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Build Your Business Credit Profile

If you want to borrow money without you needing to guarantee the loans personally, you need to build your business credit. It is important that you are taking steps to build your business credit profile.

You are here: Home / Financing / Build Your Business Credit Profile
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October 4, 2010 //  by Isabel Isidro

business people sitting

.If you want to borrow money when you need it — without you needing to guarantee the loans personally — you need to build your business credit. It is important that you are taking steps to build your business credit profile.


According to Dun and Bradstreet , below are ways you can start building your business credit profile even before you open your business:

  • Establish your business as a separate entity to separate your business credit profile from your personal credit profile, such as corporation or limited liability company
  • Establish a viable business on paper, including having a written business plan and all the necessary licenses and permits needed for the business
  • Do a credit assessment and find out exactly the requirements for both lenders and credit bureaus to know what standards are expected.
  • Start making purchases for your business from vendors who will let you establish credit based on your personal credit background and report your transactions to the credit bureaus
  • Entice vendors to give you a line of credit, and one way is to have your business backed by investors as it sends a signal that there are people who are confident about the prospects of the business
  • Get loans from state or national business associations, such as the Small Business Administration, and pay these loans back on time.
  • Pay within the set terms of suppliers
  • Make sure to work with suppliers who are reporting your prompt payments
  • Try to limit the number of inquiries regarding your credit profile
  • Do not overdo it with business credit cards — have a couple, not a dozen
  • Do not let licenses or registrations lapse — make sure you’re on top of renewals or obtain any new licensing that you’re expected to have for your business operations
  • Maintain thorough, up-to-date financial records

Something fairly common among the micro businesses and home-based businesses, the article “Building Business Credit” warns small business owners not to:

Don’t try to get business credit as a substitute for bad personal credit. If you have damaged personal credit, work on rebuilding it while you’re building business credit.

Similar Posts:

  • 5 Ways a Line of Credit Supports Your Business
  • 80 Questions to Ask When Starting a Business
  • 10 Things to Do Before You Quit Your Day Job
  • How to Start an Online Business
  • 40 Tips on How to Use Crowdfunding to Raise Money for Your Business

Filed Under: Financing Tagged With: Managing Finances, Startup Financing

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