If you become a small business owner in Arizona, you should establish a credit history for your business. A business credit history works like your personal credit history. It allows you to build creditworthiness for your business. This, in time, gives you more flexibility as an Arizona business owner to take out loans and lines of credit. There are several steps involved in establishing business credit. These include acquiring contact information for the business and getting a federal Employer Identification Number (EIN). In addition, at some point, most business owners in Arizona apply for business credit cards. These cards work like “regular” credit cards, but they are used exclusively for business expenses. Yet, as the business owner, you are responsible for all charges made to these cards.
How Arizona Business Owners Should Responsibly Manage Business Credit Cards
If managed responsibly, business credit cards help Arizona businesses build credit over time. However, for approval, credit card companies require personal guarantees from business owners. Therefore, if you sign for the card, you are responsible for all debt associated with the account. For example, if the worst happens, and the business closes, you must cover any outstanding balances on business credit cards.
In addition, business owners in Arizona who open business credit cards should know that all account activity affects their personal credit scores. Because of this, these owners must make sure that all credit card bills are paid on time. They should also keep an eye on utilization. Credit experts advise Arizona consumers with personal credit cards to use no more than 30% of their available credit at a time. Otherwise, their credit scores can drop. The same rule applies to a business credit card, and the balance on this type of card affects the owner’s personal utilization ratio and credit score.
Unfortunately, opening a new business in Arizona or any other state comes with risks. You always plan and hope for the best, but there is no guarantee that any new business will succeed. Therefore, in the beginning, business owners should play it safe, especially when it comes to credit. After opening a business line of credit, only charge what you know you can pay back. This way, if the business venture doesn’t work out, you’re less likely to find yourself with a mountain of debt and a ruined credit score.
Why Arizona Business Owners with Business Credit Cards Should Regularly Check their Credit Reports
Having and using a business credit card will strengthen your company’s credit history, but it will also add more activity to your own credit reports. This is potentially a good thing for Arizona business owners, especially if they manage business credit accounts responsibly. Yet, this increased activity also makes them more vulnerable to identity theft and credit score damage caused by credit report errors.
If an identity thief steals your personal data and uses it to make fraudulent transactions or create bogus accounts in your name, these items appear on one, two, or all three of your credit reports. The same is true if creditors and the three major credit bureaus mishandle your information and make mistakes. These mistakes show up as inaccuracies on your credit reports.
In order to catch credit report damage caused by identity theft or errors, you should check all three of your credit reports at least once every 12 months. This is how frequently the Fair and Accurate Credit Transaction Act (FACTA) entitles Arizona consumers to request free copies of their credit reports from TransUnion, Equifax, and Experian. Just go to www.annualcreditreport.com to gain access to all three.
Then, while looking through your credit reports, if you spot signs of identity theft, file a police report immediately. You will need a copy of this police report during the credit report recovery process. Next, contact Credit Repair Lawyers of America in Arizona. On the other hand, if you find credit score damaging errors on your credit reports, call our firm right away.
Our team of credit pros will help you through your credit issues. Then, an experienced credit attorney will do whatever it takes to get fraudulent items or inaccuracies removed from your credit reports for FREE.
How to Get Better Credit Legally and for Free in Arizona
Don’t let identity theft damage or errors on your credit reports bring your credit score down. At Credit Repair Lawyers of America, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? All of our fees come from the defendants in settled cases. This is why our clients pay nothing for the work we do.
Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (480) 771-6001 or contact us on our contact page.
For more information about Free Credit Repair, please visit https://creditrepairlawyersam.com/arizona/credit-repair/. Or, to learn more about Free Credit Repair After Identity Theft, check out https://creditrepairlawyersam.com/arizona/fix-identity-theft/.
