The Business Credit Basics You Need to Know
Building business credit should go hand-in-hand with building your business. Your business needs its own credit so you can keep your its finances separate from your personal finances. That way if something goes wrong with either the commercial side or the individual side, the other end won’t be impacted.
The first step to building business credit is to be legitimate. Get an Employer Identification Number from the IRS, open accounts in the name of your company, and get a credit card, credit line, or small loan in the name of your company. These steps start your business’s credit history. You can buy on credit from suppliers who report to business credit bureaus.
To build your credit, you must pay on time — or early, if possible. In addition, you should review your business credit reports regularly to look for any errors or overlooked items that could be dragging your score down. Over time, you’ll build a positive reputation and will be able to increase your credit limit and take out bigger loans, allowing your business to grow as well.
If you have any questions about business credit or need help correcting an error on your credit report, talk to the team at our accounting firm in Long Island, NY. We’re always happy to answer your questions and help your company succeed.