Business Owners in Cleveland, Ohio Thank Pat Gage for Tips Shared on How to Start a Business with Less than Perfect Personal Credit
Released on: July 1, 2008, 1:29 am
Press Release Author: Pat Gage
Industry: Financial
Press Release Summary: Effectively managing business and personal credit by keeping them separate
Press Release Body: Many entrepreneurs have great ideas for a new business venture, but are hesitant to get started because they have less than perfect credit. They are positive their personal credit score is going to be a roadblock to their success. Pat Gage says different; he says this is the time to start planning to move forward, in spite of flawed credit.
Pat explained the first thing one needs to do is to find out what their credit score is before approaching any financial institution about a loan. This means getting their report from all three of the major credit-reporting bureaus - Equifax, Experian or TransUnion, to find out exactly where you stand.
Pat explained how to examine the credit report for errors and credit dings; it is not uncommon for it to contain errors like a late payment or missed payment that one knows they made on time and they can prove it. The time to get corrections made is before applying for business funding.
One thing potential lenders really dislike seeing is late or missed payments. If one has a valid reason for that error (family emergency, out of country, hospitalized, etc.), write a letter of explanation to the credit bureau. It's possible to could get it lifted from a report. One can also enlist the services of a credit repair company, if they don't know where or how to start. Pat also says to pay down high interest credit cards to 30% of the credit limit as quickly as possible, and keep these balances under control. A loan officer will does not like to see uncontrollable spending habits.
Pat pointed out that while loan officers look fondly on borrowers with excellent credit, they also appreciate those with less-than-perfect credit who have recognized and corrected the situation. It says a lot about a business owner and their credit worthiness to receive a loan. The key is to start establishing business credit so that personal credit becomes less important. One should start doing this immediately, even if their business is a start up. There are lenders that will loan to start-ups as well as established businesses but only if a business set up correctly as a business and not as a hobby. It's fine to work from your home and still be a legitimate business as long as all the documented information (EIN, State filings, business licenses, business phone number and address) is consistent. This is the key to unlock the doors to business funding.
Pat concluded his presentation with one last word about credit: Do not commingle business and personal credit. Keep credit cards separate, as well as bank accounts. The temptation can be awfully strong to co-mingle, but it's a path you don't want to go down.
Pat Gage, The Opportunity Creator, and a leading expert in the field of business credit has helped a number of clients target his specialty, starting, expanding, and growing their businesses through his trademarked 10 Steps to Money System. The Opportunity Creator is not only a sought after business credit coach but also a national speaker. For more information on any topic discussed, visit Gage's site at http://www.10stepstomoney.com and discover a program for obtaining business credit that works in all 50 states.
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