| By :
Marco Carbajo
When you establish business credit history nothing looks more powerful on your business credit report than a business loan. The reason behind this is because lenders and creditors know how difficult it can be and the level of scrutiny your business undergoes in order to get a bank loan approval. While the majority banks are declining loan applications you're probably wondering how you can possibly get approved for a business loan. Well I have good news for you because there is a sure fire way to get listed with Small Business Equifax and Business Experian with a reporting bank loan even if you are Startup Company with less than perfect credit. So what is this sure fire bank loan strategy? It's called the CD secured bank loan and it provides a powerful way to get a strong business credit rating and bank rating for your business. So how does it work? Basically you are securing a loan with a certificate of deposit at the bank willing to offer this type of business loan. You make a deposit into a CD account at a bank that's SBA approved and your business loan will match 100% of the value of the CD. When you apply for these loans make sure the exact name of your company is on the application along with your Federal Tax ID#. Banks will report your payment history on this loan to Small Business Equifax and Corporate Experian. Now keep in mind not all banks offer these types of loans and the ones that do will require a minimum loan amount which is typically $5,000. When you have a bank loan that reports on your business credit files you can establish business credit scores and profiles that will enable your business to obtain the cash financing it needs. Not too long ago I covered how to build a strong business credit file by having the right blend of credit. By adding a reporting bank loan along with vendor credit lines and revolving credit you can imagine how this will look in the eyes of lenders and creditors when they view your business credit report. Adding a bank loan on your report also helps categorize your file with other businesses with bank loans as well. This will help when creditors or lenders purchase marketing lists from the business credit bureaus for sending pre solicited credit offers. This strategy works as long as your personal credit scores are in the mid 600 range. If your scores are low then you may want to consider speaking with a local banker or even use the transfer of ownership strategy. Once you secure the $5,000 or more you can always deposit the money from the loan and use it exclusively to re-pay itself. Remember your money is in a CD earning interest so it's best to keep making your loan payments for at least 12 months before paying it in full. If you pay your loan off in a couple of months you will not build enough payment history with the bank and your credit file. This strategy will help your business establish corporate credit and qualify for offers like pre approved no pg business credit cards. Be sure to select the right banking contacts that provide CD secured loans so you can add a bank loan to your business credit file today!
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