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Private Business Lenders

What are Private Business Lenders and Private Business Funding?

Real estate investing is big money. But not every entrepreneur qualifies for loans from big banks, and other traditional sources. Not to worry, there are private lenders out there, willing to lend money. Private money business loans just might be the solution you’re looking for – from private business lenders.

What are Private Business Lenders?

Private business lenders are generally funded by investors, or by banks, or both. Private lenders are in the business of taking funds from private investors. They make private business purpose loans with those funds.

Investors expect a decent return from their investments, and interest rates from money borrowed from banks is significantly higher, than the banks are being charged for the funds. These factors raise the private lender’s expenses. Those expenses are then passed on to the ultimate borrower. Unlike with angel investing or venture capital, the borrower isn’t giving away a percentage of ownership.

Why Work with Private Business Lenders?

Apart from possibly not qualifying for traditional lending, there are other reasons why it may be better to work with a private lender. Banks are often tougher to deal with than private lenders. Banks are subject to significant state and federal regulations. They must work within governmental and quasi-governmental agency programs, like Fannie Mae, Freddie Mac, the VA, and HUD. These regulations often dictate which businesses a bank can lend to, and what borrower profiles should look like.

Private business lenders, while still subject to state and federal laws, are significantly less regulated. They can be more flexible in the types of loans they make, and who their customers are.

Hence is it generally easier to get approval from a private lender, versus a traditional bank. Private lenders can customize each loan based on a set of internally set criteria, like credit scores, loan to value ratio, and debt to income levels.

Learn business loan secrets and get money for your business.

Bank Approvals are Different

In contrast, bank approvals are program or computer driven. The lender only has a little discretion. Private lenders tend to take a more common sense approach, to understanding borrower issues and overcoming them.

Banks tend to look at financial histories and credit through easily traceable and documented income sources. This makes it very difficult for self-employed borrowers, for example, to qualify for bank loans.

Private lenders will be more creative, and investigative in qualifying income. They may be willing to overlook background flaws upon explanation. See rehabfinancial.com/real-estate-investment-strategy/financing-real-estate-investments/private-lender-vs-a-bank-mortgage.

Consider Private Lenders and Hard Money LoansPrivate Money for Business Credit Suite

A hard money loan is a type of real estate loan. It is issued by a private lender for non-owner occupied property. Hard money loans are usually short term. They tend to be between six and 36 months. They have a higher interest rate than traditional bank loans.

Let’s look at Hard Money Loan Approvals

You get approval for hard money loans based on the value of the real estate, rather than the creditworthiness of the borrower. These loans are often used because they have an exceptionally fast approval time. They are often closed within two to four weeks.

What is the Difference Between Hard Money Loans and Bank Loans?

The main difference is the lender. Hard money loans are almost always given by a private lender. This is so whether that’s an individual or a private lending company. These loans are used for non-owner occupied real estate. So they aren’t regulated like consumer mortgages. As a result, hard money lenders can charge higher interest rates and fees, and they can get away with terms that wouldn’t be allowed with traditional loans.

The Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act (RESPA) don’t often apply to commercial mortgages. But there are still regulations traditional financial institutions must follow. Federally insured banks are still regulated by the FDIC. Credit unions are regulated by the National Credit Union Administration (NCUA). But hard money lenders don’t have any regulations placed on them.

What Sorts of Real Estate is Covered by Private Money Financing?

A hard money lender may loan on any type of non-owner occupied real estate. This includes all sorts of real estate investments. But they’re often looking for situations with a fairly quick exit strategy, so they know they’ll get paid by the end of the loan term.

Let’s look at Private Small Business Loans for Fix and Flip Properties

Hard money loans are very common with fix and flip properties. In fact, many lenders will even finance the repairs. These types of deals are ideal for the lender because flips tend to be completed within six months.

If the lender is also financing the repairs, they will estimate the cost of the repairs, and issue draws as the borrower needs them to pay for the work being done. This ensures the funds are being used for the repairs. It also limits the lender’s exposure, since they’re only giving out a small amount of money at a time.

Learn business loan secrets and get money for your business.

Check out Hard Money for Repairs

Many hard money lenders prefer to finance the repairs. This way, they know the project will be completed. If the borrower gets through the demolition and runs out of money, the value may become less than the purchase price. By financing the project, they don’t have to worry about the borrower not being able to finish the job due to a lack of funds.

Consider Hard Money for Rentals

Hard money lenders will also provide short-term loans for residential real estate investment properties. The goal here is often to refinance the property in 12 to 36 months, to be able to pay off the hard money loan. Investors may use a hard money loan for a rental property if they need to be able to close the deal quickly, and don’t have the time to go to a bank. Or they may need a private loan if the rental property needs repairs before a bank will finance the deal.

Let’s look at Hard Money for Multifamily Properties

Like loans for rental properties, investors may need capital quickly to close on a multifamily property. This is the case if there’s not enough time to go through the traditional lending process. Private money lending is just plain faster.

An investor may also be buying a multifamily property with little to no tenants that needs a lot of repairs. This type of property would be hard to get financed with a bank, so they may seek out a hard money loan. Investors can get the necessary work done. And they can lease the property before refinancing it with a long term loan.

Consider Hard Money for Commercial Real Estate

A common situation with commercial real estate is an investor having a tenant to lease space to, but no property to put them in. The investor will find a vacant property that the tenant will lease out, but they have to buy the property and get it ready for the tenant first.

A bank may not want to finance a vacant property intended for use as an investment if the borrower doesn’t have the assets to secure the loan. A hard money loan can be useful in this situation to get the deal done. The investors can accomplish the tenant improvements and get the property leased. Once the tenant is in place and paying rent, a bank will be more willing to finance the real estate.

Check out Interest and Fees on Hard Money Loans

The convenience and easy approval with a hard money loan comes at a cost. Lenders will charge higher interest on hard money loans. This is because they are higher risk loans. It is also because these loans are short term.

Longer term loans will earn interest for several years from processing one loan. But the money invested in hard money loans must be reinvested every six to 36 months. There’s added cost and new risks each time that money is invested in a loan. Interest rates for these loans tend to be a few percentage points higher than traditional bank loans.

Learn business loan secrets and get money for your business.

Check out Hard Money Fees

The lender will charge upfront fees to cover the cost of processing the loan, plus any commissions being paid. This also ensures they still earn a profit; in case the borrower pays off the loan before the end of the term.

Common fees for a hard money loan include origination fee, broker fee, application fee, underwriting fee, document prep fee, processing fee, and funding fee. These fees can add up to thousands of dollars.

Consider Credit Checks and Property Values

In general, private lenders are going to be all right with average credit. Their main concern is the value of the property. Plus a lender wants to know the market the property is in. This is due to higher risk. The lender wants to be able to recover their costs in case of foreclosure. See fool.com/millionacres/real-estate-financing/hard-money-loans/5-best-hard-money-lenders.

More Details on Private Small Business Loans and Hard Money Loans

There is a balloon payment at the end of the short term. For fix and flip, the lender knows the borrower can afford the balloon payment. But in the case of a borrower looking to refinance the property by the end of the term, the may not be as willing to lend to someone with bad credit. They will look closer at the borrower’s credit and personal finances in this case. The lender may also require a higher down payment to limit their risk in case the borrower can’t pay the lender off at the end of the term.

Private lenders for business loans will look into a borrower’s experience. For a fix and flip, private business lenders will want borrowers who have completed at least a few other deals. Smaller lenders usually stick to markets they know and states that have a strong real estate market. They often don’t like rural properties and provide a lower loan to value for them.

Private Money Financing: Takeaways

Private money financing is a way for real estate investors and house flippers to get funding. Also called hard money loans, private money financing tends to have fast approvals, but higher interest rates and no regulation to speak of. Experienced flippers in urban areas with good real estate markets are more likely to get approval.

The post Private Business Lenders appeared first on Credit Suite.

Getting Business Credit Cards in a Recession: How to Establish Separate Business Credit

You can get business credit cards that do not report to personal credit. This is the case despite what’s going on with the novel coronavirus.

How to Establish Separate Business Credit: Get Business Credit Cards That Do Not Report to Personal Credit

What do you know about how to establish separate business credit? Business credit cards that do not report to personal credit are not out of reach. We know the secrets!

Remember that any inquiries into your consumer credit score will negatively impact that score. And a lot of merchants and lenders will carry out inquiries when working with you for the first time. Separate business credit means you keep business credit card inquiries from affecting your consumer credit.

COVID-19 and Recession Era Financing

As the novel coronavirus continues to

How to Establish Separate Business Credit: Get a D&B D-U-N-S number

Start at the D&B website and obtain a cost-free D-U-N-S number. A D-U-N-S number is how D&B gets a small business in their system, to generate a PAYDEX score. If there is no D-U-N-S number, then there is no record and no PAYDEX score.

Once in D&B’s system, search Equifax and Experian’s sites for the business. You can do this at https://www.creditsuite.com/reports/. If there is a record with them, check it for accuracy and completeness. If there are no records with them, go to the next step in the process.

This way, Experian and Equifax will have activity to report on.

How to Establish Separate Business Credit: File a DBA

If you operate a small business as a sole proprietor, then at the very least be sure to file for DBA (‘doing business as’) status.

If you do not, then your personal name is the same as the small business name. Because of this, you can find yourself being personally liable for all small business financial obligations.

Also, according to the Internal Revenue Service, with this structure there is a 1 in 7 possibility of an IRS audit. There is a 1 in 50 chance for corporations! Steer clear of confusion and significantly reduce the odds of an Internal Revenue Service audit as well.

And who would not want that?

But keep in mind – don’t treat a DBA filing as anything beyond a steppingstone to incorporating.

How to Establish Separate Business Credit: Go Beyond a DBA and Make Your Small Business a Distinct Legal Entity through Incorporation

Meet with your tax consultant or financial planner. And together, pick which legal entity (sole proprietor, LLC or S-Corp) will most effectively fit your company and particular financial circumstances.

Incorporation can also help to secure your personal assets. That is in the event of a lawsuit. Once your corporation or LLC is registered on your state’s Secretary of State’s website, you can then get a Business Federal Tax ID Number. So then you can open your business’s bank account.

How to Establish Separate Business Credit: Get an EIN

Visit the IRS website and get an EIN for the company. They’re free of charge. Pick a business entity such as corporation, LLC, etc.

A small business may get started as a sole proprietor. But they absolutely need to change to a variety of corporation or an LLC.

This is to diminish risk. And it will make best use of tax benefits.

A business entity matters when it comes to taxes and liability in case of litigation. A sole proprietorship means the entrepreneur is it when it comes to liability and taxes. Nobody else is responsible.

The best thing to do is to incorporate. You should only look at a DBA as an interim step on the way to incorporation.

How to Establish Separate Business Credit: Company Legitimacy

A small business must be reputable to lending institutions and merchants. That is why, a small business will need a professional-looking website and email address, with website hosting bought from a merchant such as GoDaddy.

And company phone numbers must have a listing on ListYourself.net.

At the same time the company telephone number should be toll-free (800 exchange or similar).

A corporation will also need a bank account dedicated strictly to it, and it must have all of the licenses essential for operation. These licenses all have to be in the accurate, accurate name of the company, with the same small business address and phone numbers.

So note that this means not just state licenses, but potentially also city licenses.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

How to Establish Separate Business Credit: Build Business Credit

Business helps to protect a business owner’s personal assets, in the event of court action or business bankruptcy. Also, with two separate credit scores, an entrepreneur can get two separate cards from the same merchant. This effectively doubles purchasing power.

Another advantage is that even startup companies can do this. Going to a bank for a business loan can be a recipe for disappointment. But building small business credit, when done correctly, is a plan for success.

Consumer credit scores depend on payments but also additional components like credit utilization percentages. But for company credit, the scores truly only hinge on whether a company pays its debts in a timely manner.

Business credit is an asset which can help your business for years to come.

The Process

Growing small business credit is a process, and it does not happen automatically. A small business has to actively work to develop business credit. However, it can be done easily and quickly, and it is much quicker than developing individual credit scores.

Merchants are a big aspect of this process.

Doing the steps out of sequence will lead to repetitive denials. Nobody can start at the top with small business credit. For instance, you can’t start with store or cash credit from your bank. If you do you’ll get a rejection 100% of the time.

Starter Vendor Credit

First you need to establish tradelines that report. Then you’ll have an established credit profile, and you’ll get a business credit score.

And with an established business credit profile and score you can begin to get credit for numerous purposes, and from all sorts of places.

These varieties of accounts tend to be for things bought all the time, like marketing materials, shipping boxes, outdoor workwear, ink and toner, and office furniture.

But first of all, what is trade credit? These trade lines are credit issuers who give you starter credit when you have none now. Terms are oftentimes Net 30, versus revolving.

Therefore, if you get an approval for $1,000 in vendor credit and use all of it, you must pay that money back in a set term, such as within 30 days on a Net 30 account.

Details

Net 30 accounts need to be paid in full within 30 days. 60 accounts have to be paid in full within 60 days. In comparison with revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you made use of.

To start your business credit profile the right way, you should get approval for vendor accounts that report to the business credit reporting agencies. As soon as that’s done, you can then use the credit.

Then repay what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.

Vendor Credit – It Helps

Not every vendor can help like true starter credit can. These are vendors that grant approval with negligible effort. You also need them to be reporting to one or more of the big three CRAs: Dun & Bradstreet, Equifax, and Experian.

Here are some stellar choices from us: https://www.creditsuite.com/blog/5-vendor-accounts-that-build-your-business-credit/

Uline

Uline is a true starter vendor. You can find them online at www.uline.com. They sell shipping, packing, and industrial supplies, and they report to Dun & Bradstreet and Experian. You MUST have a D-U-N-S number and an EIN before starting with them. They will ask for your company bank information. Your company address must be uniform everywhere. You need for an order to be $50 or more before they’ll report it. Your first few orders may need to be prepaid initially so your company can get approval for Net 30 terms.

  • How to apply with them:
  • Add an item to your shopping cart
  • Go to checkout
  • Select to Open an Account
  • Select to be invoiced
Crown Office Supplies

Crown Office Supplies is another true starter vendor. You can find them online at https://crownofficesupplies.com. They sell a variety of office supplies and take helping clients seriously. They say, “just starting your business, or maybe have an existing business, but you have a question regarding office supplies… we are here to help!” And they report to Dun and Bradstreet, Experian, and Equifax.

There is a $99.00 yearly fee, though they do report that fee to the business credit reporting agencies. For other purchases to report, the purchase must be at least $30.00. Terms are Net 30.

  • Here’s how to qualify:
  • Your corporate entity must be in good standing with the applicable Secretary of State
  • You must have an EIN and a D-U-N-S number
  • Business address (it has to match everywhere)
  • Business license (if applicable)
  • A corporate bank account
  • Corporation must be at least 60 days old
  • Membership fee is $99 annually upon approval

Apply online.

Grainger Industrial Supply

Grainger Industrial Supply is also a true starter vendor. You can find them online at www.grainger.com. They sell hardware, power tools, pumps and more. They also do fleet maintenance. And they report to D&B. You need a business license, EIN, and a D-U-N-S number.

  • To qualify, you need the following:
  • A business license (if applicable)
  • An EIN number
  • A company address matching everywhere
  • A company bank account
  • A D-U-N-S number from Dun & Bradstreet

Your corporate entity must be in good standing with the applicable Secretary of State. If your company does not have established credit, they will require additional documents. So, these are items like accounts payable, income statement, balance sheets, and the like.

Apply online or over the phone.

build separate business credit in a bad economy Credit SuiteStore Credit

Store credit comes from a variety of retail service providers.

You must use your Social Security Number and date of birth on these applications for verification purposes. For credit checks and guarantees, use the small business’s EIN on these credit applications.

Fleet Credit

Fleet credit is from businesses where you can purchase fuel, and fix and take care of vehicles. You must use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, make certain to apply using the company’s EIN.

Cash Credit

These are companies such as Visa and MasterCard. You must use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, use your EIN instead.

These are often MasterCard credit cards.

Accounts That Don’t Report

Non-reporting trade accounts can also be helpful. While you do want trade accounts to report to at least one of the CRAs, a trade account which does not report can also be of some worth.

You can always ask non-reporting accounts for trade references. Plus, credit accounts of any sort should help you to better even out business expenditures, consequently making financial planning less complicated.

More of How to Establish Separate Business Credit: Monitor Your Business Credit

Know what is happening with your credit. Make sure it is being reported and attend to any mistakes ASAP. Get in the habit of taking a look at credit reports. Dig into the particulars, not just the scores.

We can help you monitor business credit at Experian and D&B for a lot less than it would cost you at the CRAs. At Equifax, you can monitor your account at: www.equifax.com/business/business-credit-monitor-small-business.

Update Your Records

Update the data if there are errors or the data is incomplete. At D&B, you can do this at: https://iupdate.dnb.com/iUpdate/viewiUpdateHome.htm. For Experian, go here: www.experian.com/small-business/business-credit-information.jsp. So, for Equifax, go here: www.equifax.com/business/small-business.

Fix Your Business Credit

So, what’s all this monitoring for? It’s to dispute any errors in your records. Errors in your credit report(s) can be taken care of. But the CRAs usually want you to dispute in a particular way.

Get your small business’s PAYDEX report at: www.dnb.com/about-us/our-data.html. Get your company’s Experian report at: www.businesscreditfacts.com/pdp.aspx?pg=SearchForm. And get your Equifax business credit report at: www.equifax.com/business/credit-information.

Disputes

Disputing credit report mistakes generally means you mail a paper letter with duplicates of any evidence of payment with it. These are documents like receipts and cancelled checks. Never mail the original copies. Always mail copies and retain the original copies.

Fixing credit report mistakes also means you specifically itemize any charges you dispute. Make your dispute letter as crystal clear as possible. Be specific about the problems with your report. Use certified mail to have proof that you mailed in your dispute.

Dispute your or your business’s Equifax report by following the instructions here: www.equifax.com/small-business-faqs/#Dispute-FAQs.

You can dispute errors on your or your company’s Experian report by following the directions here: www.experian.com/small-business/business-credit-information.jsp.

And D&B’s PAYDEX Customer Service contact number is here: www.dandb.com/glossary/paydex.

A Word about Business Credit Building

Always use credit sensibly! Don’t borrow more than what you can pay off. Track balances and deadlines for payments. Paying on time and fully will do more to increase business credit scores than nearly anything else.

Building company credit pays off. Excellent business credit scores help a small business get loans. Your loan provider knows the small business can pay its financial obligations. They know the business is bona fide.

The company’s EIN links to high scores and lenders won’t feel the need to call for a personal guarantee.

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

How to Establish Separate Business Credit: Check Out Some of Our Favorite Credit Cards

Perks vary. So make sure to choose the perk you prefer from this range of options.

Secure Business Credit Cards for Fair Credit Scores

Capital One® Spark® Classic for Business

Have a look at the Capital One® Spark® Classic for Business. It has no yearly fee. There is no introductory APR offer. The regular APR is a variable 24.49%. You can get unlimited 1% cash back on every purchase for your company, with no minimum to redeem.

While this card is within reach if you have fair credit, beware of the APR. Yet if you can pay promptly, and completely, then it’s a bargain.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-classic/

Business Credit Cards for Extravagant Travel Points

Flat-rate Travel Rewards

Capital One® Spark® Miles for Business

Have a look at the Capital One® Spark® Miles for Business. It has an introductory yearly fee of $0 for the first year, which then rises to $95. The regular APR is 18.49%, variable due to the prime rate. There is no introductory annual percentage rate. Pay no transfer fees. Late fees go up to $39.

This card is excellent for travel if your expenses don’t fall under basic bonus categories. You can get unlimited double miles on all purchases, without any limits. Earn 5x miles on rental cars and hotels if you book through Capital One Travel.

Get an initial bonus of 50,000 miles. That’s the same as $500 in travel. But you only get it if you spend $4,500 in the initial 3 months from account opening. There is no foreign transaction fee. You will need a great to outstanding FICO rating to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-miles/

Bonus Travel Categories with a Sign-Up Offer

Ink Business Preferred℠ Credit Card

For a wonderful sign-up offer and bonus categories, have a look at the Ink Business Preferred℠ Credit Card.

Pay an annual fee of $95. Regular APR is 17.49 – 22.49%, variable. There is no introductory APR offer.

Get 100,000 bonus points after spending $15,000 in the first three months after account opening. This works out to $1,250 toward travel rewards if you redeem with Chase Ultimate Rewards.

Get 3 points per dollar of the initial $150,000 you spend with this card. So this is for purchases on travel, shipping, internet, cable, and phone services. Plus it includes advertising purchases made with social media sites and search engines each account anniversary year.

You can get 25% more in travel redemption when you redeem for travel via Chase Ultimate Rewards. You will need a good to outstanding FICO score to qualify.

Find it here: https://creditcards.chase.com/business-credit-cards/ink/business-preferred

No Annual Fee

Bank of America® Business Advantage Travel Rewards World MasterCard® credit card

For no yearly fee while still getting travel rewards, check out this card from Bank of America. It has no annual fee and a 0% introductory APR for purchases during the initial 9 billing cycles. Afterwards, its regular APR is 13.74 – 23.74% variable.

You can earn 30,000 bonus points when you make a minimum of $3,000 in net purchases. So this is within 90 days of your account opening. You can redeem these points for a $300 statement credit towards travel purchases.

Earn unlimited 1.5 points for every $1 you spend on all purchases, everywhere, every time. And this is no matter how much you spend.

Likewise get 3 points per every dollar spent when you book your travel (car, hotel, airline) through the Bank of America® Travel Center. There is no limit to the number of points you can get and points don’t expire.

You will need superb credit to get this one (as in, 700s or better).

Find it here: https://www.bankofamerica.com/smallbusiness/credit-cards/products/travel-rewards-business-credit-card/

Hotel Credit Card

Marriott Bonvoy Business™ American Express® Card

Take a look at the Marriott Bonvoy Business™ Card from American Express. It has an annual fee of $125. There is no introductory APR offer. The regular APR is a variable 17.24 – 26.24%. You will need good to outstanding credit scores to get this card.

Points

You can earn 75,000 Marriott Bonvoy points after using your card to make purchases of $3,000 in the initial three months. Get 6x the points for eligible purchases at participating Marriott Bonvoy hotels. You can get 4x the points at United States restaurants and filling stations. And you can get 4x the points on wireless telephone services bought directly from American service providers and on American purchases for shipping.

Get double points on all other eligible purchases.

Rewards

Also, you get a free night every year after your card anniversary. And you can earn another free night after you spend $60,000 on your card in a calendar year.

You get Marriott Bonvoy Silver Elite status with your Card. Plus, spend $35,000 on eligible purchases in a calendar year and get an upgrade to Marriott Bonvoy Gold Elite status through the end of the next calendar year.

Plus, each calendar year you can get credit for 15 nights towards the next level of Marriott Bonvoy Elite status.

Find it here: https://creditcard.americanexpress.com/d/bonvoy-business/

Dependable Credit Cards for Fair to Poor Credit, Not Needing a Personal Guarantee

Brex Card for Startups

Take a look at the Brex Card for Startups. It has no annual fee.

You will not need to supply your Social Security number to apply. And you will not need to supply a personal guarantee. They will take your EIN.

Nevertheless, they do not accept every industry.

Additionally, there are some industries they will not work with, as well as others where they want more paperwork. For a list, go here: https://brex.com/legal/prohibited_activities/.

To determine creditworthiness, Brex checks a corporation’s cash balance, spending patterns, and investors.

You can get 7x points on rideshare. Get 4x on Brex Travel. Also, get triple points on restaurants. And get double points on recurring software payments. Get 1x points on everything else.

You can have bad credit (even a 300 FICO) to qualify.

Find it here: https://brex.com/lp/startups-higher-limits/

Find out why so many companies are using our proven methods to improve their business credit scores, even during a recession.

Flexible Financing Credit Cards – Take A Look at Your Alternatives!

The Plum Card® from American Express

Have a look at the Plum Card® from American Express. It has an initial yearly fee of $0 for the first year. Afterwards, pay $250 annually.

Get a 1.5% early pay discount cash back bonus when you pay within 10 days. You can take up to 60 days to pay without interest when you pay the minimum due by the payment due date.

You will need excellent to excellent credit to qualify.

Find it here: https://creditcard.americanexpress.com/d/the-plum-card-business-charge-card/

Unbeatable Cards for Jackpot Rewards That Never Expire

Capital One® Spark® Cash Select for Business

Check out the Capital One® Spark® Cash Select for Business. It has no yearly fee. You can get 1.5% cash back on every purchase. There is no limit on the cash back you can earn. And earn a one-time $200 cash bonus once you spend $3,000 on purchases in the initial three months. Rewards never expire.

Pay a 0% introductory APR for 9 months. Then pay 14.49% – 22.49% variable APR after that.

You will need good to superb credit to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash-select/

Exceptional Business Credit Cards with No Annual Fee

No Annual Fee/Flat Rate Cash Back

Ink Business Unlimited℠ Credit Card

Have a look at the Ink Business Unlimited℠ Credit Card. Past no annual fee, get an introductory 0% APR for the first 12 months. After that, the APR is a variable 14.74 – 20.74%.

You can earn unlimited 1.5% Cash Back rewards on every purchase made for your corporation. And get $500 bonus cash back after spending $3,000 in the first 3 months from account opening. You can redeem your rewards for cash back, gift cards, travel and more using Chase Ultimate Rewards®. You will need superb credit to receive this card.

Find it here: https://creditcards.chase.com/business-credit-cards/ink/unlimited

Company Credit Cards with a 0% Introductory APR – Pay Zero!

Blue Business® Plus Credit Card from American Express

Check out the Blue Business® Plus Credit Card from American Express. It has no yearly fee. There is a 0% introductory APR for the first year. After that, the APR is a variable 14.74 – 20.74%.

Get double Membership Rewards® points on day to day company purchases like office supplies or client suppers for the first $50,000 spent per year. Get 1 point per dollar afterwards.

You will need good to exceptional credit to qualify.

Find it here: https://creditcard.americanexpress.com/d/bluebusinessplus-credit-card/

American Express® Blue Business Cash Card

Also check out the American Express® Blue Business Cash Card. Keep in mind: the American Express® Blue Business Cash Card is identical to the Blue Business® Plus Credit Card from American Express. However its rewards are in cash instead of points.

Get 2% cash back on all qualified purchases on up to $50,000 per calendar year. After that get 1%.

It has no yearly fee. There is a 0% introductory APR for the first year. After that, the APR is a variable 14.74 – 20.74%.

You will need good to excellent credit scores to qualify.

Find it here: https://creditcard.americanexpress.com/d/business-bluecash-credit-card/

Terrific Cards for Cash Back

Flat-Rate Rewards

Capital One ® Spark® Cash for Business

Take a look at the Capital One® Spark® Cash for Business. It has an introductory $0 annual fee for the initial year. Afterwards, this card costs $95 annually. There is no introductory APR deal. The regular APR is a variable 18.49%.

You can get a $500 one-time cash bonus after spending $4,000 in the initial 3 months from account opening. Get unlimited 2% cash back. Redeem any time without any minimums.

You will need good to outstanding credit scores to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash/

Flat-Rate Rewards and No Yearly Fee

Discover it® Business Card

Have a look at the Discover it® Business Card. It has no yearly fee. There is an introductory APR of 0% on purchases for one year. Then the regular APR is a variable 14.49 – 22.49%.

Get unlimited 1.5% cash back on all purchases, with no category restrictions or bonuses. They double the 1.5% Cashback Match™ at the end of the first year. There is no minimum spend requirement.

You can download transactions| quickly to Quicken, QuickBooks, and Excel. Note: you will need good to outstanding credit scores to receive this card.

https://www.discover.com/credit-cards/business/   

Bonus Categories

Ink Business Cash℠ Credit Card

Check out the Ink Business Cash℠ Credit Card. It has no yearly fee. There is a 0% introductory APR for the initial year. After that, the APR is a variable 14.74 – 20.74%. You can get a $500 one-time cash bonus after spending $3,000 in the first three months from account opening.

You can earn 5% cash back on the initial $25,000 spent in combined purchases at office supply stores and on internet, cable, and phone services each account anniversary year.

Get 2% cash back on the initial $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year. Earn 1% cash back on all other purchases. There is no limitation to the amount you can get.

You will need excellent credit scores to qualify for this card.

Find it here: https://creditcards.chase.com/business-credit-cards/ink/cash?iCELL=61GF

Boosted Cash Back Categories

Bank of America® Business Advantage Cash Rewards MasterCard® credit card

Have a look at the Bank of America® Business Advantage Cash Rewards MasterCard® credit card. Get an 0% introductory APR for the initial 9 billing cycles of the account. Afterwards, the APR is 13.74% – 23.74% variable. There is no yearly fee. You can get a $300 statement credit offer.

Get 3% cash back in the category of your choice. So these are filling stations (default), office supply stores, travel, TV/telecom & wireless, computer services or business consulting services. Get 2% cash back on dining. So this is for the initial $50,000 in combined choice category/dining purchases each calendar year. Then earn 1% after, with no limits.

You will need exceptional credit scores to qualify.

Find it here: https://promo.bankofamerica.com/smallbusinesscards2/

The Perfect Business Credit Cards for You

Your perfect business credit cards are dependent on your credit history and scores.

Only you can determine which advantages you want and need. So be sure to do your research. What is excellent for you could be disastrous for someone else.

And, as always, make sure to build credit in the recommended order for the best, fastest benefits.

How to Establish Separate Business Credit: Takeaways

Bolster the professionalism of your company and learn how to establish separate business credit.

You can get business credit cards that do not report to personal credit. Learn more here and get started in getting business credit cards that do not report to personal credit. The COVID-19 situation will not last forever.

The post Getting Business Credit Cards in a Recession: How to Establish Separate Business Credit appeared first on Credit Suite.

How to Get Business Loans with Bad Credit

You may think it is impossible to get business loans with bad credit.  In truth, it is just impossible to do so from traditional banks without some sort of guarantee.  There are other options however. 

Is It Possible to Get Business Loans with Bad Credit? 

For example, the government guarantees loans from traditional banks through The Small Business Administration, or SBA.  This government guarantee makes it easier to get loans with lower credit scores than would normally be acceptable.  

Business Loans with Bad Credit: SBA Loans

The key is, how bad is “bad” credit.  Generally speaking, you can qualify for a loan most anywhere with a credit score over 730.  However, your interest rates may leave a lot to be desired. If your credit score is less than that, but above 650, you may qualify for one of these SBA loans programs. 

7(a) Loans

This most popular SBA loan program offers federally funded term loans up to $5 million. In addition, the funds can be used for expansion, purchasing equipment, working capital and more. Banks, credit unions, and other specialized institutions process these loans and disburse the funds. What does that mean?  It means that you apply with a traditional lender, but it isn’t exactly a traditional loan.

The minimum credit score to qualify is 680.  Also, there is a required down payment of at least 10% for the purchase of a business, commercial real estate, or equipment. Lastly, the minimum time in business is 2 years. In the case of startups, business experience equivalent to two years will work.

Funds are available for a wide variety of projects, from working capital to refinancing debt.  You can even buy a new business or real estate.

504 Loans 

These loans are available up to $5 million.  You can use the funds to buy machinery, facilities, or land. Typically, these are expansion loans. They especially work well for commercial real estate purchases.

Terms for 504 Loans range from 10 to 20 years.  Unfortunately, funding is slow.  It can take from 30 to 90 days. They require a minimum credit score of 680, and they use the asset the loan is financing as collateral. Furthermore, there is a down payment requirement of 10%.  This can increase to 15% for a new business.

Like 7 (a) loans, you must be in business for at least 2 years, or management must have equivalent experience if the business is a startup.

Microloans 

Microloans go up to $50,000. They work well for starting a business, purchasing equipment, buying inventory, or as working capital. Community based non-profits administer microloan programs as intermediaries. Unlike most other SBA loans, financing comes directly from the Small Business Administration.

They can take upwards of 90 days to fund. The minimum credit score for microloans is 640, and collateral and down payment requirements vary by lender.

SBA Disaster Loans 

As a general rule, disaster loans go up to $2 million.  However, there are tons of changes in the program right now due to the need for COVID-19 relief.  These loans are also processed directly through the SBA rather than through partner lenders. They are for small-business owners that have been affected by natural disasters, and the COVID-19 pandemic has been deemed to qualify as a natural disaster.  Terms go up to 30 years.  The maximum interest rate is 4%, and you can apply for disaster loans directly at SBA.gov.

The minimum credit score for these loans is 660. Additionally, collateral is necessary if the loan goes over a certain amount.  That amount is usually $25,000. For a military economic injury disaster, the amount that requires collateral is $50,000. Either way, a down payment is not necessary.

SBA Express Loans 

The max amount for these loans is $350,000. Terms range from 5 to 25 years.  To qualify, your credit score must be above 680.  Also, you must have a debt to service ratio of 1.1 or higher. If the loan is greater than $25,000, collateral may be necessary depending on the lender.

As the name suggests, you get funds from express loans much faster.  In fact, the SBA takes 36 hours or less to give a decision. Not only that, but the necessary paperwork for application is less also.  This makes express loans a great option for working capital, among other things, if you qualify.

SBA CAPLine 

There are 4 distinct CAPLine programs that differ mostly in the expenses they can fund. Each of them carries a maximum amount of $5 million. In addition, the interest rate for each range from 7% to 10%. Like many of the others, funding can take 45 to 90 days.

The four different programs are:

  • Seasonal CAPLines 
  • Contract CAPLines 
  • Builder’s CAPLines 
  • Working Capital CAPLines

For these, the minimum credit score to qualify is 680. However, there is no minimum time in business requirement unless you are getting a seasonal CAPLine. That one carries a one year in business requirement.

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Business Loans with Bad Credit: Alternative Loans

These are loans from private lenders rather than traditional banks.  Most of them operate online exclusively.  We’ve listed a few for you below.  Be sure to double check details like required credit score and interest rate, as these things can change without notice. 

Fundbox

Fundbox is going to be one of the first lenders to pop up if you search for alternative business loans.  It is a line of credit rather than a loan, but it is a great funding option because there is no minimum credit score requirement.

They offer an automated process that is super-fast. Repayments are automatic, meaning they draft them electronically, and they occur on a weekly basis.  One thing to remember is that you could have a repayment as high as 5 to 7% of the amount you have drawn currently, as the repayment period is comparatively short.  This means you need to be sure you have enough funds in whatever account you connect them to so that it can cover your payment each week.

Loan amounts come as low as $100 and as high as up to $100,000, but the max initial draw is $50,000. Though there is no minimum credit score requirement, they do require at least 3 months in business, $50,000 or more in annual revenue, and a business checking account with a minimum balance of $500.

BlueVine 

The minimum loan amount available from BlueVine is $5,000 and the maximum is $100,000. Annual revenue must be $120,000 or more and the borrower must be in business for at least 6 months. Your personal credit score has to be 600 or above. It is important to note also, that BlueVine does not offer a line of credit in all states.

Upstart

Upstart uses a completely innovative platform for alternative loans.  The company questions the ability of financial information and FICO alone to truly determine the risk of lending to a specific borrower.  Instead, they choose to use a combination of artificial intelligence and machine learning to collect alternative data.  They then use that data to help them make credit decisions.

Alternative data can include mobile phone bills, rent, deposits, withdrawals, and even other information less directly tied to finances.  The software they use learns and improves on its own. You can use their online quote tool to play with different amounts and terms to see the various interest rate possibilities.  Typically, business loans are available ranging from $1,000 to $50,000.  Interest rates vary greatly, ranging from 7.5% to 35.99%.  You can pay back loans over either 3-years or 5-years. 

To be eligible for a loan with Upstart, you must meet the following qualifications:

  • Credit score of 620+
  • No bankruptcies or negative public records
  • No delinquent accounts
  • Meet debt to income standards (they only note they will check this ratio, not what their standards are.)
  • Have fewer than 6 inquiries in the past 6 months on your credit report, not including those related to student loans, vehicle loans, or mortgages

These are the requirements they list on their website.  One independent review said that the requirement for the debt to income ratio is a maximum of 45%. It also says that the minimum annual income has to be at least $12,000.  

Fora Financial 

Fora Financial funds more than $1.3 million in working capital around the United States. There is an early repayment discount if you qualify.

This is a great option for business loans with bad credit.  Why? Here is what Fora Financial says about credit score:

“At Fora Financial we do not believe that the number of your credit score defines who you are as a business owner. We look at your entire business model along with your future plans to create a financing program that will help you reach your goals.”

As you can see, there really isn’t a minimum credit score requirement.   

Loan amounts range from $5,000 to $500,000. The business must be at least 6 months in operation and the monthly revenue has to be $12,000 or more. There can be no open bankruptcies.

OnDeck 

Obtaining financing from OnDeck is quick and easy. First, you apply online and receive your decision once application processing is complete. If you receive approval, your loan funds will go directly to your bank account. The minimum loan amount is $5,000 and the maximum is $500,000.

They do require a personal credit score of 600 or more for at least one owner. Also, you must be in business for at least 3 years. Annual revenue must be at or exceed $100,000. In addition, there can be no bankruptcy on file in the past 2 years and no unresolved liens or judgements.

Kiva 

Kiva is an online lender that is a little different. For example, the interest rate is 0%, so even though you have to pay it back it is absolutely free money. They don’t even check your credit. However, there is one catch.  You have to get at least 5 family members or friends to throw some money in the pot as well. In addition, you have to pitch in a $25 loan to another business on the platform.

Accion 

Accion  is a microlender, a nonprofit, that offers installment loans to both startups and already existing businesses. You don’t have to already be in business, but if you are not, you must have less than $500 in past due debt. In addition, your business needs to be home or incubator based.

Loans are from 6 to 60 months and interest rates range from 7% to 34%. A personal guarantee, and sometimes specific collateral, is necessary in most circumstances.

What’s the minimum credit score?  Accion says it best in their FAQ’s:

“Credit is just one of many factors that we look at when we work with business owners. If your credit isn’t well established or damaged, we can work to find strengths in your business or finances to make the loan possible. We do have firm requirements on past due debt and bankruptcies and have credit score minimums in some areas, so please check our loan requirements to see if we are a good fit for you.”

Basically, depending on your other information, Accion can be a good option for business loans with bad credit. 

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Build and Improve Business Credit and Forget About Business Loans with Bad Credit

Maybe one of these options will work for you.  But what if you didn’t have to worry about finding business loans for bad credit? What if you could have good business credit?  Guess what?  You absolutely can!  How?  Well, first, you have to set up your business to be an entity separate from yourself.  That way, when you take out debt in your business name and repay it, the accounts will report to your business credit report and not your personal credit report. 

There is a lot to building fundability and business credit, but here is a starting point.  

  • Make sure you and your business do not share contact information.  Your business needs a separate phone number and address
  • Get your business an EIN so you can apply for business credit without your SSN.
  • Incorporate your business as an LLC, S-corp, or corporation. 
  • Make sure your business has all the licenses it needs to operate legally. 
  • Open a separate, dedicated business bank account. 

After your business is set up properly, you can work with starter vendors to build business credit.  These are companies that sell things you use in the course of everyday business, like office supplies, cleaning supplies, even packaging materials.  They will issue net invoices without doing a credit check, so you don’t have to have credit to get credit with them.  Then, they will report your payments to the business credit reporting agencies. That gets the ball rolling. 

It is Possible to Get Business Loans with Bad Credit

It is absolutely possible to get business loans with bad credit.  However, once you get the funding you need, don’t stay in a bad credit hole.  Get to work building a ladder to get yourself out. Get the funds you need to stay open, but at the same time, work to put yourself in a better position for the future.

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Fundability and How it Helps During Recession 2020

Get through recession 2020 even though loan risk factors abound. But you can fix a lot of them with assuring fundability. The easiest way to do this is via building business credit. but first, let’s look at what a bank is going to want to know. they want to assess what sorts of small business loan risk factors you bring to the table.

Get By Recession 2020 and Answer Lender Questions and Address Small Business Loan Risk Factors With Fundability

Fundability – or, not just the ability to become funded but how desirable a company is for funding – means different things to banks, venture capitalists, angel investors, and informal investors. That being said, they all agree on a few fundamental principles.

1. Do You Have Positive Cash Flow?

Lenders aren’t in the business of giving you gifts. Instead, they would like to see a profit on their investment. For that reason, if you are bleeding funds, they are not going to want to pay for a piece of what, to their minds, is an unsatisfactory financial commitment.

How do you turn it around? Do some economic triage. Perhaps your firm will not need to have an alternative site. Perhaps you don’t need to have a full-time assistant when part-time will do. Maybe you should be leaning harder on your customers with pending invoices. This is one of the biggest small business loan risk factors.

Start-ups will get a different question – see # 2.

2. Do You Have a Great Product or Service?

For startup companies, the concern is more like: do you have a fantastic product or service? A concept in itself is not going to be sufficient, so you also will want to have a comprehensive business system in place. Investors are going to want to see what you can do with your amazing idea, and how it can be successfully monetized. 

For a brand-new company this is the biggest of all loan risk factors. Otherwise, why bother making a company at all? Particularly during Recession 2020.

3. What Will You Use the Cash For?

If your reply is an unclear, “general fund”, investors are not going to be showing an interest. First of all, they want you to demonstrate you will be responsible with their money. In addition, they also want to know that your business is organized. You can be the most innovative and the very least business-oriented man or woman out there, so long as anyone in your organization is dealing with the financial heavy lifting. Somebody must make sure that the taxes are paid and the invoices go out to your clients.

Investors don’t actually want to see you using the funds for daily operations. If your business is functioning profitably (see # 1), then investors will expect that you can manage those expenses. Rather, they want to see if you are going to employ their funding for something new and different. In general, this implies you must be using their funds for improvement – a new piece of essential machinery; a new shop; a second facility; a new product line – these are just a few plans which would fit the bill for progress. 

See # 4 for the similar question for startups. This is another one of the bigger loan risk factors. Lenders want to know their money isn’t being thrown away. After all, they make a lot more money if you pay your loan off and pay interest. Getting their money back through collections is a lot less profitable for them. And they are going to be looking to maximize their returns during Recession 2020.

4. How Much Funding Do You Need to Reach Positive Cash Flow?

For startups, a similar question is: just how much funding will you need to get to positive cash flow and profitability? In this case, your use for the money is still a distinct one – it’s to bring your new business to profitability.

5. How Much Revenue Yearly Can Your Business Generate After Three Years?

This question is the same whether you are presently in business or you are aiming to get a startup business funded. This will separate the lifestyle businesses (designed to make their owners glad but not develop into bigger players) from the scalable businesses. A lifestyle business normally won’t get this sort of funding. Instead, it will be funded by virtue of secured debt or bootstrapping or secured debt.

A scalable business can still be modest and not expect explosive growth, but still be fundable. Your new widget warehouse might begin small. Investors would expect it to have more moderate funding needs.

6. What Number of Your Existing Clients, Channels, and Partners Will Support Your New Business Growth and Volume?

Introducing new markets (or going for new customers or trying to market new products) will be viewed as riskier, unless you have an established history of financial success via pioneering. See # 7 for the semi-comparable question for startup ventures.

7. How Do You Know That Anybody Will Buy Your Product or Service?

If you do not know your market, then you will not know how to target to those customers. If your clients are middle-aged women, they will most likely respond to different techniques than if your customers are teen boys. Merely making a product and flinging it out to the ether, praying someone will buy it, is not going to sit well with investors. Instead, they want you to have scouted out your prospective clientele prior to you coming knocking and asking for funding.

The rest of the questions are only for startups.

8. How Much Funding Can You Get From Friends and Family to Launch Your Business?

Oftentimes these are your most important investors, or they might be your only investors. Treat them well. This goes double in Recession 2020.

9. How Much Funding Can You Personally Add?

Investors would like to know this amount because it indicates a commitment to the startup. If you want to keep your life savings, you’ll be a lot more careful with funds than if you’re just playing around with other people’s money. Of course you should be even more careful during Recession 2020.

10. Who Comprises Your Team?

Your team does not have to be employees of your business. It can also be consultants and mentors. Contact your school. There might be an educator interested in your new business, even if you never took a class with that person. Not a college alum? Try your nearby community college just the same. A professor might even want to use your company experience and story in a lecture.

Recession 2020 Credit Suite

Learn more here and get started with building business credit with your company’s EIN and not your SSN. Get money even in Recession 2020!

But How Do You Best Address These Risk Factors During Recession 2020? Build Business Credit!

Small business credit is credit in a business’s name. It doesn’t connect to an entrepreneur’s consumer credit, not even if the owner is a sole proprietor and the only employee of the business. 

Because of this, a business owner’s business and personal credit scores can be very different.

Consumer credit scores depend upon payments but also other elements like credit usage percentages. 

But for small business credit, the scores truly only hinge on whether a business pays its debts promptly.

The Process

Building company credit is a process. It does not occur automatically. A company has to proactively work to develop small business credit. 

Having said that, it can be done readily and quickly, and it is much quicker than building personal credit scores. 

Vendors are a big component of this process.

Doing the steps out of order leads to repetitive denials. Nobody can start at the top with small business credit. For instance, you can’t start with retail or cash credit from your bank. If you do, you’ll get a denial 100% of the time.

Company Fundability

A business needs to be fundable to credit issuers and vendors. This is the best way to address any small business loan risk factors.

Hence, a business needs a professional-looking website and e-mail address. And it needs to have site hosting bought from a vendor like GoDaddy. 

Additionally, company telephone and fax numbers need to have a listing on 411. You can do that here: http://www.listyourself.net.  

In addition, the business phone number should be toll-free (800 exchange or similar).

A business also needs a bank account dedicated solely to it, and it has to have all of the licenses essential for running. 

Licenses

These licenses all must be in the perfect, accurate name of the company. And they need to have the same small business address and phone numbers. 

So note, that this means not just state licenses, but possibly also city licenses.

Recession 2020 Credit Suite

Learn more here and get started with building business credit with your company’s EIN and not your SSN. Get money even in Recession 2020!

Working with the Internal Revenue Service

Visit the IRS web site and get an EIN for the business. They’re totally free. Choose a business entity like corporation, LLC, etc. 

A company can start off as a sole proprietor. But they more than likely want to change to a variety of corporation or an LLC. 

This is to decrease risk. And it will make best use of tax benefits.

A business entity matters when it pertains to taxes and liability in case of litigation. A sole proprietorship means the entrepreneur is it when it comes to liability and taxes. Nobody else is responsible.

Incorporating is a great way to address small business loan risk factors.

Kicking Off the Business Credit Reporting Process

Begin at the D&B website and get a free D-U-N-S number. A D-U-N-S number is how D&B gets a business into their system, to generate a PAYDEX score. If there is no D-U-N-S number, then there is no record and no PAYDEX score.

Once in D&B’s system, search Equifax and Experian’s sites for the business. You can do this at www.creditsuite.com/reports. If there is a record with them, check it for accuracy and completeness. If there are no records with them, go to the next step in the process. 

In this manner, Experian and Equifax have something to report on.

Starter Vendor Credit

First you ought to build trade lines that report. This is also called starter vendor credit. Then you’ll have an established credit profile, and you’ll get a business credit score. 

And with an established business credit profile and score you can begin to get credit at even more establishments.

These kinds of accounts have the tendency to be for the things bought all the time, like marketing materials, shipping boxes, outdoor work wear, ink and toner, and office furniture.

But to start with, what is trade credit? These trade lines are credit issuers who give you starter credit when you have none now. Terms are commonly Net 30, rather than revolving. 

Therefore, if you get approval for $1,000 in vendor credit and use all of it, you must pay that money back in a set term, like within 30 days on a Net 30 account.

Details

Net 30 accounts have to be paid in full within 30 days. 60 accounts need to be paid completely within 60 days. Compared to with revolving accounts, you have a set time when you have to pay back what you borrowed or the credit you made use of. 

To start your business credit profile the right way, you need to get approval for vendor accounts that report to the business credit reporting agencies. When that’s done, you can then make use of the credit. 

Then pay back what you used, and the account is on report to Dun & Bradstreet, Experian, or Equifax.

You want at least 3, preferably 5 to 8 of these to move onto the next step, retail credit. Here are some stellar choices from us: https://www.creditsuite.com/blog/5-vendor-accounts-that-build-your-business-credit/ 

Note: it can often be possible to apply for starter vendor credit without your Social Security number. Try it by leaving that section blank, or applying over the phone.

Retail Credit

Once there are at least 3 vendor trade accounts reporting to at least one of the CRAs, then move onto retail credit. These are stores, and they can be either net accounts or revolving.

Just use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, use the small business’s EIN on these credit applications – if you can.

Fleet Credit

Are there something like 8 to 10 accounts reporting? Then move onto fleet credit. These are businesses such as BP and Conoco. Use this credit to buy fuel, and to repair, and take care of vehicles. Only use your SSN and date of birth on these applications for verification purposes. For credit checks and guarantees, make sure to apply using the business’s EIN. But that is only if that’s possible. It isn’t always possible. So, this is because federal law requires SSNs on anything to do with banks. If a card ultimately comes from a bank, then a Social Security number is necessary, no matter what.

Recession 2020 Credit Suite

Learn more here and get started with building business credit with your company’s EIN and not your SSN. Get money even in Recession 2020!

More Universal Credit

Have you been sensibly managing the credit you’ve up to this point? Then move onto service providers like Visa and MasterCard. Only use your Social Security Number and date of birth on these applications for verification purposes. This is a federal law requirement. For credit checks and guarantees, see if you can use your EIN instead.

These are commonly MasterCard credit cards. If you have 14 trade accounts reporting, then these are more likely to be attainable.

Monitor Your Business Credit

Know what is happening with your credit. Make certain it is being reported and address any mistakes as soon as possible. Get in the practice of checking credit reports and digging into the particulars, and not just the scores.

We can help you monitor business credit at Experian and D&B for only $24/month. See: www.creditsuite.com/monitoring

At Equifax, you can monitor your account at: www.equifax.com/business/business-credit-monitor-small-business. That will cost about $19.99.

Update Your Information

Update the details if there are inaccuracies or the details is incomplete.

Fix Your Business Credit

So, what’s all this monitoring for? It’s to contest any inaccuracies in your records. Mistakes in your credit report(s) can be fixed. But the CRAs often want you to dispute in a particular way.

Disputes

Disputing credit report inaccuracies typically means you send a paper letter with copies of any proof of payment with it. These are documents like receipts and cancelled checks. Never mail the originals. Always mail copies and retain the original copies.

Fixing credit report inaccuracies also means you specifically spell out any charges you dispute. Make your dispute letter as understandable as possible. Be specific about the issues with your report. Use certified mail to have proof that you sent in your dispute.

Taking the initiative and handling any errors as fast as possible will also help address any small business loan risk factors.

A Word about Building Business Credit

Always use credit sensibly! Don’t borrow beyond what you can pay back. Track balances and deadlines for payments. Paying off promptly and completely does more to boost business credit scores than just about anything else. And beyond that, responsible account management will counter any small business loan risk factors.

Establishing company credit pays. Great business credit scores help a small business get loans. Your loan provider knows the business can pay its debts. They know the business is for real. 

The company’s EIN links to high scores and lending institutions won’t feel the need to call for a personal guarantee.

Getting Through Recession 2020: Takeaways

Business credit is an asset which can help your business in years to come. Learn more here and get started toward establishing company credit. And stop worrying about Recession 2020!

The post Fundability and How it Helps During Recession 2020 appeared first on Credit Suite.

The Tale of Elusive Minority Business Loans: Where to Find Them and What It Takes to Get Them

Minority Business Loans are Out There, You Just Have to Know Where to Look

The United States is full of those considered to be “in the minority.” In fact, in some areas the majority of the population is considered to belong to a minority group! This is why minority business loans are more important than ever. Ensuring minority business owners have the funding they need to help their business thrive is vital to the economy.

The thing is, if you do not know where to look or what you are looking for, it can be difficult to snag one minority business loans. We are here to help you have a successful hunt.

The Best Sources for Minority Business Loans

There really are several sources for minority business loans. It is necessary to know the specifics of each however, before you can move in for the kill. Some only offer minority business loans to those in certain cities. Some are only available if you are looking to land government contracts. Each have their own requirements, and it takes a ton of time and research to figure it all out. We have a lot of research here to save you time. You do not have to start from scratch.

Business Consortium Fund, Inc.

This program is designed specifically for minority businesses. It is certified by the US Department of the Treasury. Businesses can qualify for $75,000 to $500,000 after approval. Amounts above $500,000 are on a case by case basis.

Funds can be used for working capital, equipment financing, and contract financing. To apply, you have to certify your business through National Minority Supplier Development Council. Additionally, you must have a supplier relationship with the Council.

National African American Small Business Loans

These loans are only available to low- and medium-income communities in Chicago, Los Angeles, and New York. The  NASBLF provides capital to African American minority-owned businesses not eligible for traditional financing.

Loans range from $35,000 on the low end to $250,000 on the high end. Technical assistance and financial consultation services are also available to business owners. Allowable fund uses include expansion, equipment purchases, and cash flow. They only have $30 million total to loan out in a year, unless more grant funds become available to the program.

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Accion

Accion offers funding in all states for minorities, veterans, women, those with disabilities, and low to medium income business owners. Loan amounts range from $200,000 to $300,000. They work to help build businesses from the beginning, and can put owners in contact with other banks, non-profits, and government resources that help build a network of support.

The minimum credit score for these loans is 575, and you cannot be 30 days late on credit cards, loan payments, or bills. In addition, you will not qualify if you have any late rent or mortgage payments over the past year.

Community Development Financial Institutions Fund (CDFI)

This group lends to those communities that are traditionally underbanked, including business owners that are minorities. Since the Community Reinvestment Act of 1977, banks are required to offer funding in communities that find it hard to qualify for traditional funding. Big banks often fund minority business owners indirectly through their CDFI partners.

To locate a CDFI, contact the local business development center or your local Small Business Development Center office. They can hook you up.

While the application process can be lengthy, they do offer assistance to prepare for future bank loans. In addition, their rates are competitive within the U.S.

Union Bank Business Diversity Lending Program

This program from Union Bank assists minority business owners with loans and lines of credit. To qualify as a minority for this program you must be Hispanic, American Indian, Latino, Asian, Alaskan Native, African American, Native Hawaiian, or other Pacific Islander.

A business that has revenue of up to $20 million could qualify for a loan of up to $2.5 million. However, you must be in business for at least 2 years, and the minority business owner must own at least 51 percent.

Indian Affairs

Businesses owned my Native Americans can get financing from the federal government through the Indian Affairs branch. An individual can fill out an application for up to $500, 000, but business entities and tribal enterprises my apply for more.

Potential borrowers can apply with any lending institution, they just have to use the Indian Affairs application. If the funds are used for construction, renovation, or refinancing, there are additional requirements. Generally, a list of collateral, a credit report, and an analysis of business operations are required.

Camino Financial

They are an online lender that offers minority-owned businesses loans and business solutions. They process all of their lending online, which makes it easy and convenient. Their microloans range from $5,000 to $50,000. They also offer small business loans between $10,000 to $400,000.

There is no collateral requirement. Also, you can pay off the loan any time with no penalties or fees. Pre-qualification happens within 24 hours, and since all documents are submitted online, you do not have to make unnecessary trips to turn in or sign papers.

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Other Options for Minority Business Loans

If you do not qualify for any of those already mentioned, or if you need more funding than what you can get with them, you may need a plan B. There are other options out there, but first you should know that traditional big banks are probably not on the list.

Why Big Banks Probably Will Not Work

Big banks are what most people think of as the first stop when it comes to getting a loan. That is true for some, but for most small business owners they are not the way to go. This is true whether they are looking for minority business loans or business loans in general.

Here’s why:

● Small businesses represent small loans with higher failure rates than larger businesses. Most are not at ease lending to companies with less than $1 million in sales.

● Big banks like collateral, and small businesses are less likely to have sufficient collateral for the loans they need. They are more likely to be leasing assets than larger businesses may own and offer as collateral.

● They also like to see a personal credit score of at least 680. Many small businesses, especially those that are less than 3 years old, do not have this.

So, what are small businesses to do if they need funding? What if the specific minority business loans are not enough? Consider these other options.

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Community Banks: Minority Business Loan Heroes

Community banks can be a great option. They are more easily accessible to small businesses in general. They tend to have better customer service and care more about the people involved than the bottom line. Often, they are more interested in building relationships with their lenders than their big bank counterparts are. However, their rates and terms are typically just as good as those with the larger lenders.

The downside is, as a brick and mortar financial institution they are still going to be slow. You will have to make multiple trips to the bank, and the whole process can be kind of long and drawn out.

The Small Business Administration

The Small Business Administration, or SBA, offers a number of options for minority business loans. They do not lend funds themselves, but rather work with lenders to offer security, so that they can make loans to those business owners that may be considered higher risk than what they would normally consider approving.

SBA Community Advantage loans:

Community advantage loans from the SBA are designed for businesses in underserved communities that need less than $250,000. You can find lenders that work with the SBA on this program using the SBA Lender Match tool.

SBA microloans

They also have microloans available of up to $50,000. These are offered through nonprofit organizations. With interest rates ranging from 8% to 13% and maximum repayment terms of six years, they can work well for those need minority business loans

One of the SBA’s partners in this program is The Opportunity Fund. According to them, of its borrowers, 90% are minority business owners.

SBA 8(a) business development program

If you are a small business interested in government contracts, an 8(a) certification can help. Your business must be at least 51% controlled by individuals that are “socially and economically disadvantaged.” This includes minorities, veterans, and women.

SBA 7 (a) Loans

These are not specifically for minorities, but they are available to minorities as well as everyone else. They are 10-year loans of $30,000 to $350,000. Rates range from 9.7% to 11.04%, and they can turn around in as little as seven days, though they more often take up to several weeks.

Alternative Lenders and Minority Business Loans

While not necessarily only for minorities, many alternative lenders offer loans that meet the challenges often faced by those seeking business loans. One of the greatest issues for small business owners when it comes to small business financing is credit score. The following loans are available with a lower credit score than what is typically required by traditional lenders.

Fundbox

There is no minimum credit score, but if you have at least $50,000 in annual revenue you can qualify for a line of credit from Fundbox. You also need to be in business for at least 3 months. Amounts range from $1,000 to $100,000 with rates from 10.1% to 79.8%. Terms are for 12 weeks, and you can have your funds as quickly as the next business day.

Kabbage

Another lender that will make loans on credit scores as low as 500 is Kabbage. Terms are for 6, 12, or 18 months and amounts range from $2,000 to $250,000. Interest rates are higher, at 24% to 99%. Funding can take several days, but sometimes happens in just a few minutes.

QuarterSpot

QuarterSpot is another option, and it is preferable for many as the terms go up to 18 months. Loans range from $5,000 to $250,000, but rates are pretty high at 30% to 70%. Approval can happen in as little as 24 hours.

Credibility Capital

Loans with Credibility Capital range from $50,000 to $400,000. Terms are for 1,2, or 3 years, and rates range from 10% to 25%. Funding usually takes around 7 days.

SmartBiz

SmartBiz offers low cost financing for expansion. These are SBA loans, but with SmartBiz funding happens a lot faster than with traditional banks. In fact, they can take a few weeks rather than a few months.

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Business Credit is Better

These minority business loans are heavily dependent on personal credit scores. That’s well and good, and if you qualify and need funding now, go for it. Regardless of whether or not you qualify for these loans however, you need to be building business credit.

Business credit is credit that is not connected to your personal credit score. It is based on the merits of your business alone. It is much better to use business credit than personal credit to fund your business. For one thing, if your business goes bust, your personal credit will not be affected directly. However, handling business transaction using your personal credit can negatively affect your credit score even if you make all of your payments on time.

This is due to the fact that, by nature, personal credit limits are lower than business credit limits. At the same time, business transactions are more expensive than personal ones. This means that if you fund business transactions on personal credit, you will always be close to maxing out your credit. That raises your debt-to-service ratio, which in turn lowers your credit score.

How Do You Get Business Credit?

The first step is to make your business look fundable. That means separating it from yourself in all ways possible. There needs to be a business address that is separate from your own, as well as a dedicated business telephone number through a toll-free exchange.

In addition, you need to incorporate. That means choosing between a corporation, s-corp, or LLC. A sole proprietorship or partnership will not work for business credit building. Next, apply for and EIN. It functions similarly to an SSN, but for your business.
There are a ton of other steps to establishing business credit, but these will give you a great start.

Don’t Give Up on Minority Business Loans

One thing is for certain, there are a ton of options out there for minority business loans. The only catch is that not all of them will work well for every minority owned business. We have given you enough to get you started, now get moving figuring out which ones will work for you. In the meantime, start building business credit so you can fund your business using its own credit and not your personal credit.

The post The Tale of Elusive Minority Business Loans: Where to Find Them and What It Takes to Get Them appeared first on Credit Suite.

Ideal Home Owner Insurance Quote

Ideal Home Owner Insurance Quote

Buying vital and also as large as a resident insurance plan ought to be taken seriously. Undoubtedly, you wish to buy your plan from the most effective business, along with obtain the most effective resident insurance policy quote.

Just how can you do that?

When it involves homeowner insurance policy quotes, what establishes the insurance provider apart?

Property owner insurance provider are distinguished in numerous methods. Take a look at the score of the property owner insurer concerned, in addition to whether they are certified to do company in your state. Property owner insurer likewise vary in the degree of protection they use and also the sort of protection you can add to your resident insurance plan.

While you’re going shopping for the finest house proprietor insurance policy quote, discover the firm’s score. Talk to household participants, good friends, as well as next-door neighbors concerning the residence proprietor insurance coverage firms with which they do service.

What truly makes the most effective resident insurance policy quote?

The ideal house proprietor insurance coverage quote differs from individual to individual. You require to inspect out numerous various residence proprietor insurance coverage firms.

Where can I discover whatever I require to learn about homeowner insurance coverage in my state?

Your state’s division of insurance policy has all the details you require to understand about property owner insurance policy protection in your state. The insurance coverage division will certainly likewise have the ability to give you with a checklist of property owner insurer and also representatives certified to do service in your state.

Look at the ranking of the residence proprietor insurance coverage firms in concern, as well as whether or not they are accredited to do service in your state. Residence proprietor insurance policy business likewise vary in the degree of protection they supply and also the kinds of protection you can include on to your residence proprietor insurance coverage plan.

While you’re going shopping for the finest house proprietor insurance policy quote, discover the business’s ranking. Talk to household participants, buddies, as well as next-door neighbors concerning the residence proprietor insurance policy firms with which they do service.

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