Project EX asked:


Hello, I just finished opening my own corporation. I received my federal Tax ID number, and went ahead and applied for a Bank Account.

Question #1 my question is, what sort of programs could i sign up for: Credit Card, i guess, so i can raise the companies credit, and able to buy a good amount of inventory $900 – $2,500 a month depending without the fear of taking out a lease.

I have thought about American Express, since they have expectional customer service, and great cards

Question 2: When i apply for a Credit card for my company, and it asks for my social secruity number, does it check my credit or the companies credit?

Thank you
Just to add a few details: How is a company supposed to build credit, if its expecting a regional launch in 5 months? I have a 730 credit score, with a few inquires from my bank in September / October 2006, which should be ok.

I’m assuming the Credit Card should be accepted, I don’t see any reason why not.
Just to add a few details: How is a company supposed to build credit, if its expecting a regional launch in 5 months? I have a 730 credit score, with a few inquires from my bank in September / October 2006, which should be ok.

I’m assuming the Credit Card should be accepted, I don’t see any reason why not.

In most countries, a credit report, also known as credit history or credit reputation, is a record or documentation of a company’s or a person’s previous borrowing and payments. Such record also contains information regarding bankruptcy and late payments.

When applying for credit from a credit card company, a store or a bank, the customer will be required to fill out an application form and the information that he/she will put in that form will then be forwarded to a credit bureau or a consumer reporting agency, together with his/her credit history, regular updates on the standing of his/her credit accounts, buying history, residence history and whether he/she has been bankrupt or not in the last 10 years. If for instance you have been imprisoned, sued or arrested for financial reasons, then it will be reflected on your credit history.

The information will be used by banks, credit card companies and other lenders to know the credit worthiness of an entity or an individual. This will help the lender and businesses in evaluating your applications for insurance, credit, employment and other purposes authorized by the Fair Credit Reporting Act. Because of this, you need to review your credit report regularly for factual errors and omissions.

Factors in Determining your Credit Rating

Though the ways to determine credit ratings in every country are different, the factors or determinants are the same and may consist of:

• Payment history – Late payments on your usual monthly bills should be avoided because it will definitely lower your credit rating. The credit card debts and bank loans are usually missed because they aren’t as critical as your gas or electricity bills.

• Debt Control – The lenders want to make sure that the borrowers are not taking debt than they can actually handle. As estimated by experts, the borrower’s non-mortgage credit payments every month should not be more than fifteen percent of his/her net income. And one of the means to reduce your monthly expenditures is to get rid of chronic expenses, like car loans. Through this, your debt-reduction plan can have more funds.

• Borrower’s stability and responsibility – the lenders usually see things like the borrower’s longevity in his/her job. They consider this as a sign of your stability.

• Closing Credit Accounts – bear in mind that credit scoring companies usually pay much attention to the duration of your credit history so closing your old credit accounts will lower your credit rating since it deletes your longest payment history. However, closing newer accounts can make your score get better by lessening your available amount of credit.

• Re-aging – this process can significantly enhance your credit report score because through this, your credit history is re-written and you will have a fresh start on that certain account.

• Credit Inquiries – inquiry or notation on your credit report file are of two kinds:

1. Soft Credit Inquiries

a. The credit agency can sell the individual’s or entity’s contact details to a certain advertiser who’s buying a list or persons with the same characteristics, such as homeowner with outstanding credit rating.

b. A creditor can review an individual’s credit every so often.

c. With the permission of the client, the credit counseling agency can also get the client’s credit reputation.

2. Hard Credit Inquiries – this can be done by lenders, with the borrower’s permission, for the sole intention of extending his/her credit. Such inquiries from lenders can affect the customer’s credit rating so it will be better to keep your credit inquiries to a minimum number. There are lenders who will think that many credit inquiries means that he/she is planning to make loans.

These are just among the factors that directly affect your credit report score, particularly if you are applying for a credit card or making a loan. But you should not forget that there’s no quick fix in improving your credit score and maintaining a good rating is quite hard. It takes a little scrimping, discipline and common sense but they will all be worth, when you finally get your card or your loan without much hassle. A credit report is not biased since it will just jot down information but it will not judge whether your action id good or bad.

By: Nathalie Fiset

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Most businesses these days are set up to accept credit cards. They can accept credit cards online, by mail, by telephone, or at the point of sale. However, there are often times when a business must be able to accept payment cards when they are away from their place of business, such as at events and Expos. One option that enables you to accept plastic cards in a ‘mobile’ venue is a credit card imprinter. These imprinters are not as outdated as one may think, and many businesses still use them today at their business location.

In the past, this method of accepting credit cards was pretty much the only option available. The only really good thing about this option was the ability to take the device with you wherever you went, as there is no electricity or connection that is needed for these devices. An imprint of the card was made, and the credit card companies supplied merchants with booklets that had lists of payment card numbers that were valid. The booklets were updated monthly and sent to merchants, and when a merchant accepted the credit card, and used the credit card imprinter, they looked up the number in the booklet, or they called the card processing company to make sure that the card was good.

However, today we need faster and more reliable ways of getting the needed information from the customer and making sure that the payment card is good. Consumers demand security and safety when they hand us their plastic cards or give us their payment card numbers, and the most secure way to use a payment card, as most consumers now know is with the use of the latest technology for encryption. If you aren’t using a higher standard of encryption technology than an old credit card imprinter, you risk losing a great deal of business, since most consumers do not want you or anybody else to have an actual imprint of their payment card.

If purchasing a mobile card payment terminal isn’t financially feasible for you, there are lease options available to you. You can lease these terminals for longer periods or short periods, although in most cases, the company that you lease from will have a minimum length for the lease – typically three days. Often, this short lease period option is even cheaper than the money that you would spend for an unacceptable – in the minds of the consumers – non-technical credit card imprinter, and obviously, it is much more secure.

You can get leases for these terminals on the Internet, and the terminal is delivered to you about one day before your actual lease period starts, and you return it one day after your lease period ends. The company that you lease from generally pays for the delivery both ways. When you receive your terminal, it will be ready to use – the company sets everything up for you prior to delivery of the device, and technical support is available during your lease period as well.

By: Brantley Graham

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creditnow11 asked:

Free Credit Report

mymammoth asked:


For example, in college the credit card companies are always there in the beginning of every semester trying to get students to apply. They also offer “free goodies” if you apply.

I don’t think a lot of 18 year olds in college fully know the implications of having a card.

Do you also think it would help if they raised the minimum age (of getting a credit card) to 21 instead of 18?

Prince Of Light asked:


How do i go about applying for a new business loan?
I am starting a new business by buying and reselling consumer electronics, what do i need to obtain a new business loan or a grant.
What do the banks look at before getting you approved?

vanderbilttim asked:

A Guide To a Better Understanding of You Credit Scores. Click here, www.trw-credit.com

Michael asked:


I have recently paid off everything on my credit report. My credit score is slowly creeping up. I, like a lot of people, screwed up my credit when I was younger and am paying for it now. My Scores range from 579 – 618. Can someone give me some feedback please?

Have all your ducks in a row.

You have a product, have written your business plain and sales pitch and even found a great location, now you need financing to get your new business off the ground. It takes money to make money; this is an old adage that is even truer today as it was in days past. Here you are, all set to go but, you don’t have available cash, your relatives are as broke as you and friends run at the mere hint of borrowing money.

Your only alternative for backing is a Financial Institute. The only problem is you have never had any association, with a Financial Institute and don’t know what to do. Your hands are tied, and it is clear your local banker is your only choice for funding.

Getting past the loan application.

Passing the scrutiny of a financial institution can be intimidating to say the least. There are some simple steps to follow that will greatly improve your chances for obtaining the funding you need.

Desire is yours, not the bankers

Most entrepreneurs know their product and have a great desire but the fact is, most will have experiences and loan turndowns simply because of poor communications and education. The banker’s lack of information about your business intent and needs and your not supplying correct information result in his/her not having a clear picture of your intent. You must learn the bank’s procedures, policies and constraints before discussing financing with the lender.

Consider the bankers position

First, consider the banker. Bankers are trained to always require two sources of repayment: the primary source such as, cash flow for short-term loans, and earnings for long-term loans. This should be backed up with some sort of collateral, such as accounts receivable, inventory, or a mortgage on fixed assets. Then if the business venture goes south from the original plan, the banker has at least one position to fallback on.

Can you guarantee the loan?

The banker may also require a personal guarantee from you as the business owner. A personal guarantee is also required of a major stakeholder or partner depending on the business description. A sole proprietor guarantees by virtue of his/her signature of a note. Another scenario where a guarantee may be requested is in the case of a non-involved spouse, who is the joint owner of the other personal asset of the businessperson. i.c. a jointly owned home being used as collateral.

Is this blatant overkill on the part of the lender? Why should they require three sources of repayment? Your banker does not necessarily expect to gain a great deal of financial security from your personal signature but, he/she wants your total commitment and support to making the business successful and thus securing his/her loan.

Remember, the banker is an employee of the bank. If to many bad loans are made, he/she will lose his/her job. Your banker doesn’t want to take a chance on a loan if you are hesitant to back it up with personal assets. If you are not unwilling to commit, the confidence of the banker is reduced significantly.

The five Cs and more

Your banker evaluates your loan request using the “five Cs of Credit”.

1. Character – by far the most important If you are not someone to be trusted, then the bankwill not want to deal with you, no matter how good your deal looks. Character also includes your past credit history and that of any principals involved.

2. Capacity – What is your financial strength, track record, and ability to service debt based on your projection.

3. Capital – how much of our own money do you have invested?

4. Collateral – What is available to support the primary source of repayment?

5. Conditions – what is the economy doing, and how will it affect your business? Conditions also include governmental and industry regulations, pending legal action affecting your venture, and the company’s marketing plan.

Finally, here are some do’s and don’ts that when applied, will help to strengthen your banking relationship.

Do:

a) Make an appointment and allocate enough time.

b) Be completely honest. Tell the good and bad.

c) Be prepared. Anticipate the worst and best scenario.

d) Ask questions if you don’t understand something.

e) Have a definite plan based on industry averages, your familiarly with the business you are starting, if any past operation history, reasonable assumptions, etc. but be flexible.

f) Keep your banker informed.

g) Negotiate rates after you’ve presented the loan request, keeping in mind the most important thing is that you get a loan, and at least initially, not the rate you pay.

Do Not:

a) Be impatient.

b) Make promises you can’t keep.

c) Ask “how much” you can borrow.

d) Negotiate interest rates over the telephone.

e) Spend the money before you ask for it.

f) Change banks soley for a better interest rate, unless your bank is not competitive.

g) Surprise your banker.

Money makes the business go.

Without funding your business may die before it gets started. The funding process is essential to the health of your new business. Unless you have money, or a rich uncle you will have to acquire money from a lending institution, grant, or stake holder. Do not rely on credit cards for funding. Because of high interest, Credit cards are not a good source for funding.

Start up businesses take up to three years before they show a profit. Taking this into consideration, make sure you are funded to survive the start-up time frame.

Be prepared.

Before you go to your banker be sure you have a sound business plan, statement of purpose, marketing plan and one, five and ten year projections. Be confident in your calculations and projections. Be sure you let your banker know you are responsible for supplying future progress reports to him/her. If you have an accountant, take him/her along for your loan interview. Your banker may better relate to someone who is on his/her same level of expertise.

Happy Trails

By: Donald Yates

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