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Historically (about 15 years) I have had a score from 760-780 consistently. No late pays.
January 2008, my father in law retired and husband and I took over the existing business. We also expanded the business to include 24 hours towing.
The bank approved and wanted to give me $25,000 unsecured to purchase the first two vehicle because the bank in question normally didnt take commercial vehicles in as collateral. Finally after I insisted the bank agreed to put a lien on the vehicle and make the loan secured, because I had a concern about unsecured debt this high.
Then, we purchased additional property for the business, with a mortgage of $50K for property valued @ $80K.
We purchased a second tow vehicle for $13,500 with no financing and then purchased a third vehicle for $33,500 ---$11,000 downpayment and took advance of a 1.9% offer for $22,500 to purchase this vehicle. I understand how this purchase could negatively impact my score.
Here are my questions
We didnt have a Dunn & Bradstreet number at the time of these investments but we have one now. What impact if any will it have if we refinance any of the vehicles above as business debt and not personal debt?
Would financing it through the business move the debt from my personal score or does it still show up and if so, how does business debt factor into your score.
Also, one creditor reduced my credit limit----following the debt acquired above within 6 months, but corrected the matter when I called in and gave them my updated asset and income information. On the letter however, one reason was number of credit accounts. Is there some magical number that you should not have any more than x accounts for revolving credit accounts.
I don't want to pay off the third vehicle and deplete our cash supply, and I do not need any more credit to use, but should I consider call all my credit card companies and giving them my actual income amount and request credit increase so that my percentage of debt/amount of credit is not as high?
Also, if I close some of the accounts---some I havent even used in years---will that have a negative impact on my score even if closed by consumer---I vaguely recall reading somewhere that it didnt used to have a negative impact on your score but it may in the near future.
Thanks in advance for anyone who can provide me information.
Just having a Duns number doesn't give you business credit. It is a process that takes some time by aquiring Net 30 accounts and developing larger commercial lines of credit to reflect credit worthiness.
Read the sticky post at the top of this section called 'Business Credit 101'.
Unless the business you took over had established credit and you are now officers you'll have to go through the process. It is just llike building personal credit when you were young, it starts out slow with small credit lines and you work your way up.
You can shortcut it by giving a PG (personal guaratee) to business credit cards and loans but if somehing ever happens you've intertwined the two.
There are acouple of great posts on these Forums on how to build business credit, just use the search tool and you'll find them.
I see no problem at all asking for CLI for your personal cards but try took keep the number of inqiries down. Always try to get these by having the lender do a soft pull or just go on the cards history alone. Once again if you use the search function here for individual cards you can find out if other's have had lenders pull a hard inquiry while making the request. If you list the lenders it will help, some always do a hard pull like Chase and some almost always do a soft like Amex and BoA.
As far as the CLD ,it was probably triggered by all the new credit obtained recently. More than likely it's not a lender you want to deal with. Tooo many inqueries and recent accounts in a short time frame.
There is no magical number of accounts. As long as they are in good standing and not done in a recent spree it shouldn't hurt you.
I would suggest staying on these forums for a while, go to the credit card section also, that has the type of info you're looking for also as far as increases, too many accounts, credit line decreases, etc.
You have great scores, estabished history, and no lates, that's great. It really increases your chances of increases as long as your income is decent.
Welcome to the forums
Jax