About six months after being decline for a Citibank business credit card, I decided to try again. By that time I had eight positive trade lines reporting on my business reports, and over a year of business history, so I thought that I might be approved, based on my positive business credit. Once more they pulled my personal Experian credit report showing those old late payments.
Oh! Brother! Another Experian ding.It was around this time that I began to imagine a personal vendetta between Experian and my business.
My business credit reports were never looked at. I had been wishing and hoping that if they did pulled a personal report again, that this time around they would pull Transunion or Equifax, which is blemish free.
No such luck.Many of us when starting out are eager beavers. We want everything, now! Now! Right now! So did I, when I first started out. After being declined for a Citibank business credit card for the second time around, I had the gumption to immediately go and apply for American Express “Business Line of credit”. And guess what happened? Yep! I was declined, and guess the reason why? Yep! Two old late payments. Guess what credit report they pulled? Right again: Experian.
"Thank you for your recent application for the American Express Business Line of Credit: We do value your desire to establish a relationship with us. We regret that we are unable to approve your request for the following reason(s):
Your consumer credit bureau score from Experian is too low Your American Express Acquisition Risk Score is too highStill, there was no stopping me; somebody is going to approve me. I then went ahead and apply for an MBNA Loan. (This loan is no longer available)
and guess what happen?...........
This is foolish, just blindly applying for credit, ignoring the fact that you do have a problem with one of your credit reports. Building up unnecessary inquiries. STOP! Get it fixed, before going further.
This may be true with net 30 accounts and business store cards: Computer equipment companies, such as Dell, and other equipment companies, as well as certain leasing situations, and some entrepreneurs have gotten cars using their business credit only. All very possible. So the answer is yes!
However, as far as getting cash, my personal credit reports were always accessed before a decision was rendered for approval. With the exception of two business credit cards, one of which is the Home Depot Mastercard, and the other is Key Bank Mastercard, which at the time I had applied did not check your personal credit reports. They only pulled your business credit reports and approved or declined you based on it.
Getting cash money dollar peso is a different animal. You would need at least two out of three of your personal credit reports to be in tip-top shape. We’re talking about at least 700, 720 and 750 would be ideal.
Beyond that information, your Debt to income ratio and Credit Utilization are factors taken into consideration before a decision is rendered. Be careful; we are paddling into the white water rapids. This will require careful maneuvering.
The next business credit card I had apply for was Home Depot Mastercard, I’d had my Paydex 80 for a few months with about eight accounts reporting, with 3 of those accounts having a payment history of over 90 days. I was approved over the telephone for six thousand dollars, after speaking with an underwriter.
Three months later I applied for the Home Depot business card and was approved for 4k. Several months later I called in for a credit line increase for my Home Depot business card and they asked me what I wanted. I told them 3k more; she left the phone briefly and came back and said she could give me and additional 6k, making my total credit line now $10,000.
This was magnificent, as they provided me with more than what I had asked for. Also, this would now be my largest trade line reporting on my business credit reports. I can only get larger amounts of credit from there!
It was terrific that I now had a substantial $10,000 limit now reporting on my business reports. I immediately went and purchased some tax deductible items for my home office. And, most importantly, I diligently made sure that I paid more than the minimum payment and well before the due date every month.
About a year of having my Home Depot Mastercard, I tried to get a credit line increase but was declined. The underwriter stated that she saw I had been only paying down debt, not making any purchases for the past several months. They wanted me to continue incurring debt and paying it off responsibly. I was advised to call back in three months. So, I went shopping!
A couple of times previously when I had applied for personal credit, one of the main reasons for the decline were because of limited personal credit history. If you’re in your thirties or forties and have a personal credit history of less than five years, that is considered light credit and your credit score will reflect that.
So to remedy this, my husband had a personal Sears card with over 10 years of perfect payment history. I asked him to add me to his Sears account as an authorized user; he obliged and added me to his card as an authorized user. Once the Sears account hit my personal credit reports with the 10 years of age, my credit score jumped between 30 to 50 points on all three reports. This is a common practice, and I have learned that many parents add their children onto their accounts helping them to build a strong credit history.
Over the last few years, there has been a lot of discussion about authorized user accounts. You had many businesses pop up offering you a way to purchase someone else’s good credit history as an authorized user. FICO got involved and said that they were creating a new model where authorized user accounts will have little effect on one’s personal credit score. As of this writing July 2009, authorized user accounts are still valid.
My personal credit score was roughly 670, 682, 690. After the authorized user account was added to my personal reports, all my scores jumped to the 700’s. I decided to go on an application spree, applying for four different business credit cards all at the same time, one behind the other, online.
I applied for US Airways business card online and was instantly approved for 9k. I applied for Quicken business card and was instantly approved online for 9k. Chase business card approved me for 10k over the telephone.
Bank of America approved for 10k over the telephone
All in all though, a very successful day!
I had accumulated $38,000 in about 60 minutes, not bad. For your information, after six months of using previous business credit cards and paying promptly to enlarge my “paying field”. I had zero balances and decided to call each company and request credit line increases.
Key Bank approved me for and additional $5,000, making my total line $9,000.Discover business card services approved me for and additional $6,000, upgrading my credit line to $15,000.
American Express gave me an additional $6,000, making my credit line $15,000.
Another $17,000 in under an hour. YES!
In early 2007, I stumble upon another business credit forum which is spectacular, named creditboards.com. A member of this credit forum was explaining that she had constantly checked her credit reports (on a daily basis) to see if changes that she was expecting were actually being made on her credit report. She said that she noticed that her inquiries from TransUnion and Equifax would fall off.
If you have three or more inquiries on your credit report, many financial institutions will reject you for credit because of the number of inquiries.Pulling one’s credit report daily in order to get the inquiries to fall off, is called Bumpage or “B”. To use Bumpage or “B” you have to get a tri-merge credit report from a vendor who allows daily pulls of your credit report. Some do, others don’t. I decided to be ambitious and applied for a tri-merge credit report with three different vendors for the purpose of Bumpage.
This only works with TransUnion and Equifax. I had ordered three tri-merged reports from three different vendors: American Express credit secure, Chase identity guard and Credit check total.
I began to pull each one once per day, that is three pulls daily. After about six weeks, I noticed that my TransUnion report that had four inquiries now had three, and Equifax that had five inquiries now had four inquiries. I continued to pull my credit reports until all the inquiries vanished. At which point I stop the daily pulls. This took about six weeks for me to accomplish.
After my mini-application spree resulting in 5 out of 6 approvals, I was content and done for now. I spent the next few weeks restarting Bumpage or “B” to get those excess inquiries off of my credit reports.
Equifax allows you to call them up on the phone and dispute the inquiries; they will do an investigation. Usually one or two days later the inquiries will be removed. Or while your doing “B” for transunion, it will also bump for Equifax.
Experian will not allow you to dispute any inquiries from your credit report, period. And there is no “Bumpage” with Experian.
Fortified by my success, I went ahead and applied for the Frontier business credit card. With my heart skipping a beat watching the computer screen saying “processing please wait” I was overjoyed with an instant approval online for 12k.
Frontier and US Airways are from the same bank, now you cannot apply for both cards. Only one. After using both cards for several months a customer service representative called me and told me that she was closing my Frontier business credit card. This was because their current policy allows business owners to have only one of their business cards.
At this point your business is established with at least a 90 to 120 days payment history with four or more accounts reporting. What you want to do is apply for 2 or 3 business store cards, but make sure that they are cards your business can use.
• Staples
• Home depot commercial
• Amazon
• Office depot
• Shell gas card
Some Business store cards requires two years in business such as Best Buy, so make sure you check before applying. Below is a list of business store cards to get started.
Office Depot – office supplies www.officedepot 800.go.depot Staples – office supplies www.staples.com 800 378-2753 Amazon - online retail www.amazon.com 866 216-1072
Home Depot www.homedepot.com 800 553-3199 Target - www.target.com 800 591-3869
Macy’s - www.macys.com
Exxon - www.exxon.com 800 903 9966
Texaco Gas Card – www.texaco.com
Dell’s computer equipment www.dell.com 800 www dell
Below requires two years in business before you can apply Best buy – outlet center www.bestbuy.com 888 237-8289 I applied with Swift financial for a business line of credit and was decline due to their pulling my Experian personal credit report.
Reasons: Delinquent past or present credit obligations credit not granted on terms requested.I still needed to learn my lesson.
My business credit reports were impeccable, I had the two years of age in business that they had required as well. Jeez!
After being decline for two late payments reporting on my personal Experian credit report four times and having being decline also for too many inquiries on my personal Experian credit report. I decided to “deep freeze” my Experian credit report.
I called Experian to find out how does one goes about a credit freeze. I was told this need to be done by certified or express mail. It cost $10.00, depending on what state you’re in. I was sent a pin number to use whenever I decided to unfreeze my account. That will probably happen when “you know what” freezes over.
After the freeze took effect, I applied again with Advanta about six months after my first decline. For the second time, I was declined again.However, this time the reason was that they were not able to access my Experian credit report.
So, with a credit freeze on your credit report and you apply for business credit one of two things will happen if they pull the report that has the security freeze on it.
One - They will pull one of the other two reports or
Secondly, they will outright decline your application for credit or ask you to unfreeze it to be considered.
If your business is relatively new, only several months old or less, there is no point in going to the bank talking about business loans. One of the things they will do is access your business credit reports to see which creditors have already extended credit terms to you, your payment history, how long you’ve been in business, your highest trade line, etc. You haven’t established a track record here yet. So, what’s the point?
A better idea would be to take out a personal loan. However, only do this if your personal credit score is over 700, with no more than two inquiries on each report, and of course you need to show “income” that you are able to pay this loan back.
I’ve seen young businesses get approved for business loans because of their excellent personal credit.One of the largest personal credit lines I’ve received was a personal line of credit from Citibank. That was before I had applied for their business loans. Online I was instantly approved for $32,000. I nearly felled out of my chair in disbelief.
How ironic, I thought, I’ve been trying for months to get a Citibusiness credit card for 25k. Instead, I got approved for Citibank personal line of credit for even more. This probably explains why when I was subsequently approved for a Citibank business loan and two business credit cards the limit was very low. They see that big fat 32k sitting on my personal credit report, and all the other business debt I’ve accumulated.
The personal credit line, I’ve used exclusively for my business.The other option would be for you to apply for several personal credit cards. Hopefully, this will be enough funds to get your business moving forward. Loan the funds to your business and make sure you pay yourself back.