Getting your first line of business credit is a great way to establish yourself as a business owner and potentially gain access to larger credit limits. Here are some steps to take to get started:
Open a business bank account: Open a business checking account at a bank that reports your activity to the major business credit bureaus. This will help create your business credit history.
Apply for a business credit card: Applying for a business credit card is an easy way to start building credit. Look for a card with no annual fee or one that offers rewards like cash back or points. Many issuers will also offer cards with low or no pre-set spending limits, which can be especially helpful for start-up businesses with limited credit histories.
Check your credit: Before applying for any line of credit, check your business credit report and personal credit score. You should also look into any pre-qualification options available to you. This will help you identify any outstanding issues that need to be resolved before you apply.
Consider a short-term loan: A short-term loan is a great way to get fast access to capital. While interest rates will be higher than those of most other forms of credit, it can be a good way to access a small amount of capital quickly and build a positive payment history for your business.
Talk to your vendors: Talk to your vendors about the possibility of extending you a line of credit. Many will be willing to extend credit terms to a well-established and reputable business.
These are just some of the steps you can take to get your first line of business credit. Establishing your creditworthiness takes time, but with some effort, you can ensure that your business has access to the capital and resources it needs to succeed.