Establishing Business Credit

[Kevin Suksi]

We have an LLC which is about 9 months old and are trying to establish business credit. I have gathered from other postings that you want to try to get 5 trade lines established and that the business must be at least 2 years old in order to get a line of credit from a bank.

I'm wondering if anyone has any suggestions.

So far we have:

1 - established a line at Home Depot for the business for $10,000
2 - applied for an AMEX in the business name, denied due to short duration being in business
3 - applied for discover in the business's name which is currently pending

I have an 800 personal FICO.

I've also gathered that we should put the utilities in the business's name on the next flip. We do have a DUNS number established for the business; I believe this happened when we got the home depot account.

Does anyone have any advice as to where some good places to get trade lines might be? I'd like to minimize how many applications I submit because too many inquiries can damage your profile.

Thanks in advance for any replies. I value the insight provided in this forum very much.

[Account Closed]

Kevin,
I have touched on this topic before and I'm currently working on building business credit. There are several things to consider when building credit, and the length of tiime it takes to achieve it.

To start did you provide a EIN to Home Depot or was it your SS#? Home Depot is a level 2 teir and is extremly difficult to achieve a business line without a PG. Are they reporting to DnB or experian or are they reporting to your personal credit profile?

A duns number is something that you have to apply for, its not something that is given. You must go to their website and apply for this number which can take up to 30 days to get.

As far as starting to build credit without a PG you need to established 5 trade accounts which typically are net 30 terms.

Some companies that offer this our:
uline.com
quill.com
granger.com
northerntool.com
nebs.com ( they might not report to DnB anymore would verify before purchase)

Their are several more that are more suited for rehab/outdoor work as well.

To start with these companies you will have to a business address that is not your home, your cell phones listed under a business directory or under 411 directory.

Make a purchase for 25- 50 dollars at 2 accounts first then wait 2 weeks and make another 2 purchase at different trade accounts.Making sure that the invoices are paid 2 weeks before due date. You will have to keep doing this before you even get a paydex score usually takes anywhere between 4-6 months. There is another way to get a paydex score faster but you have to pay for this service through DnB.

We can go into further detail on this tomorrow when we meet for lunch.

Hope this helps a little.

Looking forward to meeting you tomorrow.
Greg