the company grows really fast. The companies doing such kind of investments also guide the entrepreneurs and tell them the success rate of their service or product. The investment has to be paid back in a time period of three to five years.

4. Invoice or Factoring Advances

This process is very helpful for a startup who has been working for customers already. The funds are provided in advance to these startups on the basis of the outstanding invoice of the customers. The amount is paid back when the customer pays back the money. This helps the startups as the important work and operations do not come to a halt.

5. Crowd funding

There are many sites which help the startups get crowd funding. Crowd funding is done by various investors who can pool in small investments. The sites who do crowd funding contact these people who are willing to make small investments and create a good amount for a startup. This is helpful for you if you are not getting an investor who can raise a huge capital. Before opting for this option you must read the terms and conditions of different investors on the crowd funding website.

6. Grants

The government provides funds to the different businesses which are focusing on a startup related to science or some research. The grants are offered by SBA with the help of Small Business Innovation Research or the SBIR and Small Business Technology Transfer (STTR) programs. If you are looking for grants like these from aided by the government, your business must have a high potential for the commercialization and be able to meet the standards of the federal research-and-development.

Getting loans from the bank might need a number of formalities to be fulfilled and the business loans also charge a monthly return on the amount of the loan. These tips should be helpful on how to fund your business. With Midwest Corporate Credit you can get help as we connect you to a large network of authorized lenders from all across the America and which will be able to match your requirements. We filter the client base as per the previous approval patterns and give you hassle free credit approval. Visit http://www.midwestcorporatecredit.com to know more about the products and services. You can also call us at (844) 220-8826 to speak to our financial consultant and get a perfect solution to how to fund your business in no time.