BiggerPockets

I plant to post some helpful instructions and guide lines that should help you guys who want to establish business credit to do so..this is the first..please forgive me if i leave out anything and feel free to ask questions...

Setting THings Up

Ok.

So now that i am at the point that i want to establish business credit and i realized that my current business won't work i had to set up a new business and ensure that everything it set up correctly for the credit building to run smoothly..

first you want to incorporate. A sole proprietor won't work since the point is to separate the liability. An llc or corp will work but in my research it seems that companies usually give more credit to corps...please understand that this isn't a rule..this is my research...and plus, a corp was cheaper than an llc to set up in fl....lol

Second you want to get your business set up. You need a business phone line at the same address you used for your business inc. and in the same business name with your tax id number. Get your business listed in 411 under your business name. Granted you got your tax id number. :) . http://www.irs.gov/businesses/small/article/0,,id=97860,00.html .. ALL info is on that link for the tax id.

On the address; you can use your address. There are companies that offer virtual office services, try not to use any of those, they tend to be black listed.

With regards to the business phone line, you can get a remote call forward, which is cheaper, under the business name. You will be listed in 411 but in some cases, creditors like to "verify" the business by calling you on the listed number and you calling back from that number. With an RCF, you cannot call back from the number. You can simply get a cell phone and list it in the 411 by paying a fee online. I have not used that service but its possible.

Third is the Duns Number - this is a number that the Credit Bureau (dun and bradstreet) use to file your credit. Many creditors ask for it but some applications may not need it. When calling DNB(defined in the previous post) to get your dnb number, they will try to sell you something. Anything from a credit monitoring service to a credit builder program. If you have money laying around by all means spend the $400+ on a credit building program but chances are, if you are reading this blog you do not have money to waste. Plus it doesn't do much for new businesses.DO NOT PAY.

call 866-705-5711 and state you are applying for federal grants/contracts and you need a duns number. They will give it to you on the spot with no solicitation. You can also apply on their website www.dnb.com which will take 30 days.

you need all your business info to get the DnB Number, including the Tax ID/EIN.

After these steps, comes the ordering of items...

the fun has almost begun.

Great Info Marc....Thanks

Don't forget that your business needs 5 tradelines and paydex just like personal credits.

What are tradelines? (Must pay the company tradeline debts on time to get a business credit from D&B. Score must be 80+ to qualify for a BLOC.)

a. Uline
b. Dell
c. Office Max
d. Walmart
e. UPS/Fedex.

You just tell them that you want to open a business account for your company.

What is paydex? (Your Company must have its own credit cards just like a human). It's like you're creating a live person.

a. Gas Card
b. Visa
c. Amex
d. Discover

Must pay on time.

Also bank and D&B does not like home address or cell phone. You must have a real office, business phone, business email, and business website. Your business phone must be listed with 411 not your cell phone.

Later on D&B will call you for a interview to make sure it is a real company. If you don't answer in your company name, you are doom. Then you have to start all over with a new company name.

Must create a Business Plan to prove bank that you are a good business person so they can give you BLOC for $100,000-2 mil and etc.

Any questions PM me.

i po box wont work
its better to use yoru home address than a PO Box
i also had a couple non-believers to i created a nice little video
:)
check it out
http://www.youtube.com/watch?v=5mH-xwhFsZw

I would go with an actual office (More likely bank would favor a true office not a home office, po box, virtual, or etc.). Last two months I found an office down in Stillwater, MN for $250 month to month lease and it is 300 sq feet.

In order to find your paydex score, you have to pay a small fee with DnB to take a peak of your credit profile. Your paydex score needs to be 80 or above. How to maintain is keep purchasing from those vender, trade lines that you created 1 or 2 times per month, and pay on time. If you forget to use those trade lines then you score will go down. It's similar to your personal credit.

Banks will require a physical address on file for obvious reasons. You can have a po box for mailing, but need to have a physical address on file (even if it is a home address).

PART 2!! PART 2!! :)