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Credit Tips for Entrepreneurs

4/30/2018

12 Comments

 
By Brando Sencion, Program Coordinator of Community Ventures 

​For many entrepreneurs trying to start their own business credit is essential. Lacking credit can be a major setback for entrepreneurs willing to start businesses. The lack of credit means no access to loans, business wholesale accounts, leasing equipment or space, and more. So where should you start? Here are 3 ways to establish and improve credit.
 
OBTAIN CREDIT REPORT
Before you start to build your credit, it is important to obtain a copy of your credit report. Your credit report has information on where you live, how you pay your bills, and more. The report helps creditors, employers, and other businesses evaluate if you are a good candidate. Make sure the information is accurate, complete, and up-to-date. If you find any inaccuracy or incomplete information, be sure to correct it. Corrections of errors can help improve your credit history. 

APPLY FOR A SECURE CREDIT CARD
We all have to start somewhere, and a secured credit card is a great option. A secured card is backed by a cash deposit you make when opening the account. The deposit will determine the credit limit on the card. You’ll use the card as any credit card. There will be interest and payment dates. However, the only difference is you opened it with a deposit to secure the account. After a few months, the financial institution will remove the safety net and offer you a credit card with no deposit required. Now that you have learned to use a credit card and have built history with a financial institution, you can continue to build your credit with other lenders.
 
PAY AT LEAST THE MINIMUM, PAY ON TIME
If you already have credit history, but it is not enough to qualify you for the lines of credit you need. Focus on building your credit with good habits. Building credit is a slow process and can take up to 6 months or a year to get within a desirable credit range. A good habit is to pay at least the minimum due on your bills and paying them on time. Payments make 35% of your credit score and heavily weigh on your credit history. Furthermore, keep credit utilization low, the balance and your credit limit should be at a healthy ratio. If existing debt is a problem, work to pay down the debts of credit accounts with the highest interest or lowest balance. Additionally, always pay more than the minimum amount, this will pay debts down faster and reduce interest build up over longer periods.
​
12 Comments
Ram Nair link
10/25/2018 03:03:24 am

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home loans Melbourne link
6/19/2023 04:06:25 am

Convenience in borrowing power makes the loan application, approval, and management processes more efficient, user-friendly, and accessible.

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Britney K link
11/13/2023 08:26:31 am

This is a great posst thanks

Reply
SMall Business Technology Finance link
5/17/2024 04:32:22 pm

Good information shared on best practices. Using technology and software to educate and assist small businesses

Reply
Veronica Dantas link
9/24/2024 12:41:34 am

Brilliant blog, thank you for sharing your expertise!

Reply
Daniel Dantas link
10/3/2024 12:59:06 am

This was a great reminder, thanks!

Reply
Global Talent Pathway link
11/13/2024 08:26:02 am

This blog provides invaluable insights into managing credit effectively as an entrepreneur. The tips are practical, easy to understand, and essential for anyone looking to build a strong financial foundation for their business. I particularly appreciate the emphasis on maintaining a good credit score and managing debt wisely. A must-read for aspiring business owners!

Reply
Luiz Gustavo Mori link
11/26/2024 07:59:10 am

Great insights! This blog offers valuable advice for entrepreneurs looking to navigate the complexities of credit. The tips on building and maintaining good credit are practical and essential for long-term business success. Thanks for sharing such helpful information!

Reply
HVAC filters link
12/18/2024 05:39:34 am

Great tips! As an entrepreneur, managing credit is crucial for success. These tips are really helpful in understanding how to maintain a healthy credit score and leverage it effectively. Thanks for sharing these insights!

Reply
Merv Rating link
12/25/2024 10:08:21 pm

These credit tips are invaluable for entrepreneurs looking to build a strong financial foundation. Managing credit wisely is key to long-term business success!

Reply
Solar Panel Cleaning link
1/1/2025 08:15:43 am

Great tips for entrepreneurs! Managing credit effectively is crucial for business success. Keeping track of expenses, maintaining a good credit score, and utilizing credit wisely can help secure financing and grow a business. Practical advice that every entrepreneur should follow for financial stability and growth.

Reply
Sell Your House link
4/1/2025 12:01:46 am

Great advice! I love how the article breaks down credit building into simple steps. A must-read for any new business owner.

Reply



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