Do bad credit business credit cards exist?

business credit cards for bad creditIf you are wondering if bad credit business credit cards exist, the answer is both yes and no. Yes, in the respect that if you are a business without credit at all, which many lenders feel is equal to bad credit. However, if you are talking about a credit card for a business that has ruined its business, it is likely that your only option will be a secured credit card.

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The exception here is if you have excellent personal credit and you are willing to act as a guarantor for your business credit account. In many cases, a credit card company will offer you a business credit card under those terms. However, you need to remember that your personal credit score will then be tied into your business purchases and payments with your card.

How can I build good credit for my business?

According to Entrepreneur, getting business credit can be difficult. Part of the problem is that many people combine their personal and business credit, which doesn’t do much for their business credit score and is actually bad for their personal credit score.

In addition, you also face the issue of the lack of reporting that actually goes on in the business world between vendors. Most businesses establish a line of credit with another business in order to make a purchase. In a perfect world, the company providing the line of credit contacts the reporting companies to let them know the details of your line of credit and your payment history.

Unfortunately, it isn’t a perfect world and many vendors don’t report your good standing to the credit reporting agencies. This leaves you in the position of establishing good credit with a particular company but not in general.

The way around this is to only use vendors that will report your good standing with the credit reporting agencies. Of course, the downside is that if you miss a payment, this is reported as well.

Establishing good credit takes time. You will find that some companies provide credit cards for businesses with no credit, but they have high interest rates and often require your personal information as well in order to check your personal credit for your payment and credit history.

How do I separate my personal credit from my business credit?

One of the first things that you need to do is get an EIN, which you can get from the IRS website. Getting an EIN is free of charge, but you do need to be aware of your state laws regarding filing taxes with an EIN before you proceed.

Once you get your EIN, you need to ensure that you are properly licensed with your state. You must have a legal business name, which can be your own name if you choose. When you apply for business credit cards, your legal business name will be required.

You then need to sign up with the business credit reporting agencies so that the people who count are monitoring your business information, at the very least. You can file for business credit reporting at the following websites:

Signing up at these companies is free of charge.

While there is no guarantee that this will lead to good business credit, it is definitely a start. What’s more, it makes good business sense for you to establish a separate identity for your business.

What do I do if a business credit card application asks for my personal information?

It really depends on what personal information that they are looking for. For example, are they asking for your name and address? If that’s the case, then provide that information. If they are requesting your social security number rather than a business EIN, then this credit card will be tied up with your personal credit.

There are plenty of business credit cards that strictly use your business information and only request the most basic information about you in order to provide you with a card. If you don’t want your personal and business credit combined, then these are the type of cards you should look for. If you don’t care, then any business card that meets your needs is fine.

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