Stage One of the Business Credit Success Guide
How to Build Small Business Credit with No Personal Guarantee

Step 18 ~ Reporting Trade References

The amount of time spent on the seemingly unimportant tasks necessary to properly structure your business are about to show their worth as you begin to apply for business credit with no personal guarantee. First of all we would like to remind you again that building business credit is a slow and tedious process and any deviation will hinder your business’ ability to obtain unsecured financing with no personal guarantee.

The next nine stages of this guide will go into detail about the process of building business credit but for now it is important to begin thinking about your motives for building business credit, what type and amount of unsecured financing your small business wants and needs to access and most importantly how fast it needs financing. If your business is in need of immediate financing please visit the Financing Section of our website and contact one of our experts to walk you through the options available, and yes there are some available without a personal guarantee if your business meets certain qualifications. Whether or not this is the case, you will be better off in the long-run by starting to build the business credit foundation now so your small business will be able to access larger and more flexible capital financing sources down the road.

It is important to introduce the concept of business credit and the importance of finding trade references that report to the business credit bureaus.  A business credit file is similar to your personal credit file as they both report the credit activity and payment history that can be accessed by lenders when making a decision on whether or not to accept an application, determining interest rates, setting terms of the account and when increasing the current credit limit.  If none of your personal accounts reported to your personal credit file, I’m sure you understand how difficult, if not impossible, it would be to obtain any type of credit as having no credit file is often worse than having a bad credit file. Luckily, the personal credit bureaus are heavily monitored and regulated by the government so the majority of creditors regularly report account activity.

The opposite can be said for the business credit bureaus, there is no regulation and the industry standard is to not report any account activity or payment history. Truth be told, almost every major commercial vendor and most banks will lend to a business if it has a thick and established credit file which can be difficult if only 10% of vendors report to the business credit bureaus.  The good news for you is that in this guide we will provide you with enough vendors that will approve your business based on the current stage of your business credit profile and the best part is that each of them has historically reported activity to each of the business credit bureaus.  Wherever you are starting we will give you the steps required to build a solid thick business credit file so you can obtain any type of unsecured financing with no personal guarantee.

If you are still confused don’t worry, we will make the process as simple as possible so just keep reading and take each step we tell you to take. Remember, there are no shortcuts and skipping a step could permanently ruin your business credit file.