Business Credit cards and Commercial accounts

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Business Credit cards and Commercial accounts

Earl McKetty
Rental Property Investor · Bloomfield, NJ · Member since 2019 · 4 posts · 1 vote

We're currently strategizing on how to best establish business lines of credits for our LLC. Cameron's Legacy LLC has completed one fix and flip in Brooklyn NY, manages a 1BR short stay and wholesaling operation in Miami and owns a two family duplex in New Jersey.

We are concentrating on BRRRing multiunit properties in high growth markets nationwide, virtual wholesaling and short stays.

Our lines of credit would primarily be used for a mix of rehab materials, business expenses, business emergencies, wholesaling expenses and cash advances sparingly.

We are a very brand new company, only at this officially since December 2018 and we’d like to do two to three more investments this year. My personal credit is 800 and I have $40K left from a business loan I gave the company. Because we have such a small amount of capital to invest I’d like to compliment it with a goal of $100,000 in combined lines of credit. Specifically a Chase business credit card, Capital One Spark Miles, Business Platinum (AMEX), Lowe’s and Home Depot Commercial cards and a Best Buy business card.

Does anyone have any advice on establishing lines of credit for a new company and only one asset? My concern is applying for so many accounts at one time and the impact it will have on my personal credit. Additionally my credit will potentially be run again for at least 2 to 3 hard money loans this year.

Should I maybe apply for one credit card a month? Should I research the two cards that will give me the highest lines and apply for those? I’d like to have $100,000 in credit by the end of the year. Any insight is appreciated. Thanks in advance for your support.

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  • Scott Mac
    Austin, TX · Member since 2019 · 5k+ posts · 5k+ votes
    7y

    Hi Earl,

    To cut the risk, I'd start by visiting a Chase office and discussing the plan (show it to them as a bulleted list of the credit you want) and see what they have to say. Then go to Capital One and get their opinion.

    As they say, straight from the horses mouth.

    Good Luck!

    0Reply
  • Tom S.
    Real Estate Investor · Burlington, VT · Member since 2010 · 2k+ posts · 1k+ votes
    7y

    @Earl McKetty  Good advice above, going into a branch.  FYI - there's a site called Flyer Talk and a thread specifically dedicated to applying to Chase / Cap One / AMEX credit cards, and it's a good read on applying and in what order.  

    0Reply
  • Earl McKetty
    OP
    Rental Property Investor · Bloomfield, NJ · Member since 2019 · 4 posts · 1 vote
    7y

    Thanks Scott! Will head to Chase tomorrow. Brilliant Tom! Will check it out and let you both know how it turns out. Cheers! 

    0Reply
  • Odie Ayaga
    Specialist · Delran, NJ · Member since 2016 · 2k+ posts · 951 votes
    7y

    Just a heads up...a lot of companies call what they give you a "business" card but it actually reports to your personal credit which you may or may not be okay with. We worked with a company that specializes in securing actual business lines of credit for businesses. I'm guessing what you'll find is that most companies won't give you a true business line of credit since you're so new, but can't hurt to try.

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  • Tom S.
    Real Estate Investor · Burlington, VT · Member since 2010 · 2k+ posts · 1k+ votes
    7y

    @Earl McKetty   Any update on this Earl - how did the branch visits go?

    0Reply
  • Account Closed
    Las Vegas, NV · Member since 2018 · 100 posts · 140 votes
    7y

    With Chase you need to bear in mind their 5/24 rule

    The only business cards that report to personal are Capital One and Discover

    Home Depot and Lowes Commercial accounts i got after a year or so of net 30 payments with the well known suppliers

    If you have a personal Amex account , business cards are usually a soft pull

    Stagger the applications paying attention to which bank pulls which bureau in your state

    0Reply
  • Khai Nguyen
    Greensboro, NC · Member since 2017 · 13 posts · 6 votes
    7y

    Hi Earl,


    The good news about building business credit is that you can get a good business credit score in short period of time and calculated different compared to personal credit score system. However, keep this in mind that for your company to have a credit score, the vendors you work with must report to Duns Bradstreet and other two major business credit score agencies. If they don't, it is meaningless for you and could hurt you since it would impact your personal credit score.

    Another thing to keep in mind when comes to lending is the risk of your company. In real estate, every aspect of any niches are risking to the lenders or the banks who are providing sourcing and may be difficult to get lending or get unfavorable interest rates. A legal strategy to setup your company organizational is to consider setting up a holding company as it is very tax efficient and a quick way to boost your company credibility in a short period of time.

    I hope those suggestions help as building business credit score can be a complicate subject. I hope your real estate ventures go well!

    0Reply
  • Ken Jernigan
    Wilmington, NC · Member since 2017 · 132 posts · 70 votes
    7y

    @Odie Ayaga What was the company you dealt with for business lines of credit? I'm interested in true business lines, not credit cards. Thanks.

    0Reply
  • Odie Ayaga
    Specialist · Delran, NJ · Member since 2016 · 2k+ posts · 951 votes
    7y

    MB Capital Solutions

    0Reply
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