7 Steps to Our Ultimate Business Credit Building System:
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- What type of business credit funding will I receive for my business? Cash or vendor lines?
- How much funding will I receive?
- How fast will I receive the funding?
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- Personal Credit Repair
- Comprehensive Budgeting
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- Separate Legal Entity
- Initial List Filed
- Business Address (combine 4 and 5)
- 411 Listing
- Local Phone
- Business License
- Web Site
- Fax Number
- Business Plan
- Bank Rating
- Business Classification Code
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D&B® set up
Steps to Report to D&B®, Corporate Experian® and Corporate Equifax®
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- Funding Specialist
- Funding Options
- Starter Vendors & Applications
- Vendors for Office Supplies, Marketing, Print & Applications
- Vendors for Building & Industrial Supplies & Applications
- Revolving Credit Accounts & Applications
- Revolving Accounts for Office Resources & Supplies
- Revolving Accounts for Building & Décor Supplies
- Revolving Accounts with No Personal Guarantee
- Additional Vendors
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- Certified Business Credit Coach
- Contact information & Hours
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- The 55 Secrets to Secure Business Credit (CA$H) for Your Business AND Keep
- 100% Ownership of Your Company
- The 29 Credit Score and Repair Secrets, Plus 10 Bonus Secrets to Save Your Home
- CEO Scott Letourneau’s “Golden Rolodex” of Business Credit Vendors & Resources
- Business Credit
- Triple Overlap
- Joint Ventures
- Raising Money
- Incorporate Webinar
- Business Credit Webinar
- Call- in-days with Scott Letourneau
What Are The Business Credit Scoring Systems All About?
Experian’s Intelliscore Plus and FAQ’s
The measurement for Experian’s risk model is the Intelliscore Plus. Experian also offers a wealth of free information covering just about every aspect of business credit – from building and improving to scoring, reporting, lending and more.
Equifax’s Small Business Credit Risk Score
Equifax is more secretive about what their commercial scoring model is based on. However, it’s safe to say a large portion of their risk model is based on making timely payments (especially early payments) and keeping your profile free from any open public records, collections, or excessive credit inquiries. The measurement for Equifax’s risk model is the Small Business Credit Risk Score.
Dun & Bradstreet’s Paydex Score®
A business Paydex score is tied to your D&B® business credit file. Like your personal FICO score, it is a statistical measurement of your business’ creditworthiness based on reporting trade references and business creditors. In simple terms, a Paydex score of 75 equates to a personal FICO score of 700. You will need a Paydex score of at least 75 to qualify for most business finance programs without requiring a personal guarantor. In order to reach your goal, you will need to have at least five (5) trade references “reporting” to D&B® that you pay no more than one week slow.
*** Special Note ***
When you first start applying for new vendor credit and new credit card accounts your credit scores will at first go down. This is due to the credit inquiries and because the accounts are new. This is normal and your scores will rise as your good payment histories begin to appear.
A personal guarantee versus a personal credit check: There are some types of financing that will not require a personal guarantee, but at least a personal credit check to see your personal credit score and if you have any major derogatories. This will show up as a “soft” hit on your personal credit profile (an inquiry). A personal guarantee means that if the business defaults on the loan you are personally liable. There is a balance between minimizing personal guarantees and maximizing amount of cash lines of credit. A lender will lend more if you personal guarantee a loan or line of credit to your business.
Cash Lines of Credit. When most entrepreneurs call us looking for business credit to grow they are looking mostly for cash lines of credit as opposed to vendor lines of credit. As you know by now, vendor lines of credit that report to the business credit bureaus are a key part of building a strong business credit score. They help establish the financial credibility that puts your business in a better position to secure cash lines of credit in the future. We have listed the major criteria that go into determining whether your business will secure cash lines of credit now or in the future. This is an OVERVIEW. There are exceptions and options for a start up business.
Here are the major criteria to help you determine if your business is fundable:
• Your personal credit score in all three bureaus.
• Your revolving debt ratio.
• Any major derogatories like a bankruptcy (that is not charged off) or foreclosure.
• Investments in retirement accounts.
• How many years in business (the LLC or corporation)?
• Annual gross sales for the business.
• Annual profits for the business.
• A business plan.
• Monthly VISA/MASTERCARD sales.
• Do you have any accounts receivable?
• Do you have equipment paid for?
• Dun & Bradstreet® business credit score and rating.
• Corporate Experian® business credit score and rating
• Business Equifax® business credit score and rating.
• The number of vendors reporting to the business credit bureaus.
• A personal guarantee vs. a personal credit check.
• Partners in the business
• U.S. owners vs. foreign owners.