The ABCs of Business CreditLearn why it’s important to establish a business credit report separate from your personal credit and just how to do it.
By David Gass |
URL: http://www.entrepreneur.com/money/paymentsandcollections/article76886.html
As an entrepreneur, did you know you have a unique opportunity to build, maintain and acquire credit both individually and as a business owner? That’s good news if you’re trying to build and grow a company because you won’t have to rely solely on your personal credit to do that.
As a member of the business credit industry, it’s been my experience that fewer then 10 percent of all entrepreneurs know about or truly understand how business credit is established and tracked-and how it affects their lives and businesses.
So let’s first take a look at how personal credit differs from business credit. Then we’ll discuss some steps you can take to build your business credit.
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Corra knows a lot of business owners acquire credit because they are hard working, diligent and intent on using the money to expand their businesses. By far and away, this is the largest group of business owners. These are good people in which to enter joint ventures, partnerships or to rely upon as vendors for your goods and services.
They also make good clients. They pay.
But then there are those who have learned how to work the angles, to boost credit for themselves and their businesses by using questionable and sometimes illegal means to do so. Let’s face it, there are a lot of scammers out there, and this economic climate brings them out of the woodwork.
To assure you are not about to become the victim of some fraudulent scheme, you should perform due diligence on anyone, any business with home you are about to engage. Whether it be a partnership, a joint venture of sorts, or whether you are planning on using them as a vendor or taking them on at a client, it is often wise to conduct business background checks.
Corporate credit checks are important, as are the comprehensive/business partner searches on the key executives and company owners. You may even run criminal and civil checks at well.
Because, if you don’t, there is a chance you could be the victim of fraud. You could lose money and face an embarrassing and even criminal situation.
So check them out before you do business.