business credit

[thedieseldoc]

After forming my LLc. I have ran into a brick wall on line of credit for small businesses under 2 yrs old.......I have been running under sole proprietorship for a year.........set-up the LLc and now cannot get even a credit card in the company name,unless I personally sign for it ...........What alternatives are available that don't penalize a start-up company.....sure I get a secured card,High interest rates,Equity line of credit............But thats not what I want...........In the last year I have been financing my business using my personal credit rating and such. All assets are held by Me ............Which I can transfer to company name. Over time I will max out my personal credit ,Some assets can't be transfered because of loans.........But the company can't get a loan because of no credit history. I don't want to keep trying and adding inquiries to my personal credit or the LLC's credit profile.Have found that most banks or credit card companies do not recognize a LLC. They look at it like the IRS does............ A glorified sole proprietorship or Partnership unless 8832 is filed.

 

[Michael Wechsler]

Look at it this way -- would you lend money to a person who has no history of income unless it was backed by someone else who has some reliability? Why should any company take a significant risk with a newborn without a person (who is doing the spending!) attached to the debt? If you think about it that way I think it makes sense and you realize that it isn't a penalty.