Small business owners are becoming acutely aware of the importance of establishing business credit scores that are completely separate from their personal credit scores.

In addition, many have found this to be a viable solution to overcome personal credit challenges that prevent them from obtaining credit.

While strong company credit files and scores can open the doors for various types of financing business owners should continue to work on improving personal credit scores as well.

This can benefit their business in several ways:

First, with good credit scores you have more choices for obtaining funding simply from the fact that certain lenders require a personal credit check as part of their approval process.

Secondly, it strengthens the credit picture of your business overall as many lenders will consider your personal credit scores as a strong indicator to how you will handle your company's financial obligations.

Finally, a potential business partner or investor will look at your personal credit scores as a factor for determining how financially responsible you are.

This alone should bring you to the conclusion that raising credit scores is not only good for your business today but it's also vital to its long term growth as well.

Here are several strategies that you can apply for increasing your scores:

*Become an Authorized User - If your spouse has an existing aged credit card account then add yourself as an authorized user on that account. As an Authorized User you gain all the credit history of that particular account as if you had been on the account since it originally opened.

Keep in mind your credit history does not affect your spouse's account, but any activity, negative or positive from the Main Account Holder (your spouse) will affect you the Authorized User.

*Pay More than the Minimum - Add $10.00 or more on top of your minimum monthly payment and make three payments a month with each payment received ten days apart from one another.

By making a payment higher than your minimum payment and increasing the frequency of payments triggers the positive action or activity on your account. The system will automatically report "More than Minimum Payment Made "to the credit agencies.

The frequency of your payment lets the creditor know you can afford MORE than your current credit line. This triggers two things.

1. It triggers the internal system of the creditor to offer you a higher credit limit automatically in about 6 months. Credit Card companies do not like receiving more than one payment a month so since the best customer to a creditor is one that's always in debt they will entice you to use more credit by increasing the limit.
2. The credit scoring system (FICO) will calculate more positive action in one month rather than just once a month and give you points for every payment you do make.

While there are many more strategies for improving credit scores pay close attention to some of the more obvious ones. This includes maintaining a 30% debt to credit limit ratio on credit card accounts as well as correcting any errors or obsolete information you uncover on your reports. You can always choose to enroll in a reputable credit repair service as an alternative to doing it yourself.

Even though every business owner has a unique file with all types of factors that make up their scores these simple yet powerful strategies can give you that extra boost you need so your business can reap all the benefits.

About the author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A business credit solutions membership helping business owners build small business credit. He is a business credit blogger for AllBusiness.com, a subsidiary of Dun and Bradstreet and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in American Express Small Business, Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

Having a tough time finding funding for real estate investing? It's no secret that one of the main reasons businesses fail is lack of capital.

So to help better prepare yourself for success in your new business venture I've put together a few tips and funding options you may find useful.

One of the key things you should first determine is how much funding you need to not only start your business but also stay in business too. Don't make the mistake of underestimating these numbers by projecting unrealistic revenues.

Next, plan a short term and long term startup business credit strategy which consists of funding the launch of your business (short term) and building your business credit files (long term).

Starting a new business involves risk and limiting the use of your personal credit and personal guarantee should be a priority for you.

Unfortunately, many business owners and real estate investors fail to build business credit separate from their personal credit right from the onset. As a result they find themselves back peddling and end up relying on their personal credit to finance the growth and expansion of their business and real estate investment portfolio.

Only after they exceeded their personal credit capacity do they realize that building business credit should have been part of their overall strategy. Don't let this happen to you!

Some of the more popular options you have for startup business financing (short term) include:

P2P Loans

Microfinance Loans

Social Loans

Loans for Small Business

Business Credit Cards

Startup Business Grants

By also building your business credit files (long term) your business will be in a position to qualify for its own financing at much larger amounts without using your personal credit or personal guarantee.

Some of the funding sources that result from building business credit (long term) include:

Vendor Credit Lines

No Personal Guarantee Business Credit Cards

Business Line of Credit

Equipment Leases

Fleet Programs

Remember, you can obtain 10 to 100 time's greater business financing with a strong business credit file than you could using your personal credit.

When you compare business credit vs. personal credit there are many serious things to consider including protecting the corporate veil.

Finding funding for your new small business can seem like a serious challenge in today's economic environment especially if you resort to conventional means. There are many creative business financing options available so don't get discouraged.

Part of building a successful business is putting a sound business financing strategy in place for both the short term and long term needs of your business. By doing so you can overcome one of the most common factors that cause businesses to fail which is lack of capital.

Ready to start building business credit for your real estate investing? Become a member of my Business Credit Insiders Circle and gain access to a proven step-by-step business credit building system. A system that provides you access to vendor lines of credit, business credit cards with no personal guarantee, funding sources and lenders that report to all the major business credit bureaus.

About the Author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A step-by-step business credit building system providing business credit with no personal guarantee. He is a business credit blogger for AllBusiness.com, a subsidiary of Dun and Bradstreet and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in American Express Small Business, Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

I'm sure we can agree that for far too long real estate investors have relied on the strength of their personal credit to dictate their ability to obtain funding for their real estate investing.

Unfortunately this dependence can be easily avoided if more investors knew about the advantages that business credit provides.

To provide some insight I have assembled some of the key advantages of business credit compared to personal credit that I know will get your attention:

Social Security vs. Federal Tax ID

Your social security number (SSN) is your personal unique nine-digit number issued to you so you can pay taxes and pay into the social security system. It's also used by the credit reporting agencies in the creation of your personal credit files.

A Federal Tax ID Number (EIN) is the corporate equivalent to a social security number. It's a nine-digit number assigned by the IRS to business entities operating in the U.S. in order to identify each company.

The major difference here is even though you are issued only one social security number as an individual as a business owner you can obtain multiple Federal Tax ID numbers if you own multiple companies.

Single Personal Credit File vs. Unlimited Company Files

Now this is the part where it gets really exciting because while you have only one consumer credit file linked to your SSN you have the ability to create and establish multiple business credit files with the business credit bureaus.

You can accomplish this because each company you incorporate has its own individual identity separate from that of its owners. Each business can obtain its own unique Federal Tax ID number allowing it to build its own unique credit file as well!

Limited Credit Capacity vs. Unlimited Credit Capacity

If you're like most real estate investors who rely on their personal credit to fund purchases or even fix up properties than you'll really get a kick out of this one.

Did you know that business credit has 10 to 100 time's greater credit capacity then personal credit?

When you use personal credit to apply for financing your mortgage, auto loan, credit cards and even student loans are affecting your ability to qualify.

But when you take advantage of business credit reports you truly get to leverage the power of your business. Your files include your company's payment history and may include revenues, assets and company financials depending on how much information you furnish to the business credit bureaus. In addition your files will not show your personal debts or personal financial obligations.

What's even more exciting is if you own several companies each of the businesses will have its own credit capacity giving you unlimited financing potential.

FICO® Credit Score vs. Paydex

Now I know there are many different scoring models out there but the most widely used on the consumer side is FICO® so for simplicity let's cover that one.

The FICO® scoring system has eighty-eight negative rating factors that can hurt your personal credit score and only six positive ones. What's even worse is you only have control over five of them so needless to say you're fighting an uphill battle on the consumer side.

However, one of the main business credit bureaus known as Dun and Bradstreet issues its own business credit score known as paydex. This score is primarily based on how your business pays its bills and it's much easier to understand and maintain compared to FICO®.

As you can see business credit will always trump personal credit and if you are just starting to launch a business or run an existing one now is the time to utilize one of the best kept secrets in the business world.

Ready to start building business credit? Become a member of my Business Credit Insiders Circle and gain access to a proven step-by-step business credit building system. A system that provides you access to premium vendors, business credit cards, funding sources and lenders that report to all the major business credit bureaus.

About the author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A business credit building program for small business owners. He is a business credit blogger for All Business.com, a subsidiary of D&B, and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in American Express Small Business, Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

Business Credit is borrowed money that your company can use to purchase products or services it needs and repay the funds at an agreed upon date or time frame.  It can also refer to the amount of capital your business can secure without the use of personal assets. 

The good news for you is that businesses of all sizes and entity types have the ability to create its own corporate credit identity completely separate from that of its owners.

Unfortunately most entrepreneurs are not aware of this and operate as a sole proprietorship which is a form of business structure in which the individual takes on all aspects of funding, starting and operating the business.

As a sole proprietor you keep all the net profits but you're also taxed on them too. This is why entrepreneurs often rely on the strength of their personal credit reports to determine the amount of financing they are able to obtain for their business.

Unless you incorporate the IRS will automatically default your business as a sole proprietorship leaving you personally liable for all debts and actions made by the company.

By incorporating your business it now gets to be treated as a separate legal entity like a human being created through a legal process.

Similar to a social security number which is tied to your consumer credit files your business can obtain a Federal Tax Identification Number and establish its own business credit report.

Once you begin building business credit you can obtain everything from equipment, office furniture, supplies, and inventory or even lease automobiles through corporate fleet programs.

You should limit the use of your personal credit or guarantee by applying for vendor credit and if you apply for other sources of financing like a business line of credit then you will also need to maintain a solid bank rating too.

Business credit cards are another source of credit that your company can obtain with each card containing its own approval criteria and terms and conditions. Some cards may not be a good fit especially the ones who base its approval and payment reporting on the owner's personal credit and not the business.

Your company can also apply for business loans which are either secured or unsecured and are traditionally funded by banks.

Each of these sources of business credit can provide the short or long term capital your business needs while protecting your personal credit and personal liability.

While it does take time to build a creditworthy company you can expect to save more money and obtain much greater financing than you would ever personally.

About the Author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A business credit building system for small business owners. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

While microcredit loans first originated in the Third World as a way to help launch small businesses thousands of American entrepreneurs are finding it as the alternative solution to traditional lending.

Many of the micro lenders, which are mostly non profits, receive the bulk of its funds from the Small Business Administration. 

In order for these micro lenders (intermediaries) to loan money to micro borrowers there are specific funding and training guidelines set by the SBA.   

One of the reasons why this funding option has become so attractive to entrepreneurs is because it's less difficult and time intensive to qualify for this small loan which ranges from $500 to as high as $35k compared to the traditional lending route.

This new age of micro loans for small business offers a variety of special benefits that I've broken down for you into the following:

Business Training

The SBA requires that intermediary lenders provide business training and technical support to its borrowers. This educational component that micro borrowers will need to complete before the application is accepted is a step in the right direction.

By adding sound business training and planning more start ups can avoid making costly mistakes resulting in successful loan repayments and building a solid credit history in the process.

Flexible Requirements

Another area that makes these microcredit loans so attractive is the flexible guidelines for loan approvals. While many lenders are unwilling to approve a loan unless you have pristine credit, business history and sufficient collateral micro lenders take other factors into consideration.

This may include personal collateral and a personal guarantee but what truly separates micro lenders from traditional lenders is the personal character component. Micro lenders take a more hands on approach with their borrowers and go so far as to even contact personal references.

Building Credit

Microfinance loans also provide a way for small business owners to build or rebuild personal credit history and raise credit scores. Many applicants have little to no credit history and do not have the collateral that typical businesses use to secure a loan like commercial real estate, accounts receivables or inventory.

As you make payments on your small loan the micro lender reports its payment experience with you to the credit bureaus. This builds positive credit history and increases your level of creditworthiness in the eyes of lenders.

Once a micro loan is paid in full then most micro borrowers are able to qualify for greater amounts of financing through traditional sources if they prefer.

Time

Time is of the essence especially if you are in need of funds for working capital. Waiting for a traditional loan backed by the SBA can take months where microfinance loans can take as little as 14 days to fund.

Keep in mind that each micro lender has its own lending requirements and it handles its own approvals at a local level. You can find more information on SBA's Guaranteed Loan Programs and a list of approved micro lenders nearest you at the SBA web site.

Some additional micro lenders you may want to consider reviewing are Accion, Kiva, Prosper, Zopa and Lending Club. Each of these lenders has its own requirements, lending limits and interest rates so take the times to review which one best fits your needs and comfort level.

The recent economic crisis created a huge demand for this new age of finance called micro lending. With the SBA stepping up to the plate and allocating $50 million in funding for its micro loan program it's no surprise that this financing option is going mainstream.

Whether you're just beginning your first business venture or need the working capital for an existing business, this small loan may just be the solution you've been looking for.

Looking for more funding sources to launch or grow your business? Become a member of the Business Credit Insiders Circle and gain access to a proven step by step business credit building system.

About the Author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A web based membership helping business owners obtain business credit with no personal guarantee. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

What is the best way to describe the principle business activity for your company? What type of industry are you involved in? What type of products or services do you sell? These are questions quickly determined by the type of business sic codes assigned to your company.

The two types of business classification systems used today is the SIC and NAICS codes.

Lenders, insurance companies and business credit bureaus use these systems to determine if your business is in a high risk industry classification. Some small business sic codes can trigger automatic turndowns, higher premiums and reduced credit limit recommendations on your business credit files.

The internal revenue service uses it to determine whether your business tax returns are comparable to other businesses within your industry. If your deductions do not resemble other comparable businesses there's a chance of your business receiving an audit.

Don't worry because you can avoid being labeled as a high risk by first understanding how the business classification system works and secondly by selecting the proper code for your business.

An SIC code (Standard Industrial Classification) is a four digit numerical code assigned by the U.S. government to businesses in order to identify the primary activity of the business. The first two digits of the code identify the major industry group, the third digit identifies the industry group and the fourth digit identifies the industry.

For example:

36 ELECTRONIC & OTHER ELECTRIC EQUIPTMENT

367 ELECTRONIC COMPONENTS & ACCESSORIES

3672 PRINTED CIRCUIT BOARDS

The NAICS (North American Industy Classification) replaced the SIC code back in 1997. This took the 4-digit (SIC) code to a 6-digit (NAICS) code system.

The main reason why this new system was introduced was because the SIC classifications were outdated and didn't represent some of the new industries that have re-shaped our country and global economy.

Both of these codes are universal numbering systems that help identify what industry your company is in and breaks it down into more detailed segments. While the old business SIC codes are still widely used, the Federal Government no longer supports and maintains the system.

For business credit building purposes you need to select an SIC code for your company because Dun & Bradstreet continues to use SIC codes to this day. You'll be required to furnish this SIC code when setting up your business credit report with DNB so be sure to record the number you select for your records.

Before you select an SIC code and NAICS code there are certain industries or codes that are flagged as high risk. Here are a few of the codes to stay away from relating to the following industries:

*Real estate investing or anything else regarding investing of any type

*Car sales

*Adult entertainment

*Travel industry

*Money lending/collecting

*Restaurants

*Dry Cleaners

If you plan on investing in real estate then you will want to make sure that the company you build credit on is not "real estate investing". Most banks will automatically turn you down because this is a high risk category.

You still will be able to invest in real estate but you may have to set up a business that does business development, business management, business consulting, marketing & advertising, training and development, etc. and then operate your real estate investments from a separate division or company that does something else.

As you can see selecting the wrong business sic and naics codes can get your business labeled as a high risk and directly impact your financing ability, insurance premiums, and credit limit recommendations.

Don't make this small mistake that can cost your business future problems.

About the Author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop and Entrepreneur Connect. Are you willing to follow a step-by-step business credit building system so you can avoid costly mistakes like these? Become a member and start building business credit today.

While traditional lenders have been sticking to their strict underwriting guidelines there are several creative business financing tips that may just help get you the funds you need. 

Before getting into the details let me be the first to remind you that separating your personal credit from your business credit should be your primary goal. If you're at the early stages of building your company's credit file then you may have to use your personal credit to secure financing until your company becomes creditworthy.

Merchant Cash Advance

This option has many benefits if you are in need of short term business financing. In a nutshell you are borrowing against future credit card sales in order to receive cash immediately.

Best of all you can qualify with bad credit, no personal guarantee and no collateral.

Some of the requirements are:

• At least 9 months in business
• Process $5k or more in monthly credit card sales

Finally your repayment is based only on your credit card sales and it's automatically debited so you don't even have to worry about a payment schedule.

Social Lending

Lending networks like Lending Club and Prosper provide a way for you to obtain creative business loans that range from $1k to $25k for your business. Rather than go through the red tape that traditional lenders impose these networks make the process so much easier. You simply post a loan listing and set the rate you want to pay and they do the rest.

The rate is fixed and so are your payments but best of all you don't have to take the loan if you don't like the rate.

Some of the requirements are:

• Personal credit score of 640+ for Prosper
• Personal credit score of 660+ for Lending Club
• Debt-to-income ratio of 25% (excluding mortgage)

Even though you're securing the loan using your personal credit the interest rate you will pay is much less than the rate you will pay if you use your personal credit cards for funding.

Vendor Lines of Credit

Another alternative to creative business loans is obtaining vendor credit from your suppliers and other companies whose products and services you can use. This not only helps you conserve cash flow but also builds your corporate credit file too.

In most cases you can qualify with no personal credit check or guarantee which supports your overall business credit building strategy.

Equipment Leasing

When you need business financing for business equipment and you can't secure finances through traditional sources like a bank than leasing is a viable alternative. You not only benefit from tax deductible lease payments but you also can get a buy-out option as well.

In addition you get a low fixed rate and a low down payment which is usually one or two lease payments upfront. Compared that to a traditional loan, where a bank requires up to 20% down of the total price of the equipment.

As you can see there are many creative business financing options that will provide your business the financing it needs short term or long term while you continue to work on establishing the creditworthiness of your company.

Looking to access creative business financing sources? Become a member of my Business Credit Insiders Circle and gain access to a proven step by step business credit building system? A system that provides you access to premium vendors, business credit cards, funding sources and lenders that report to all the major business credit bureaus.

About the Author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A step-by-step business credit building system helping business owners establish business credit with no personal guarantee. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

If you hope to qualify for financing for your business without having to use your personal credit then building a solid company foundation with positive business credit history is mandatory.

Here is a brief overview of the steps you will take to move you through the process and get your company on the path to obtaining the funding it needs based on its own creditworthiness.

Shelf Corporations

If you think purchasing shelf corporations will open up the credit floodgates for your company think again! These aged corporations provide the perception of years in business which is important in the eyes of lenders and customers. But there is a lot more to building corporate credit then age alone but if you do decide to purchase one make sure it's reasonably priced and at least two years old with no liabilities attached.

Dun & Bradstreet

Once you have a corporation set up and completed all the necessary corporate conformity guidelines including but not limited to 411 listings, verifications and licenses you will be ready to register with Dun & Bradstreet.

Establish Business Credit

Once your registered you will need to establish business credit by first applying for vendor credit accounts with companies that report on a monthly basis. Once you get approved and start making purchases make sure to pay your invoices on time and monitor your files.

To get listed with Corporate Experian and Equifax Small Business you will need to establish accounts with companies that report to these specific bureaus.

Business Credit Cards

One of the ways you can start establishing business credit is through a secured card. This helps prevent your company from incurring any revolving debt so it's a good place to start but as you continue building business credit you may soon qualify for no personal guarantee business credit cards.

If you must apply for business credit cards that requires your personal guarantee be sure that it reports your payment history to your business credit files and not your personal credit reports.

Small Business Loans

Obtaining small business loans can be difficult but it's not impossible. It really depends on the level of bank credit that you have established. I would first focus on securing a business line of credit for your company so you can have the funds readily available when needed. This is much more convenient then having to apply for a loan every time your business needs the funds.

Business Credit Information

Finally you should stay plugged in and up to date with the latest news, resources and business credit information so your company can continue to expand its funding capabilities as well as leverage its diversity of credit.

Building business credit is not something you should spend your precious time or resources trying to figure out. It's simply smart business to utilize a system that can take you through the process. With the right plan and execution of that plan you can expect your company to qualify for business financing without having to put your personal credit and personal assets at risk.

Looking to access a proven step by step business credit building system? A system that provides you access to premium vendors, business credit cards, funding sources and lenders that report to all the major business credit bureaus? Become a member of my Business Credit Insiders Circle and start building business credit for your company today.

About the Author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. An online business credit building system that helps business owners build business credit with no personal guarantee. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

In the business world, a strong FICO credit score rating is necessary during the early stages of business financing especially if your business credit files are not strong enough.

Due to the current economy and credit markets, banks and lenders are looking at both personal FICO scores and business credit scores. Now keep in mind that if your business credit report can stand on its own they may not require a personal guarantee but can still check your credit scores as part of their underwriting process.

By raising credit scores for both you and your business, you can expect to have much more cash credit and resources available to your company at better interest rates and terms.

One particular product that I suggest to clients in my business credit practice has proven to increase a FICO credit score rating 95% of the time in as little as 60 days, which you and I know is pretty fast.

I'm sure you'll agree that there are quite a few services out there that promise to raise credit scores, but this is one of the few that really does get the job done.

So how does it work?

First you will need to decide what amount of credit you are looking to add to your personal credit files. Remember the larger the credit line the greater the impact it will have on dropping your debt to credit limit ratios. Currently the unsecured line of credit options range from $5k, $6k, $7,500 and $10k.

Next step is simply opening an account and making a small advance purchase based on the amount of credit you want. For example, if you select the $5k line of credit then you will need to purchase $295 worth of products.

What I really like about this program is that from your advance purchase you get to select from thousands of dollars of merchandise items on their website. So for simply purchasing $295 worth of products you are automatically receiving a $5k unsecured line of credit that reports to your personal credit report with Transunion and Equifax.

Now that's what I call a solid offer for raising credit scores! Imagine if a store like Best Buy offered its customers a $5k line of credit if they made an initial purchase of $295 at its store. I know that sounds far-fetched but I'm just trying to make a point.

Once your set up you can continue to use this line of credit towards the purchase of over 4,000 books and 5,000 music selections and it's important that you do so you can continue to build positive payment history.

I also like the fact that they offer a payment option if the $295 is a bit of a stretch for you. You can pay $195 down and $20 a month for 10 months.  Once you enroll you'll receive a welcome package which includes a bonus cd and payment coupons if you select the payment option.

You can apply for this $5k line of credit online but if you want a greater amount then you will need to fax or email a full credit report first.

By taking advantage of raising credit scores with programs like this and optimizing your scores with the credit rating bureaus the benefits for you on a personal and business level can be very rewarding. Your credit report and scores have the power to lower interest rates, give you better terms on loans and put more money back in your pockets.

About the Author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. A business credit builder membership helping business owners build business credit. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a business credit blogger for All Business & American Express Small Business and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain. 

Qualifying for a bank loan or other traditional sources of business financing can seem like an impossible task if you're like most real estate investors that haven't even begun to establish credit in the name of your business let alone have any type of business credit scores.

You probably believe that you have no other choice but to use your personal credit for your real estate investing but let me share with you a viable alternative before you slap down your plastic.

Vendor credit lines also known as trade credit is when a company extends credit to your company in order to allow you to buy its products and services upfront but defer the payment for a later date.

After you purchase a product they will issue an invoice which must be paid according to the terms of your agreement. If you're a startup company or have no business credit then most vendors will have net 10 or net 15 day terms. Keep in mind these terms can be extended to 90 or even 120 day terms if you continue to build a solid payment history with your vendors.

Some of the major benefits include:

• Conserving Cash Flow - By purchasing products or services and deferring the payments for a later date your business is able to conserve cash and have the funds it may need for other important expenses. Imagine being able to purchase all the materials you need to renovate a property using your vendor credit lines! No personal impact on your credit and best of all you don't have to pay the invoice until 30, 60 or sometimes 90 days. Does that give you enough time to flip the property?
• Establish Business Credit Scores - As each invoice is paid on time you begin establishing a positive payment history on your company's credit files. Remember it takes a minimum of four accounts reporting to generate business credit scores with Dun & Bradstreet.
• Improve Credit Capacity - When your vendor credit limits increase so does your company's overall credit capacity. Larger credit limits showing on your files will improve the overall creditworthiness of your business simply from the fact that banks and lenders will see that other companies are willing to extend credit to you in much larger amounts.
• No Personal Credit Check or Guarantee - The majority of vendors will not require a personal credit check or guarantee which clearly protects your personal scores and liability. How many real estate investors do you know that have all their expenses tied up from using their personal credit?

Now for business credit building purposes there are some key factors that never get mentioned which can make all the difference in the world.

You see not all vendors report your payment history, in fact out of half a million vendors in the U.S. less than 6,000 supply payment data to a business credit bureau.  So either you should select the right companies to apply with or you can always purchase one of DNBs trade reference programs.

Several other factors to consider are the frequency of reporting and how the data is being reported by your vendors. Some report on a quarterly or even yearly basis which does not help in building your profile in a timely manner.

As far as your payment data it's vital that the actual vendor credit limits that your company is approved for displays on your file not just the amount owed. Some vendors will not report this information and it can have a dramatic impact on how lenders view your company's creditworthiness plus it affects the size of the credit limit recommendations that business credit bureaus list on your file.

I know this can seem confusing and time intensive but there are ways to streamline this whole process taking all the guesswork and frustration out of the equation. By taking advantage of all the tools and resources available you can improve your company's ability to qualify for the business financing it needs.

Looking to access vendor credit lines and cash credit sources that report to all the major business credit bureaus? Become a member of my Business Credit Insiders Circle.

Marco Carbajo is a business credit specialist, author, speaker, and founder of the Business Credit Insiders Circle. A business credit builder system helping business owners build business credit without a personal guarantee. He is a weekly columnist for Dun & Bradstreet Small Business Solutions, a blogger for All Business & American Express Small Business and author of "Eight Steps to Ultimate Business Credit" and "How to Build Business Credit with No Personal Guarantee." His articles and blogs have also been featured in Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.