1 – separate business credit from personal
2 – NO personal guarantee
3 – additional capital that doesn’t have to come out of your cash flow if it’s a slow month or season
4 – builds your business credit reports, profiles, and scores
5 – I would be buying office supplies, gas, computers, etc. anyway so why not let those purchases build my business credit?
6 – My FICO score doesn’t matter (see next list for a variation of this one)
1 – I can’t use these as working capital…a Staples card is cool but I can only use it at one store in the universe (well, lots of Staples stores but you get the idea). In my opinion this is far and away the number one downside to the Non-PG Business Credit Building process.
2 – Rates are usually much higher than you would pay on a working capital or PG line of credit so they are more “costly” (not a deal breaker but it does need to be noted)
3 – Some are Net 30 and not revolving so the cash-flow benefit can be limited if the account isn’t revolving
4 – My good FICO scores and personal credit doesn’t help me with better terms.
What did I miss? If you have anything to add to either the “pro” or “con” side let us know. At LenCred we specialize in unsecured business lines of credit that require a PG. These have great rates and will allow a client of ours to maintain their great personal credit. Our unsecured business lines can all be turned into working capital and used for whatever purpose you choose. We offer a No Obligation Pre-Qualification process that is brief and gives you the answers to all your questions. We know small business loans, unsecured business lines of credit, and we know it well.