2.
Re: Raising Coroporate Debt that is not tied to personal finance Feb 12, 2008 9:54 PM
While it's possible to establish credit in the name of a new corporation, what isn't possible is trying to get credit for a new corporation without some sort of personal guarantee. It's a common misconception with budding entrepeneurs that getting credit in the name of their corportion avoids any personal liability for the debt. Corporations that get debt in the name of the corporation only without a personal guarantee from the owners have been in business a long time and have an established credit record.
The first thing you need to focus on is obtaining trade credit in the name of your corporation. This is getting vendors to extend credit to you. Some may want a personal guarantee but it's how you get started. The easiest ones to get are large corporations that sell to small business - Office Depot, Staples, and others. You get a credit account and make sure you pay it on time.
You don't need a D&B account to establish credit in the beginning. However, the larger the amounts become the more necessary a D&B credit rating becomes.
Each subsequent vendor who gets a credit application from you will look at your trade credit references and contact them. That's why it's wise to have a few vendors that you always pay on time so you can use them as references in building your credit record.
I hope this helps.
