To all PPC monsters. What kind of credit scores do you have?
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If you have a business credit card, things won't get reported to your personal credit. Your credit score is determined partially by what percentage of your revolving credit line is used up, and by how often you carry a balance past the due date (as well as history, and a ton of other factors).
For instance, when I started spending a considerable about, I had a $12k personal credit limit (same as my business partner), and I was 20, with only 2 years of credit history. Unfortunately, since I was using about 75-90% of my credit limit each month, it hurt my score. However, I would never have been able to get my limit to $12k without high usage and paying it off quickly. A year later, everything is on my business credit cards, so my personal credit score should increase as I have a very low percentage of my credit limits used each month. The usage percentage is a catch-22, really.
For instance, when I started spending a considerable about, I had a $12k personal credit limit (same as my business partner), and I was 20, with only 2 years of credit history. Unfortunately, since I was using about 75-90% of my credit limit each month, it hurt my score. However, I would never have been able to get my limit to $12k without high usage and paying it off quickly. A year later, everything is on my business credit cards, so my personal credit score should increase as I have a very low percentage of my credit limits used each month. The usage percentage is a catch-22, really.
i really want a plum card, that 2% cash back would be sweet. My business card gets 1% back. Its not alot, but adds up
For all those with shitty credit here is an easy solution. Check your credit, and anything thats negative, write a simple to the point letter to each of the credit bureaus whose report that shows up on, and tell them that the neg account is false, and to provide you with proof. The catch is this. The credit bureaus themselves dont have the proof. They have to get it from the company that reported it. Here is what happens:
1. The credit bureaus have 30 days to provide you with proof.
2. The bureaus will request the proof
3. Most times the reporting companies are swamped, and are late in sending back the proof, or are too lazy or too disorganized.
4. After 30 days, if you don't receive a confirmation with the proof, send another letter, asking the bureau to please remove the negative account since it is false and you have not received the proof that it belongs to you.
I have done that in the past, and it worked every time.
1. The credit bureaus have 30 days to provide you with proof.
2. The bureaus will request the proof
3. Most times the reporting companies are swamped, and are late in sending back the proof, or are too lazy or too disorganized.
4. After 30 days, if you don't receive a confirmation with the proof, send another letter, asking the bureau to please remove the negative account since it is false and you have not received the proof that it belongs to you.
I have done that in the past, and it worked every time.
Yeah that does work, especially for negative stuff that is really old. Normally the files are archived and half the time it takes more than 30 days for them to even reply back.
The percentage usage of your total credit limit is a catch 22. If you max out your card(s), even if you pay off your balance in full every month, it will normally still show as being 90% used up or even fully maxed out and this seriously hurts your score (unless the system happens to update a day or two after you made a full payment which is unlikely). The key here is to only use business cards for your ppc/business stuff so that doesn't negatively affect your personal credit score.
The percentage usage of your total credit limit is a catch 22. If you max out your card(s), even if you pay off your balance in full every month, it will normally still show as being 90% used up or even fully maxed out and this seriously hurts your score (unless the system happens to update a day or two after you made a full payment which is unlikely). The key here is to only use business cards for your ppc/business stuff so that doesn't negatively affect your personal credit score.
In my experience, though the usage percentage hurt my credit score, Citi was more than happy to increase my credit without showing any proof of income, due to my history of paying off high balances on time. I still can't figure out why they'd give a 20 year old with a shitty credit score the amount of credit they gave me without proof of income, but I guess history with the card company counts for something.
its only 5 percent for certain things at certain months. like hotels in jan-april or something. i doubt its 5percent on everything.
Not entirely true. having a credit card in a business name is not the same as having a business credit card. Do you have a DUNS #? If not, then you don't have a business card, and if you default, it will hit your personal credit. Call your credit card company and ask if they are reporting to Dun & Bradstreet. If not, you're not really establishing separate business credit.
By the way, the FICO score for a business is called a Paydex score.
My business does not have a DUNS #, but Citi confirmed that the business credit cards would not report to the social security number of the partner (me in this case) who opened the card. Citi's MasterCard for business only accepts one SSN and contact person to set up a business credit card (even in the case of an LLC set up as a partnership), so I needed to make my partner's card an authorized user, but not list him on the application.
When I ran a personal credit score check a few months after I had opened my business credit cards, the score explanations included no mention of my business accounts, just my personal credit cards.
That's because you haven't defaulted. Alot of credit card companies (Chase and Citi for sure), don't report regular payment history on business cards to Experian, Transunion and Equifax. However, in the case of negative payment history, they will report on whoever's SS# was used to secure the card.
That is why having a DUNS # is so important for business credit. Without it, the positive is ignored, but the negative still affects you. Once you have true business credit, even a default will not affect you - only your business.
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