How to Acquire a Bad Credit Business Card
by Jake Everett
Credit card companies need to secure their credit loans they give you, of course, and if your company is anything less than a large and established C corporation your personal credit history will be used in the approval process. If this is the case, and you have bad credit, you have a few things you can still do to get a business card. You can get a secured business credit card, a high interest rate card, and you can also work to build up your business credit rating as long as you use the correct cards. This article will explore a few options for getting approved for a line of credit for your business.
Credit card companies need to secure their credit loans they give you, of course, and if your company is anything less than a large and established C corporation your personal credit history will be used in the approval process. If this is the case, and you have bad credit, you have a few things you can still do to get a business card. You can get a secured business credit card, a high interest rate card, and you can also work to build up your business credit rating as long as you use the correct cards. This article will explore a few options for getting approved for a line of credit for your business.
First of all, if you are the owner of a well-established and large C corporation, there's a slight chance you could qualify for a business credit card without having the credit company look into your personal credit history. If, however, your company is new and small, or has a small beginning investment, the business owner will need to have his or her own personal credit score examined before approval for a business credit card and will ultimately be responsible for any debt if the company goes out of business. In addition, if you have a bad credit rating, you'll encounter problems getting approved. If this is the case, you'll need to explore a few options.
The most common way around this problem is to get what is known as a "secured business credit card." A secured card is backed up by a savings account. The amount of money you deposit into the savings account is generally equivalent to the credit limit the company will give you, although some require more and some require less. This way the credit company is insured that the debt will be re-payed. The problem with this of course is that you may need credit for business expenses that you do not have the cash for yet. In this case, you may need to look at high APR cards.
An APR, or annual percentage rate is, like with a personal credit card, the amount of interest you pay on the credit loan if you do not pay back your entire balance at the end of each month. Normal sound credit card hunting involves looking for a card with a very low APR, but if you have bad credit you may be stuck with a high APR for awhile. If you have bad credit, the company may still issue you a card but with a much higher than normal APR, and over time as you repair your credit and build a business credit rating, you will be able to get a lower percentage rate. Building your business credit rating requires one important criteria to be met.
And that is finding a credit card company that actually reports to the main credit bureaus; namely Equifax, Experian, and TransUnion. Your business credit company must report your credit to one of these agencies, otherwise you will never proceed to build a good credit rating for your business. The problem is, there are several cards that do not report to these agencies. For instance, the popular American Express does not. This is fine if you already have good credit and do not need to rebuild it, and AmEx has some of the better reward offers for a business.
So if you have bad credit, first figure out if it's likely for the credit company to investigate your personal credit score. If so, then you need to shop around for a secured business credit card that you can afford and that still allows you to afford what you need for your business. After you do that, make sure it's a card that reports to Equifax, TransUnion, or Experian so you can slowly rebuild your bad credit and eventually acquire a nice low APR business credit card, one that you can use for your company's business.
Credit card companies need to secure their credit loans they give you, of course, and if your company is anything less than a large and established C corporation your personal credit history will be used in the approval process. If this is the case, and you have bad credit, you have a few things you can still do to get a business card. You can get a secured business credit card, a high interest rate card, and you can also work to build up your business credit rating as long as you use the correct cards. This article will explore a few options for getting approved for a line of credit for your business.
Credit card companies need to secure their credit loans they give you, of course, and if your company is anything less than a large and established C corporation your personal credit history will be used in the approval process. If this is the case, and you have bad credit, you have a few things you can still do to get a business card. You can get a secured business credit card, a high interest rate card, and you can also work to build up your business credit rating as long as you use the correct cards. This article will explore a few options for getting approved for a line of credit for your business.
First of all, if you are the owner of a well-established and large C corporation, there's a slight chance you could qualify for a business credit card without having the credit company look into your personal credit history. If, however, your company is new and small, or has a small beginning investment, the business owner will need to have his or her own personal credit score examined before approval for a business credit card and will ultimately be responsible for any debt if the company goes out of business. In addition, if you have a bad credit rating, you'll encounter problems getting approved. If this is the case, you'll need to explore a few options.
The most common way around this problem is to get what is known as a "secured business credit card." A secured card is backed up by a savings account. The amount of money you deposit into the savings account is generally equivalent to the credit limit the company will give you, although some require more and some require less. This way the credit company is insured that the debt will be re-payed. The problem with this of course is that you may need credit for business expenses that you do not have the cash for yet. In this case, you may need to look at high APR cards.
An APR, or annual percentage rate is, like with a personal credit card, the amount of interest you pay on the credit loan if you do not pay back your entire balance at the end of each month. Normal sound credit card hunting involves looking for a card with a very low APR, but if you have bad credit you may be stuck with a high APR for awhile. If you have bad credit, the company may still issue you a card but with a much higher than normal APR, and over time as you repair your credit and build a business credit rating, you will be able to get a lower percentage rate. Building your business credit rating requires one important criteria to be met.
And that is finding a credit card company that actually reports to the main credit bureaus; namely Equifax, Experian, and TransUnion. Your business credit company must report your credit to one of these agencies, otherwise you will never proceed to build a good credit rating for your business. The problem is, there are several cards that do not report to these agencies. For instance, the popular American Express does not. This is fine if you already have good credit and do not need to rebuild it, and AmEx has some of the better reward offers for a business.
So if you have bad credit, first figure out if it's likely for the credit company to investigate your personal credit score. If so, then you need to shop around for a secured business credit card that you can afford and that still allows you to afford what you need for your business. After you do that, make sure it's a card that reports to Equifax, TransUnion, or Experian so you can slowly rebuild your bad credit and eventually acquire a nice low APR business credit card, one that you can use for your company's business.
posted by Duncanz at
5:12 AM
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