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EIN - Business Credit


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  • 4 weeks later...

Its not true, you don't need to get your DUNS Number. 


In many cases when you apply for starter business credit they will alert DNB of your first payment with them and DNB will create a profile and number for your company.


But if you'd like, you can goto their website and create a profile and receive a number for free within 30 days. 


Regarding your question "Any advice for beginners before I get into using business credit?" 


When it comes to business credit heres what you need to know. 


There two main types of business credit:


Personal Guarantee and No Personal Guarantee Business credit.


Personal guarantee means you (the individual) will personally guarantee the debt and will be held liable to pay it. 

It also means you will undergo a personal credit check that will be used to determine your approval.


Many think they want no personal guarantee business credit because they are taught that their business credit should be separated from their personal. 

The thing is, your business credit is separate from your personal in most cases. Even if you use your PG to qualify and get approved, 95% of business credit cards will not show up on your personal report unless you default. 


The problem with no personal guarantee business credit is that it takes time to build and it is limited. Without supplying a personal guarantee, you'll typically be limited to just NET30 Vendor credit(30 days to pay back the full balance) with companies like Grainger, ULINE, and Quill or Store Credit cards like Home Depot, Lowes, Floor Decor, Staples, Office Depot etc.. and Fuel cards like BP Gas and Chevron. These are ALL limited forms of credit as you can only spend the credit at that particular store. 


The reality is, most entrepreneurs and business owners have no use for these accounts and actually want REAL Business Credit Cards that are issued from the banks and real business lines of credit and business loans that can be spent anywhere and used to scale their businesses. These types of credit (Business Credit Card, Business Lines of Credit and Business Loans) are referred to as "CASH CREDIT" because they are basically the equivalent of cash, you can spend it as you please without limits like the store cards and gas cards.


ALL CASH CREDIT REQUIRES A PERSONAL GUARANTEE. There is no something for nothing in this world. 


Anyone who says otherwise is probably not being honest with you. If it sounds too good to be true, it's typically because it is. 


If you have good credit then this is good news to you, because you can skip building business credit and rely on your PG for approvals. 


So the big problem is, many people believe that building business credit is a way to tip toe around having personal credit problems. The reality is, if your ok with settling for the limited No PG Store cards and gas cards, I guess you could say it is. 


But the reality is, everyone should invest in themselves and optimizing/repairing their personal credit scores so they can obtain real cash credit and save money on interests rates. 


So ensure you optimize your credit and if it already is optimized, go ahead and get the funds you need for your company without spending tons of time and money building business credit with accounts you don't need. 



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