Building Good Business Credit After Bad Credit

Can you establish good business credit if you have bad personal credit? The answer is yes...but with a few caveats.

Business credit reports and personal credit reports are generally completely separate databases for legal reasons. However, there are some exceptions in terms of how independent that information may be:

-- If you are operating as a sole proprietor or Limited Liability Company, it is difficult to separate your personal and business credit. A corporation is a much better structure to build a completely independent business credit report.

-- Experian sells a credit score that is a combination of the business owner's personal credit history and the businesses' credit history.

In the early years of a business, the owner will almost certainly be required to personally guarantee loans. However, as you establish a strong business credit rating for your enterprise, you'll have more leverage to negotiate for a loan without your personal guarantee.

A warning: some people try to use business credit file to repeat bad credit habits.

"I've seen people who ruined their own credit go out and start a business, enlist the help of people with good personal credit to be executives in the company, and get major credit cards. They didn't have a real product or service, and the objective was to just get credit. They would inevitably default on the corporate credit lines," says Erik Salmon, Director of Business Credit Services for Innovative Business Services (IBS) and an experienced business credit coach. If that's your intention in establishing a business credit rating, you're better off taking some personal finance courses to learn how to manage your money.

If, however, you legitimately want to make a go of a business, have a solid plan, and are willing to do what has to be done to get it off the ground, then you should let a bad personal credit rating stop you. Building or rebuilding good credit - whether it's personal credit or business credit - is a process. Be patient as you work on both your personal and business credit. The results will be worth it. For more information, visit www.businesscreditsuccess.com.

Gerri Detweiler is considered one of the country's top credit experts. She has been interviewed for thousands of radio, television and print newstories including USA Today, The Wall Street Journal, The New York Times, Dateline NBC and many others. She has testified before Congress several times and worked on reform of the national credit reporting laws.

---

Credit Trap: What They Dont Tell You About Credit Cards In College

In industrialized nations, going into debt starts early. It's easy... Read More

The Ghost of Expected Surprises

Here, Cratchet, what do you think you're doing?Uh, er, leaving... Read More

Save Money and Lower your Payments by Improving or Repairing Your Credit

Having a better credit score not only represents easier access... Read More

Inflexible Friends and Plastic Assets, Why Money isn?t Buying Love Anymore

Consumers reject financial advice in favour of financial frivolityIt would... Read More

What Is the Fair Credit Reporting Act and What You Should Know About It

The Fair Credit Reporting Act (FCRA) and the recent update... Read More

Credit Card Traps: How To Spot Them On The Spot!

They arrive in your mail - a conspicuous looking mail... Read More

Defeating Credit Card Debt With Self Control

Credit card debt is a major social problem in some... Read More

Grants, Loans, Free Credit Cards And Credit Repair: The Whole Truth And Nothing But The Truth

You got creditors calling you everyday. You could lose the... Read More

How a Credit Card Can Be Your Friend

We have all heard countless stories of people over their... Read More

Finding and Applying for the Right Credit Card Offer Online

Anywhere you go online nowadays, you will see a multitude... Read More

Identity Theft - Dont Think You Are Immune

As identity theft becomes more prevalent, the need to regularly... Read More

Finding What is on Your Credit Report

A credit report is basically a file about you kept... Read More

Credit Cards or Store Cards - Which Is Better?

Introduction In this article, a presentation is made of the... Read More

Credit Help for Real Estate Financing: Credit Scores

When you buy real estate, lenders run all of the... Read More

What You Need to Know About Interest Rates

For all people shop around for the best rate, there... Read More

Stop Struggling Because Of Poor Credit And Improve Credit Rating Now

Did you apply for a personal loan only to be... Read More

Why Does Your Credit Card Rate Keep Going Up?

Have your read your credit card contract through completely? Do... Read More

Which Citi Mastercard Is Right For You?

You've decided to apply for a Citi MasterCard, but with... Read More

Credit Repair Myths and Facts

There are no secrets to repairing your credit. Many shady... Read More

Beware of Bogus Credit Repair Companies!

So-called "credit repair" companies claim they can remove negative information... Read More

Credit Reports Inside and Out

The Credit Report is like your scorecard in the lending... Read More

Sound Advice For First Time Credit Card Users

If you are just entering the world of credit cards,... Read More

Lower Your Credit Card Interest Rate Now!

With today's credit card companies, there are many opportunities to... Read More

To Repair Credit Is No longer Satisfactory - Learn How To Earn A Millionaires Credit In 30 Days...

To repair your bad credit does not necessarily mean that... Read More

Credit Cards, Merchant Accounts, and Your Bottomline

Q: I'm opening a gift shop and want to be... Read More

How To Start A Second SEPERATE Credit File!

Your personal credit file is separated from those with the... Read More

Consolidating Credit Cards

Credit card consolidation is a popular solution for those with... Read More

10 Tips To Prevent Credit Card Fraud

Imagine opening your credit card statement one morning and discovering... Read More

5 Steps You Can Take to Get Paid!

There are always some companies that have past due invoices... Read More

How To Avoid Becoming A Victim of Identity Theft

With identity theft statistics currently at an all time high,... Read More

Student Credit Cards 101

Almost all students have and use student credit cards. Some... Read More

Do You Know Whats On Your Credit Report ?

It is important to know your credit rating for a... Read More

Commercial Collections: Business Finance Booster Shot

Commercial collections: fixture of the new B2B cultureIf you're in... Read More