Unlock Business Credit: A Complete Guide to Using Your EIN
Why Business Credit Matters Using Your EIN
In this article I am going to tell you why you need to establish business credit and why you should be using the new Fundability ™ software for your business going forward. I will also provide you the steps for using your EIN number and just why business credit matters so much. - Richard Bronson - CEO American Biz Credit LLC.
Many business owners unknowingly risk their personal finances by mixing personal and business credit. They start by funding a new startup or financing their existing business with a personal credit card. Why is this dangerous? Because it will drive up your personal credit utilization ration and lower your personal credit score. After a while when you need more funds, you will find that your personal credit score is now too low and you can't get credit elsewhere for your business. What's more, if your business gets into financial trouble, your now totally stuck with no way out except to come up with a personal or business asset to use as colleterial. When those funds are gone. Your done...its game over time and you close your business. The solution? Build business credit using your Employer Identification Number (EIN Number) and never use your SSN number to fund your business again. This approach offers several key advantages:
Separate personal and business finances
Protect personal assets
Get higher amounts of credit than you can on a personal level
Access larger credit trade line terms with Net 30, 60 or 90 day terms
Secure better interest rates
Establish independent business financial credibility
Step-by-Step Guide to Building Business Credit
1. Establish Your Business Entity
Choose a legal structure (LLC, corporation, or partnership)
Avoid sole proprietorships that blur financial boundaries
Use software to help manage your goals for credit, like Fundability TM
2. Obtain Your EIN
Apply free through the IRS website
Use as your business's unique financial identifier
3. Create a Solid Financial Foundation
Open a dedicated business bank account
Separate all business and personal transactions
Register with Dun & Bradstreet for business credit tracking
4. Build Credit Strategically
Work with vendors that report to business credit bureaus
Pay trade lines early or on time
Apply for business credit cards without personal guarantees
Consistently monitor your business credit reports
Risks of Using Personal Credit for Business
Personal Liability Exposure
Business financial issues can threaten personal assets
Lack of legal separation increases financial vulnerability
Credit Score Damage
Business expenses can max out personal credit cards
Negatively impacts personal credit rating
Limited Growth Potential
Personal credit constraints restrict business financing
Reduces opportunities for business expansion
Why is Fundability TM software so important to use in my business?
The Fundability TM software at American Biz Credit is the only software available today that manages your business credit, business foundational information, and builds your business credit for you in a professional and quick way. Saving you time, expense, and frustration along the way. It is tied into Dun and Bradstreet, Experian Small Business, and Equifax business reporting for analysis. It will also provide you all of the vendor credit account requirements that you need to know about before you apply for new business credit, so that you fully understand what you may still need to accomplish before you apply.
This link will provide you a demo of the software
Frequently Asked Questions
Q: How long does building business credit take? A: With consistent effort, significant progress can be achieved in 6-12 months.
Q: Can I build business credit with poor personal credit? A: Yes, an EIN provides a fresh financial start independent of personal credit history.
Q: Why are vendor relationships important? A: Vendors reporting to credit bureaus help establish and strengthen your business credit profile.
Conclusion
Building business credit with your EIN is more than a financial strategy—it's a pathway to business independence and growth. By separating personal and business finances, you protect your assets and create opportunities for future expansion.
Ready to take the next step? Visit American Biz Credit for comprehensive guidance on building your business credit.