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WEB/DIGITAL Building Business Credit-Opportunities

Discussion in 'Business Models, Niches, Industries' started by Starsky, Sep 8, 2007.

  1. Starsky
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    Starsky New Contributor

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    To tie in with the post MJ made about being a prepared to seize opportunities that come your way, I thought about an area i dont see discussed much but is very important.

    In starting a business(real estate included) most people bootstrap using their own finances & credit. However on my path i always wondered how I could purchase things & have unsecured lines of credit in my companies name, instead of my personal. Over on another board, a guru charges over $500/1000 dollars a chair to teach you how to obtain lines of credit from banks...

    After some research, I was able to obtain in a short amount of time over $50K of unsecured credit lines to tap in case opportunities pop up. All of the lines are in my corporations name. None of those lines of credit appear on my credit reports, which will not lower your score due to high debt to income ratio.

    Others who have business lines of credit or those that need it lets share on this topic.
     
  2. nomadjanet
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    nomadjanet Contributor

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    We have a line of credit in our service company name. With our first business we let banks bully us into giving a "personal garanty" every time we wanted credit. Now we just say, that's ok will just go to a different bank. We also have high limit credit cards in both our service company (corp) name & our real estate L.P. name.
     
  3. Allthingznew
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    Allthingznew Contributor

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    Last May I started my own business, and I have been inundated with credit offers. Of course they're all card cards, but credit none the less.

    I think what you said is key, it is easier for corporations to get lines of credit and larger ones at that than an individual or partnership, and a corporation protects you personally.

    I used to work for a larger developer in my area and I saw him have to personally guarantee almost all his loans. His business was a partnership with his sister.

    He had several companies 3 in the restaurant field, one in real estate, and one in concenience stores, and every time he went for a loan, which was very often because he was always acquiring and bulding something, he would bury the bank in his financials.

    He would send the bank all the statements on every company dating back to it's origin. This was a full box of 6" thick binders that weighed probably 50lbs, and it's probably doubled in size now since the last I worked for him was 2002.

    His bankers kept telling me they didn't need all that info, but he made me send it anyway, and he usually always got the loan. And his companies were all robbing Peter to pay Paul he was stretched so thin, he was in bad shape financially. It was the over inflated market that kept his house of cards from falling. My point is, the banks, yes he had several, the banks kept giving him the money.
     
  4. NoMoneyDown
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    NoMoneyDown Contributor Read Millionaire Fastlane

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    I've heard of companies who create "shell" businesses solely for the purpose of selling them years later for a profit. The concept is that since the business has "aged" it is easier to get credit lines and people don't have to wait years for the business to mature to get them. Anyone heard of this before?
     
  5. Starsky
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    Starsky New Contributor

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    Cant say im familiar, however it sounds like the same scheme as charging people to increase their credit scores within a month by allowing them to become an authorized user on your good credit card with a long history.

    Even if you have to pg initially, its worth it to form the relationships that lead to increased creditlines that do not report on your credit report.
     

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