Business Credit Cards for New Businesses

Your personal credit standing is always going to be far more important than your business credit standing, even when you apply for a card branded for business use because credit card companies hold business credit card users personally liable for any debt they incur. It is therefore important to maintain a responsible use by paying your debt on time and staying under your credit limit, as this will improve both your personal and business credit scores.

As for your second question, you can open a personal account in your name and use it for business purposes. Personal credit cards are particularly well suited for financing, as they are covered by the CARD Act and thus benefit from its protection against arbitrary interest rate increases on existing balances. With most business credit cards on the other hand, issuers do not have to wait for an account to become 60 days delinquent before increasing the cost of existing balances held on it. That in turn fosters debt instability, which is problematic when you consider that you’ll be held personally liable even for business credit card debt.

With that being said, we still recommend business-branded credit cards for everyday company purchases given their business-specific rewards and accounting features, not to mention the freedom they give you to customize spending limits for employees and then benefit from their spending. You can compare our favorite offers here. Hope this helps.

There are several easy approval business credit cards. That’s because the easiest business credit cards to get only require fair or bad credit. They include Capital One Spark Classic for Business,  the Staples Business Credit Card, and the Wells Fargo Business Secured Credit Card. It’s also worth noting that while you must have a business to get one of these cards, your personal credit history matters a lot more than your company’s.

Here are your options for easy approval business credit cards:

• Limited Credit: Capital One Spark Classic for Business
  You’ll get 1% cash back on all purchases. There’s no annual fee, and the purchase APR is 24.24%.
• Fair Credit: Staples Business Credit Card
  You’ll save $50 on a purchase of $150 or more made within 45 days of opening your account. You’ll also get 5% back in Staples credit for each purchase. There’s no annual fee. Your APR will be somewhere between 14.99% and 23.99%, depending on credit worthiness.
  
• Bad Credit: Wells Fargo Business Secured Credit Card
  You’ll get 1.5% cash back on purchases. The annual fee is $25. The minimum security deposit is $500. And the APR is 16.40%. The BBVA Compass Business Secured Card is another good option.
  
• Personal Option: Discover it Secured Credit Card

You’ll get 2% cash back on the first $1,000 you spend at gas stations and restaurants each quarter. You’ll get 1% cash back on all other purchases. Discover matches the cash back you earn the first year. There’s no annual fee, the APR is 24.24%, and the minimum deposit is $200.

There are a few easy approval business credit cards, so you shouldn’t let limited or damaged credit prevent you from getting the card your business needs. And remember, if you pay your bills on time and keep your credit utilization ratio low, your credit should steadily improve over time.

The first thing to ask yourself is whether you need your head examined.  After you answer this question, you can now get more serious Let's start out with whether this is going to be a capital-intensive or labor intensive business.  In other words, are you going to manufacture widgets that will need substantial capital to get started or will you be a consultant where capital may not be the primary consideration but instead the source of where new clients will come from. You need a plan and the plan does not have to be perfect but what it does need is budgetary considerations, goals to be achieved adn a time frame for reaching these goals. Next, assuming you can afford it is some professional advisors. At the start of the business I think the most important advisors probably is the CPA who can help you decide whether the business should be an LLC, an S corporation or C corporation. Regardless, one of these should be selected in order to protect your private assets from claims of business creditors. Once the CPAs is in place, and don't be afraid to ask if they have experience in dealing with new business owners, your next step would be to retain a fee-only financial advisor to help put forth the future in the form of projections of cash flow and tax planning with the advisor working closely with the CPA. These services are not free but in my professional judgment and based on many years of experience without them, it may be difficult to succeed. On the assumption that you may be married, you may need the support of an understanding wife and possibly children as self-employment is not a five day week with eight hour days. Very often it begins with seven working days per week and long hours. One of the early considerations is the preparation of proposed budget and recognizing that it will never be perfect, it will serve as a guideline to measure actual performance against. Your question is incredibly broad and we could probably go on for paragraph after paragraph but hopefully this is enough to get you started. Except my best wishes and hopefully you have the financial resources or can obtain them to get into the business until profits can be generated. Good luck.

Not necessarily. Even though creditors today tend to move away from relying on personal credit alone when judging the financial health of a business, your personal credit history will still factor into your approval and credit limit when you apply for business credit.

That is because most business credit cards require the business owner to personally guarantee the debt, so if the balance isn’t paid off the owner will be liable.

This also means that the business account activity may show up on the owner’s personal credit reports. Depending on each card issuer’s policy, it may show up only if the owner defaults, or all activity may be reported.

You can learn more from WalletHub’s latest Business Credit Card Study.

A good option to consider for a new LLC looking for credit is the Capital One Spark Classic for Business, as it offers a range of business benefits such as year-end summaries, employee cards at no extra cost and experienced small business customer service.

You can learn more about these benefits from WalletHub’s most recent Business Credit Card Study as well as check your credit score for free on WalletHub.