Effective Tips For Secured Business Credit Cards
Years ago, business owners with bad credit are hesitant to apply for a secured business
credit card thinking that their application wont be approved anyway. Same thing with new entrepreneurs that have not yet established their business credit. Well that was before.
Today, people with bad credit or no credit history can get approved for a secured business credit card. More and more entrepreneurs use this type of credit card to rebuild their business credit history while enjoying the financial assistance their company needs.
A Closer Look At How Secured Business Credit Cards Work
A secured business credit card requires the card holder to submit a security deposit. This security deposit or fund will be used to pay off the debt in the event that the card holder defaults payment. A credit limit is set for this type of credit card and the limit is based on the amount of cash deposited.
Your Bad Credit Is Not Revealed
As soon as your application is approved, you will immediately receive your secured business credit card and you can start using it to purchase items, supplies, machines, equipment , etc. that you need for your business.
You might worry that others, such as merchants and suppliers, would find out that you are using this type of credit card because you have bad credit. Dont fret because that information is just between you and your credit card company.
What About the Costs?
A secured business credit card comes with higher costs. It is to be expected that the interest rates and fees are considerably higher than an unsecured business credit card. But with all the advantages you can get from a secured business credit card, it should be worth the expenses.
There is a way to find a more reasonable secured business credit card in the market. All you have to do is conduct your own research and compare the rates and fees that different credit companies offer. Choose the one that offers the best deal with reasonable and lower rates.
Use Your Secured Business Cards to Rebuild Bad Credit
Here are some ways on how you can improve or rebuild your bad credit score while using your secured business credit card:
Be sure to pay your monthly bills on time. Avoid submitting late payment. Missed or late payments have corresponding penalty fees aside from the fact that it will leave negative remarks on your credit history.
Stick with your credit limit. Never make purchases you know you cant pay for.
Use your business credit card for business expenses only. Never be tempted to use it to pay for your personal expenses.
Let us say you have proven that you are a responsible payer for a year or so. You can request for an upgrade to an unsecured business credit card. Remember that the credit card company you have chosen should report to the business credit bureaus on time so you can be sure that your credit history is always updated accurately.
by: Pamela Williams
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