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The 5 Best Ways to Build Business Credit for Your LLC

Starting a Business with Bad Credit: Expert Tips and Strategies for Success

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If you’re like most business owners, you’re always looking for ways to improve your business credit. A strong business credit score can help you get access to capital, lower your interest rates, and even improve your business’ reputation. In this blog post, we will discuss the 5 best ways to build business credit for your LLC. We’ll also provide some tips on how to apply for credit lines and credit cards for your LLC. So read on!

Register your LLC with Dun and Bradstreet

Dun and Bradstreet is the most prominent business credit reporting agency. Start by visiting dnb.com and creating an account for your company. This will allow your company to begin establishing a credit history. Your creditors will report your payment history and credit lines to Dun and Bradstreet and they will track your history and score. This will help you to establish a credit history for your company. So, if you want to build business credit for your LLC, registering with them is a great place to start. They are known for their reliable business information and can be used by banks, lenders, and other businesses when considering offering credit or lending money.

Apply for business credit cards

Business credit cards offer another way to build business credit for your LLC. When applying for business cards, make sure you look at all of the terms and conditions before making a decision. Look out for perks such as travel rewards or cash back that may help your business in the long run.

In some cases with a new business, you may be required to start with secured credit cards. Secured business cards require you to make a deposit that serves as collateral if you’re unable to pay your bill. If you can demonstrate responsible credit management over time, the business may be able to switch to an unsecured business card.

Once you have transitioned to unsecured credit cards for your business, you will want to periodically ask your bank to increase your credit limit. Of course, you will need to pay your bills on time otherwise the banks won’t be too interested in increasing their credit limits for your LLC.

Pay bills on time

One of the best ways to ensure positive business credit is to pay all business bills on time. This includes credit card payments, vendor bills, and any other business expenses. If you can avoid late payments and maintain an up-to-date account history, this will reflect positively on your business’ credit score.

This credit history will be reported to institutions like Dun and Bradstreet where your future potential creditors will check your LLC’s creditworthiness. So paying your bills on time is critically important to maintaining and building a solid credit history with your lenders.

Establish business relationships

Establishing long-term business relationships with lenders or vendors is another great way to build business credit for your LLC. By forming relationships with these companies over time, you’ll be able to prove that you’re a reliable business partner who pays their bills on time and is capable of honoring their agreements.

These relationships can be as simple as opening a cell phone plan in your LLC name. The vendor will send you an invoice every month and you will get a positive credit history by paying these bills on time.

Depending on the nature of your business, you may need to establish credit terms with suppliers where you pay them on terms like net 30 days. Over time by paying your bills according to your credit terms, your payment history and creditworthiness will be reflected with the reporting agencies like Dun and Bradstreet.

Seek out business financing options

Finally, seek out business financing options such as lines of credit or term loans from reputable lenders to help boost your LLC’s business credit score. This type of financing can help your business grow and provide you with the capital needed to purchase inventory, hire new staff, or make other business expenses.

If you accept credit card payments, you may want to open accounts with Stripe or PayPal. These companies will offer you lines of credit based on your processing transaction history with them. Since they can see your business volume (at least what is charged thru their systems), they will offer you lines of credit that you can use to grow your business.

There are other simple business lending platforms out there also like Kabbage, OnDeck, and others.

By following these steps, business owners should be able to successfully build business credit for their LLC. So if you’re looking to improve your business credit score, these are some of the best ways to do it. Good luck!

About Author

Picture of Rick Mak

Rick Mak

Rick Mak is a 30-year veteran businessman, having started, bought, and/or sold more than a dozen companies. He has bachelor's degrees in International Business, Finance, and Economics, with masters in both Entrepreneurship and International Law. He has spoken at hundreds of conferences around the world during his career on entrepreneurship, international tax law, asset protection, and company structure. Business Anywhere Editorial Guidelines

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