Establishing A Corporation Building Corporate Credit Without a PG

[princeofvegas 0]

Here is my guide on establishing a corporation and building corporate credit without a personal guarantee. I wil update this guide as information updates but here is is for now and I hope it helps you guys.

Establish the Business

Name Your Company - The first step in this process is to select a company name. Be sure you pick one that has not been selected by another company in your state. Each state differs on how a corporation can be named. Before picking a final name you can check with your states Secretary of State website. "Appendix A" of this document will list the contact information for all fifty Secretary of State's.

Incorporate Your Company - Now that you have selected your business name, you are going to need to establish your corporation with the state of your choosing. You must decide which type or corporation that you would like to form. There are three main types of corporations to choose from. They are General Corporation, Subchapter "S" Corporation and a Limited Liability Company (Please see Appendix . Almost all states require that you use an attorney's office or a registered agent so that there is a physical location on record where processes can be served. You can find many different companies online that can serve as your registered agent as well as take care of the process of filing your paperwork with the state. Some of the more well known companies are:

Incorp Services - ($99 + State Fees)

Free Registered Agent - ($24 + State Fees)

Legal Zoom - ($139 + State Fees)

BizFilings - ($229 + State Fees)

Obtain an EIN - Once you have incorporated your business you will need to obtain a Federal Employer Identification Number. You can file form SS-4 online at the Internal Revenue Service Website. Once you have completed this form you will obtain your EIN in a matter of seconds. Be sure to print it out and write it down because they do not send you an email confirmation. This is the number that you will need in order to apply for credit under your business name without a personal guarantee.

Establish a Location - So now you have your EIN and are incorporated. Your business needs to have a physical location that is not you home address. The UPS store will not work because most creditors have them flagged. An alternative is to get a Virtual Office in your home town. Most of these will supply you with a lease agreement (sometimes needed to get credit), license hanging services, you name on a wall plaque at the location, and mail forwarding services. You should be able to find these services bundled for about $100 per month. In addition, some of these places will even allow you small usage of the buildings conference room and offices for an additional fee. This is great if you just need a completely quite place to work for a few hours or if you need to sign a contract or conduct a board meeting. Some have said that using a home address work fine for most services, however, a separate location is the best bet to keep your personal credit distanced from the business. All these companies need to pull your personal credit is your name and address.

Establish Phone Service - Now that you have a physical location for your business, you will need to establish a utility bill using your newly received EIN and business address. There are many choices for this step of the process.

 

 

Contact your local telephone company and set up a business line for your company. This is the easiest option as it is all inclusive of all of the services that you are going to need. Most providers will have an economy plan that is in the $30 per month price range. Just make sure that the service is at the address you intend to use to apply for credit.

Contact your local telephone company's business sales department and request what they call a Remote Call Forwarding Number. This is a number that the phone company manages on their end and it is forwarded to a number of your choosing. They will usually charge a setup fee and then $10 to $15 per month. Make sure you give them the address of the "office" that you set up and the EIN number. Also make sure that they will list you in the 411 directory under your address, not theirs.

Another method that has been brought up is to get an 800 number and have it forwarded to a number of your choosing. You can then utilize List Yourself to add yourself to your local 411. However, this is not recommended because there is still no free way to list yourself in the national 411 directories that have been found.

One last option that not all local phone providers offer is a foreign 411 Listing. You can contact your local phone company and ask them if they offer a foreign 411 listing service. They will normally charge a small set up fee and a few dollars per month for the listing service. This option is great if you already have an existing number that you want to use but it is not offered by every phone company.

Establish a Checking Account - Once you have all of that in order, you can now open your corporate checking account. Once that is highly recommended is the Washington Mutual Free Business Checking Account. It only requires $100 to open the account, 2 forms of identification (a credit card and state ID will suffice), and your Articles of Incorporation. In some states, the banks will also require that you have a valid business license under your corporation name in order to secure a corporate bank account.

Obtain D-U-N-S Number - Now you need to go to Dun & Bradstreet and obtain a D-U-N-S Number. This process will take about 30 days to get your D-U-N-S Number. DO NOT purchase their credit builder service no matter how much they push it upon you. You are not going to need it. Alternatively you can tell them that you are going to be applying for federal grants or government contracts and receive your number in a matter of days. To apply under the federal program you can go here.

Apply for Credit - Now that you have everything that is required you can go ahead and start applying for credit for your business. You must take it slow and easy however, because one wrong move can cost you plenty of headache and lost time.

Establishing Your Business Credit

Establish your Initial Accounts Once you have everything that is required to apply for credit you can go about establishing your initial accounts. Before you go applying everywhere think again. This is a slow process and your business credit might be flagged or even blocked if you apply to too many places at once. I recommend that you start out with 6 to 8 companies on NET30 terms. Below is a list of companies that offer NET30 Terms. Purchase a small initial order from each of these companies that approved you for NET30. Pay your invoice off well before its due date as that is how the D&B Paydex Score is calculated.

FedEx / Kinkos - May Require a Credit Card to Secure

Quill Corp - Credit Department: 1-800-634-3090

U-Line - Accounting Department: 1-800-295-5510

Veripack - Billing Department: 1-800-225-8255

Rapid Forms - Billing Department: 1-800-257-5287

Reliable - Accounting Department: 1-800-359-5000

UPS - May Require a Credit Card to Secure

Grainger - Customer Service: 1-888-361-8649

Interstate Battery - Online Application

DHL - May Require a Credit Card to Secure

Office Depot - Call 1-800-GO-DEPOT

Gemplers - Billing Department: 1-800-382-8473

Deluxe Checks - Customer Service: 1-800-328-0304

Barnes & Noble - PO Department: 1-212-414-6000

WearGuard / Aramark - Billing Department: 1-800-388-3300

What is a Paydex Score A Paydex score is what D&B uses to tell potential creditors about your payment history and worthiness. It scales from a range from 0 to 100, 100 being the best possible score. You are going to want to keep your Paydex score at or above 80.

100 - Pays before invoice is generated.

90 - Pays during discount period.

80 - Pays when invoice is due.

70 - Pays 15 days beyond terms.

60 - Pays 22 days beyond terms.

50 - Pays 30 days beyond terms.

40 - Pays 60 days beyond terms.

20 - Pays 90 days beyond terms.

UN - Unavailable

Wait for Paydex Score In order to receive a Paydex score, you will need to have five trade lines reporting to D&B. Once you have five reporting you will be assigned your Paydex score. Now that you have this Paydex score you can move on to establishing revolving accounts.

While You Wait While you are waiting for your Paydex score to come through, you should also be able to open a revolving charge account at Staples without having your Paydex score. Most people get approved for $750 right off the bat. You will need to fax them in a copy of your phone bill however or at the very least have your company listed in the 411.

Getting a Cell Phone If you need cellular service for your business you should use you business name and EIN to obtain a cellular phone. Most carriers will approve you for service without any deposits. Some of them are:

T-Mobile - Business Service: 1-888-537-4242

Sprint / Nextel - Business Services: 1-888-788-4727

Alltel Wireless - Business Services: 1-888-428-2499

Building Your Business Credit

 

Establish More Trade Lines Now that you have your Paydex Score you are going to want to begin applying to companies for revolving credit accounts. One thing to note is that you DO NOT want to go on application sprees. This is the WORST thing you can do. It could cause your file to be flagged and blocked at D&B. You should start by applying to just a couple of companies.

Continuing Your Building Always wait a few weeks in between applying for more trade lines and only do one or two at a time. Again is it important to stress that you should NEVER go on application sprees. This affects your business credit just as bad as if you were to do it with your personal credit.

Revolving Credit Companies Here is a list of companies that offer credit on revolving terms (the ones that have been reported has being harder to get are at the bottom). Please remember that if they ask you for a personal guarantee to tell them you do not want to give it. Most times the company will just process the application without it. I am only listing the ones that have been reported as not needing a personal guarantee:

Staples - Apply Online

Office Depot - Apply Online

Walmart - Apply Online

Sams Club - Apply In Store

Frys Electronics - Apply In Store

Home Depot - Apply Online

Lowes - Apply Online

Sears - Apply In Store

Dell Inc - Apply Online

Amazon.com - Apply Online

US Bank Skypass Visa - Apply In Branch

HDMC Group - Apply Online

Target - Apply In Store

Gas Cards Here is a list of gas cards that you can get without a personal guarantee as well. These will come in handy when you are on the road for business :

Conoco / 76 - Apply Online

Shell Gasoline - Apply Online

Exxon / Mobile - Apply Online

Chevron - Apply In Store

Sunoco - Apply In Store

[Xalor 0]

You are an amazing guild writer. I saw this before and its really good. I never knew the role of a phone number and all these little miniscule things that you need to have to set up a good business. I always wondered that 1-800 numbers were really that simple to obtain. Just check over your other forum BBCode since its slightly off. I am looking forward for the total one in a e-book, leave this here though so the myCENTS for the post is added to your account otherwise its going to be messed up and you will lose it in the future.