Unsecured Business Credit Cards
Do you want 4-5 unsecured business credit cards that only report to the business credit reporting agencies?
You’re probably familiar with our popular business credit cards funding program where we get you multiple business credit cards issued in your company’s name. In fact, this program is one of the best ways to speed up the business credit building process.
Not too long ago we shared the top 5 business credit building hacks and this particular strategy was on the top of the list.
In today’s post we’re going to cover several issues that may occur with a business name when it comes to our business credit card funding program. But before we get started if you haven’t done so already you should check out last week’s post where we discussed the 5 credit report issues that trigger business credit line denials.
That particular post is a must read and transitions right into today’s post about funding issues that may get triggered because of a business name.
Now when it comes to choosing a name for your business, not only should you do your due diligence such as trademark search, domain name search, etc. but there are other factors to consider as well.
First, let’s start with how a bank can consider your business as a high risk simply from its name. The way it works is banks classify certain industries as high risk due to the very nature of the industry the business operates in. Industries such as real estate, financial services, gambling, etc. are considered high risk therefore banks tend to avoid lending to them.
If you name a business associated with a high-risk industry such as John Doe Real Estate or John Doe Investments or John Doe Real Estate Holdings, etc. it’s an easy way to trigger a red flag with a bank. Those types of business names clearly show that your business operates in what’s considered a high-risk industry.
Now don’t worry if you already have a business name selected and it’s a high-risk name. We have had many businesses with the word ‘real estate’ and ‘investments’ in the company name get favorable results in credit limit approvals through our program.
However, if you’re in the process of naming your business it’s best to select a business name not associated with a high-risk industry.
Secondly, did you know having your own personal name as part of your business name may impact business credit card funding when using a business credit partner? This is a major issue that occurs when the company is named after an individual but the applicant applying for business credit lines for the business is not that individual.
What happens is the bank will want to verify the owners of the company because the applicant’s name does not match the individual’s name stated in the company’s name. In fact, if the applicant does not have an ownership percentage in the business than the bank will most likely question why the owner isn’t the one applying on behalf of the company.
Now remember, this issue occurs when a person’s name is part of the company name and the applicant is not that person applying for business credit lines. For example, let’s say the company’s name is John Doe Enterprises but the individual applying for business credit card funding is a credit partner named Bob Smith.
As you can see the company’s owner John Doe is clearly visible in the business name but the one applying on behalf of the company is Bob Smith so the name does not match. This is clearly something that will cause an underwriter to take a second look and require some clarification.
This doesn’t necessarily mean that the business will get denied for business credit cards through our program but it may trigger a red flag causing a more rigorous approval process that could have been easily avoided.
So, at the end of the day if you want to avoid this type of issue especially if you plan to use credit partners or take on other business partners don’t include your personal name in your company’s name.
Remember, your business name plays a huge role in your brand’s growth and perception. It sums up what your company is about and deserves time and attention. It’s not only the first thing customers see, it’s also the first thing an underwriter sees when you submit an application for credit or funding.
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About the author
Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. He is a business credit blogger for Dun and Bradstreet Credibility Corp, the SBA.gov Community, Business.com, About.com and All Business.com. His articles and blog; Business Credit Blogger.com, have been featured in ‘Fox Small Business’, ‘American Express Small Business’, ‘Business Week’, ‘The Washington Post’, ‘The New York Times’, ‘The San Francisco Tribune’,‘Alltop’, and ‘Entrepreneur Connect’.