Since the issue of Business Credit has arisen, lets look at the BACKDOOR APPROACH to re-establishing your credit via use of a legitimate business. As many of you know, Dunn and Bradstreet ( www.dnb.com) is THE business credit rating company. If you have a good Dunn and Bradstreet rating, many credit card companies will approve you WITHOUT a personal guarantee. This is a proven fact that as long as the business has been in operation for 3 years and has a listed phone number the qualification is simple. I suggest: 1. That you register your business as a corporation in your state and that you get a business license in your town. 2. That you set up a phone line in the business name. Also set up a fax and toll free number with VOICE MAIL. 3. That you go to www.dnb.com and request that you be issued a D&B number. Do this only AFTER you have done 1 and 2. 4. That you wait three weeks for the information to post on the state's computers to confirm that you are a valid corporation. 5. That you get an EIN from the IRS for your business. 5. That you set up an account at a local bank in the business name with the EIN. Once you have done these things, you will have set up a legitimate business. The next thing that I would suggest that you do is go to www.staples.com , www.officemax.com and www.officedepot.com and apply for BUSINESS REVOLVING CREDIT. Fill out the application completely and submit it via fax, The numbers are on the websites. Make sure that when you submit the applications that you send a professional cover sheet (with your company logo to ensure you look "corporate") along with a copy of your state corporation document and a copy of your phone bill in the company name. In order to be approved, YOU MUST BE LISTED with THE 411 SERVICE! Once you get one of these cards (the line will usually be 3000.00) you are off and running. 60 days later the payment history will be reported to D&B. Your payment history will be rated on what is called a PAYDEX score and you will immediately start to receive pre-approved business credit cards from Lowes, Home Depot, Associates Business Card, Chevron, Conoco, Citgo, Advanta... and the list goes on. All with NO PERSONAL LIABILITY or Credit Check. I am sure that you have asked yourself.. How did that contractor or business person claim Bankruptcy and 6 months later he is driving a new Mercedes? Can you say "Commercial Lease"? DISCLAIMER... This is not a method to screw your creditors. I am showing you this only because I trust that you will use the information in the "right way" WestCap
The EIN is the Employer Identification Number issued by the IRS to business. I believe TIN is a simile. Just visit the IRS website and the application is live. Remember, you NEVER EVER want to file under any other type of organization other than a Corporation! WestCap
Westcap: How would you suggest that I go about getting my IRs form 8655? In the event that you are not familiar with the 8655 may I suggest that you see § 3.0.258.4 (11/21/97) from the January 1999 edition of the Internal Revenue Manual. Also Chapter 24 of Title 26 of the United States Code (Internal Revenue Code) The Treausury Financial Manual available on the Financial Management Service web page, sections 5512 through 5520a of Title 5 of the United States Code, Parts 202 through 215 of Title 31 of the Code of Federal Regulations, and Part 31 of Title 26 of the Code of Federal Regulations. I think it plainly indicates that without this form (certification) the employer isn't authorized to withhold at the source.
Bill, The main issue is to get the EIN. I am not familliar with the other form but I will look into it. In the interrim, I stand by my post. The EIN is the critical link! WestCap
Great post Westcap. I established CreditWorks with my sister back in 96. We had credit from Advanta within months and soon after from American Express. You can have a corporation without employees, hope that answers the form requirement question. Nevada is considered one of the best states to incorporate. Friendly tax laws and small business regulations. www.creditsense.com
Oh, you won't have any problems standing by your post. What I posted has nothing to do with the validity of your post nor does it attack it in any way whatever. It is unargueably correct. It seems to me that this may be an additional requirement above/beyond what you posted. Make no mistake about it. Your post is as good as a solid steel cornerpost set in concrete. No problem with that. No intent to attack, diminish or disparage your post in any way. Perish the thought.
Westcap: From my personal experience, your approach has worked in some cases, but usually the potential creditor will still want the "president's" or "principal's" social security number listed on the application and they will pull a credit report on both the company and the individual signing the credit application. Although I have obtained a Staples Business Credit Card using your approach via a pre-approved offer in the mail, most creditors will still pull your personal file. What has been your experience with this? Thanks, direct
It is my experience that once the Duns number is issued and once the PAYDEX is over 75 that there becomes no need for officer guarantees. Would the President of Microsoft guarantee a corporate credit card? Absolutely not! This is the approach that you take. The key is to make sure that your info with Duns shows STABILITY. Another word of advice, Call DNB and tell them that you want to have other creditors added to your report. Tell them that you have vendors that you are paying LARGE amounts to on a monthly basis and they are not reporting. For 179.00 they will permit you to send them a list of five additional vendors that they will contact for you and they WILL ADD THE HISTORICAL PAYMENT INFORMATION to your report. Remember that printing buddy that you paid $50,000 to last month? WestCap
Christi, Please excuse the delay in my reply, I have been very busy today dealing with issues presented in another thread! 1. A business license should cost no more than 50-100 dollars. Contact your local chamber of commerce and your STATE web site for more information on the business registration process. 2. An EIN is a TAXPAYER IDENTIFICATION NUMBER issued to businesses by the irs. There is no cost for getting this number and the form is available on the IRS website at www.irs.gov 3. The type of business should not really matter, but I personally would choose a business in the FINANCIAL SERVICES field. These types of businesses are not typically given a credit score, but an employee score, which I personally believe is better. I hope that this has helped you! WestCap!
A few years ago I went to a seminar here in Southern California, teaching info on this exact topic. Well long story short I have a corporation which is now 4 years old and although Iâ??m still on my way up the hill, I can also say that Iâ??ve learned a thing or two. Almost all corporate bank credit cards (Visa MasterCard, AMEX) will ask for someoneâ??s SSN for as a personal guarantee (PG) from an officer of the corporation. Everything posted about D&B is right on in my book but I stand by my issue with the PGâ??s on Credit Cards. Now even though Corporate Cards mainly pull from D&B they are starting to use Exprian Business Reports more often these days. Also a very good thing is that even though banks pull your personal credit, they in most cases (as in 90% of the time) will not post ANY trade line to your personal credit. Because of this fact, I personally know a few people (who went to the same seminar I went to) who were able to raise nearly one million in corporate credit so far. Based on my own experiences as well as theirs I have to warn people that they will be asked to personally guarantee and your FICO will matter just like consumer loans. Also people may want to know that most banks will loan up to 50k with short apps so the key is to NOT request amounts over 50K or then tax returns and bank account checks come into play. In some cases bank personnel will be sent to your corporate offices. And also you need to have a real office location unless you are clearly stating that youâ??re a home business. If you attempt to use a mail drop (Mail Boxes Etc.) as your physical address, D&B will use a cross street directory and within a month or two your D&B reports will reflect that. One thing you donâ??t want to do with D&B is to get caught lying because your account will be flagged. Iâ??m not a pro yet even though I have 4 years experience with all this but I do have friends who are very successful with all of this and Iâ??ve learned a lot about this game. If anyone wants more info: The company that sells Nevada corporations, books and other services on raising corporate credit then check out their site: http://www.repackagingamerica.com/ WARNING: If you buy into this company then just keep in mind that it takes time and you have to have an officer in your corporation with a good FICO score period! Donâ??t buy the hype about raising 100k in 30 days with no PG. IT WONT HAPPEN! I was suckered into this companies TV and radio ads a few years ago but thanks to them I did learn a lot about corporations and corporate credit over the last 4 years. Sure you can get Office Max, Target and other store charge corporate cards with no PGâ??s but you wonâ??t get Bank Credit Cards without a good PG in ALMOST ALL cases.
Won't the IRS expect you to be filing income tax or something? Won't a point come where you have to show bank statements etc? It just doesn't sound as easy as it's being made to sound and in Texas you are looking at over $380 to incorporate.
If you are going to incorporate, you should use Nevada as the state of incorporation. New Jersey is only $50 a year. It is as easy as it is being made out to be. You can incorporate for less than $200.00. Taxes are not as bad as personal taxes, you get to deduct a lot more as a business. www.creditsense.com
What about Delaware? I've heard it's the best. I decided just to incorporate in my home state of Arizona, but my tax guy recommended Del. He said many, many corporations go there for tax benefits/laws.
Yes. Delaware is another very popular incorporating state, just look at where most credit card bills are sent. www.creditsense.com
Just out of curiosity can anything be done with LLC's for credit puroses? I've created a couple for dirt cheap ($50 application fee+$5-20 for public notary + $100/yr for the resident agent) and once you have one it only costs $60 per llc afterwards(you no longer have to pay for a resident agent)
