Getting inquires removed off a so-called business credit card pull.

[Helpmerise]

There is a credit repair company that is getting inquiries for "business" credit cards removed because it's not permissable purpose to pull personal credit for what the banks are touting as a business card. This is a legitimate credit repair company, and they claim anyone can do it. Their parent company that aquires business credit for businesses even offer a do it yourself guide if you hire them.

Is there any case law on this? Can you shed any light? It makes sense, but why haven't I heard of this before? A lawyer also told me he heard of it and it had promise.

[MarvBear]

Corporate credit and business credit are distinct financial tools, each serving different purposes. Let’s delve into their differences:

1. Business Credit Cards:

   • Target Audience: Business credit cards are typically held by small business owners. These cards help cover business expenses and build the business’s credit history.
   • Eligibility: Eligibility for business credit cards varies by lending institution and may depend on the business’s existing credit history or the business owner’s personal credit history.
   • Features:
     • Separation of Expenses: Business credit cards allow owners to keep business expenses separate from personal ones.
     • Credit Profile Building: They contribute to establishing a credit profile and history for the business.
     • Revolving Line of Credit: Business credit cards offer a revolving line of credit for unexpected expenses or large purchases.
     • Rewards and Benefits: Some cards provide rewards programs (such as cash-back incentives), sign-up bonuses, lower initial interest rates, and expense management tools.
     • Travel Perks: Certain cards offer travel benefits like access to airport lounges or hotel discounts.

2. Corporate Credit Cards:

   • Target Audience: Corporate credit cards are designed for larger, more established companies. They can be issued to both owners and employees.
   • Eligibility: Issuers expect companies to have a sizable number of employees or generate substantial revenue.
   • Features:
     • Company Liability: The company is liable for accrued debts or fees on corporate credit cards.
     • Rewards for the Company: Corporate cards earn rewards for the company itself.
     • Business Expense Management: Like business credit cards, they help track business spending and separate it from personal expenses.
     • Quick Access to Capital: Corporate cards provide quick access to capital for business needs.
     • Expense Management Tools: They often come with expense management tools and other benefits.

In summary, while both types of cards facilitate access to capital and expense management, their eligibility criteria, features, and purposes differ. Business credit cards cater to small business owners, whereas corporate credit cards serve larger companies with more employees

[Helpmerise]

Notice in the business card summary nothing is mentioned about both personal and business liability.

[hdporter]

15 minutes ago, Helpmerise said:

Notice in the business card summary nothing is mentioned about both personal and business liability.

 

That's the crux when it comes to a personal credit pull when it comes to a small business card application, isn't it?

 

When such a card agreement contains a personal liability clause, a personal credit pull is warranted, legitimate and authorized.

 

I'd be wary of any enterprise offering to remove credit inquiries.  Once you authorize them to act on your behalf to engage with CRA's, who's to guarantee that the interaction won't potentially impede future interaction with the CRA's (who consider professional "credit repair" activities to be unethical, if not illegal)?

[MarvBear]

31 minutes ago, Helpmerise said:

Notice in the business card summary nothing is mentioned about both personal and business liability.

The absence of explicit mention of both "personal" and "business" liability in a business credit card summary doesn't necessarily guarantee a clear separation of responsibility. It's crucial to exercise caution and dig deeper:

1. Personal Guarantees: Many business credit cards, particularly for startups or businesses with limited credit history, require a personal guarantee from the owner or a principal. This essentially means you're co-signing for the business debt. If the company can't pay, the credit card issuer can come after your personal assets to recover the money. Even if the summary doesn't mention it, check the fine print (terms and conditions) for any mention of a personal guarantee.

2. Business Structure: The type of business structure you have also plays a role. Sole proprietors and partners are generally considered jointly and severally liable for business debts, meaning the creditor can go after any individual for the full amount. While an LLC or corporation offers some limited liability protection, it's important to maintain proper separation between personal and business finances to ensure the protection holds.

3. Reporting to Credit Bureaus: Even if there's no personal guarantee, your business credit card activity might be reported to credit bureaus. This can impact your personal credit score if payments are missed or the debt goes delinquent.

Therefore, it's essential to understand:

• Personal guarantee: Is it required?
• Business structure: What level of liability protection does it offer?
• Credit reporting: Will the activity affect your personal credit score?

[shifter]

1 hour ago, hdporter said:

I'd be wary of any enterprise offering to remove credit inquiries.

Definitely. Besides likely unintended consequences, inquiries don't matter. Removing inquiries does exactly zero to "repair" your credit. Complete waste of time.