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Question for Marv?

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I am getting ready to purchase a new service vehicle for my business. I am a sole proprietor. Can I finance the vehicle in the business name and be a guarantor on the loan? I would like to keep the loan off of my personal credit reports. Is this possible?

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I've always taken business purchase requests with a grain of salt.   There is always a reason that a person would want to do this.  I try to ask why so I can facilitate the process.   I'm always met with resistance.

 

So please bear with me as I do my routine.

 

First question.   How long has your company been in business?

 

As a sole proprietor, by default, the legal name of your business is your own name. But you can choose operate the business under another name, known as a "fictitious business name" or "doing business as" (DBA). Most states require you to file an application for your DBA.

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2 hours ago, MarvBear said:

I've always taken business purchase requests with a grain of salt.   There is always a reason that a person would want to do this.  I try to ask why so I can facilitate the process.   I'm always met with resistance.

 

So please bear with me as I do my routine.

 

First question.   How long has your company been in business?

 


As a sole proprietor, by default, the legal name of your business is your own name. But you can choose operate the business under another name, known as a "fictitious business name" or "doing business as" (DBA). Most states require you to file an application for your DBA.

I have been in business as a sole proprietor for 6 years.

 

As per my EIN letter my legal business name is my own name followed by DBA - Company name.

 

The fictitious name is registered with the Dept. of State.

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This is going to be some conjecture on my part.    I arrange the loan(s), and seldom have contact with the consumer after the fact, so I have never bothered to quiz a former customer about credit reporting under similar situations.

 

So, I would say since you are effectively the Sole Proprietor and yourself are one and the same from an analyst, then I feel that a prospective commercial lender to which I had access would require you to sign for the loan also.  Doesn't really matter what you call it, either a co-maker or a guarantor.   This being the case I do believe the lender would report it on your personal credit file(s) also.

 

Perhaps someone who has actually done this as a Sole Proprietor sees this and can answer for their particular situation to help you.

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43 minutes ago, MarvBear said:

This is going to be some conjecture on my part.    I arrange the loan(s), and seldom have contact with the consumer after the fact, so I have never bothered to quiz a former customer about credit reporting under similar situations.

 

So, I would say since you are effectively the Sole Proprietor and yourself are one and the same from an analyst, then I feel that a prospective commercial lender to which I had access would require you to sign for the loan also.  Doesn't really matter what you call it, either a co-maker or a guarantor.   This being the case I do believe the lender would report it on your personal credit file(s) also.

 

Perhaps someone who has actually done this as a Sole Proprietor sees this and can answer for their particular situation to help you.

Thank you for your reply Marv it's much appreciated.

 

The reason I would like to do this is to keep my DTI down. My current service vehicle loan and business equipment loans are on my personal credit report. Therefore I always have to explain that those expenses have been accounted for in my net income so those payments shoudn't factor into my DTI. It would make life a lot easier if I could. Thanks again Marv.

 

 

Edited by steelers1

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