How To Build Business Credit With Your EIN

When it comes to operating a business, most new business owners find it challenging to receive capital. Fortunately, there is an option to receive business funding without being a personal guarantee or using your Social Security number as collateral.

If you are a new business owner who needs to build credit in order to obtain future financing separate from your business, you will need to build business credit using your business’ EIN. Click here to check your FICO score for a $1.

Establish business foundation

First, make sure that your business is legitimate by registering it with your secretary of state. After your business has been approved, you will need to register with IRS.GOV to obtain your EIN number. Which is kind of like a social security for your business when it comes to opening a bank account and filing for taxes.

You also need to apply for a DUNS number, which is a number that is used to establish your D&B file to help lenders view your business profile. Click here to apply.

 

In order to generate a PAYDEX score you need a minimum of 3 accounts reporting to DUN & BRADSTREET. I will provide 3 accounts below that you can open today to generate a score. Keep in mind that this is a bit different from personal credit. It may take these vendors a bit longer to report on your business credit. Some report monthly and some quarterly.

 

Why you should build business credit without your EIN.

Building your business aside from your personal credit allows you to separate business and personal and decrease the chances of co-mingling. When using a personal guarantee, any debts owed by the business may easily be reported on your personal credit profile and affect your debt-to-income ratio and even affect you from getting financing for your own personal needs.

 

Here are 3 vendor accounts that you can apply to today to generate a PAYDEX score also knows as business credit score:

QUILL is a large vendor of business supplies, such as paper, pens, folders etc. they also have household supplies such as toilet paper, cleaning supplies and garbage bags. You may have to purchase for about $100 to get the option to have them bill you. If you do not receive the option to have your account be billed at a future time, place an order on your credit card and the next order you will see the option to have your account be billed for future.

 

ULINE is very similar to Quill, they sell similar items, you will also find packaging items on ULINE. Instead of ordering from AMAZON, you can buy from them and start building your vendor account. You may have to purchase for about $100 to get the option to have them bill you. If you do not receive the option to have your account be billed at a future time, place an order on your credit card and the next order you will see the option to have your account be billed for future.

 

NAV is not a “vendor” however they provide you access to business finance tools, such as a copy of your business credit profile and your PAYDEX score. Now the reason why I mention this is because you need to monitor your business credit profile to know when and what is reporting. NAV will allow you to monitor that and they also report to your D&B when you sign up to their $39.99 plan. Click here to sign up for NAV business plan and have 1 out of 3 account reported to your business credit.

 

Next: 5 Tools Every Entrepreneur Needs When Starting a Business.