Get the credit I need through my parents?

[Anonymous]

MyFico,

From my other post in the business credit section, I currently am facing a dilemma because I am trying to switch my corporate expenses over to credit cards in order to build corporate credit, decrease reliance on debit cards, and earn rewards.

In the last 30 days, I applied for, and was declined, for the Chase sapphire (personal use) and Chase ink (corporate card).  I have a 732 score from CreditKarma, 6 years of credit history, and no bankruptcies, liens, and negative activity on my credit report.  I also currently have both corporate and personal cards in good standing and low balances (all PIF every month). I was declined by Chase because 1) "too many credit inquiries" and 2) "not enough credit card usage history"

Since it looks like I will not get the cards I want now by myself, and I want to start enjoying the benefits of these cards immediately, I was wondering if there is a way my parents can help out.

My parents have volunteered to help me get the business credit I want, and both have excellent credit with (very long) credit histories.  I am wondering if I can make my mom an officer of my corporation (Vice President?) and have her apply for the credit cards using my corporation's EIN, with her personal credit collateralizing the card.  Then, once she is approved for the card, she calls Chase and has her add me as an "authorized user" on the account and grant me my own card.

Also, was wondering too if this would work on the personal card for Chase Sapphire - have her apply, get approved, then add me as a user on the account.

It seems that in this way, A) I can easily get the cards I want through mom's help and B) start earning the rewards now rather than later and C) be able to switch my personal and business spending onto the cards sooner than later so I can more aggressively build credit for the corporation and myself

What do you think?  Do you think this can work as intended?

-AB

[Anonymous]

PS - the reason why I am trying to apply for new cards now is that my current corporate and personal cards do not have decent rewards and also are incompatible with my Quickbooks accounting software as far as bookkeeping.

[llecs]

As you know, whenever you get a biz card with a Visa/MC/Amex logo you'll need to PG it at app time. Business finances are just a part of it; you'd have to personally back it up.

IMO, I wouldn't ask anyone to help. Chase isn't all that and a ball of wax. IMO, never pursue a card just for the rewards. If you did do this, then know that your only benefit would be for added biz credit history and the rewards. This would have no benefit on your personal credit since it won't report on there unless you default. It'll only report to DnB, Experian biz and EQ biz reports, if it were to report. Being added as an AU won't help you personally at all.

If you really wanted the card, then I'd go to a Chase branch and talk to them. Even if you get denied, they'll take the time of day to go over everything with you and give you hints and suggestions on getting the card. While I don't study Chase, I bet they are open to recons too, but I'd talk to the branch first. It may even be helpful to pull at least all 3 CRs (or whatever they pulled) and bring your latest DnB report too.

[Anonymous]

Thanks for the feedback, I appreciate it.

Yes, I am in Hawaii but will be traveling to NYC this week for business.  While there, I was going to drop in and open a personal checking account since I need to get one outside of the state anyway.  At the NYC branch, I will try to ask them for help regarding the declined Sapphire and Ink cards.

Who knows, maybe bringing them some chocolate covered macademia nuts from home will sweeten up the Chase underwriters.

-AB

[Anonymous]

AgonyBooth, I agree with llecs...I would not ask anyone for help on this.

PG'ing anything removes one of the key benefits provided by your incorporated status.  I know it's a necessary evil these days, I have some accounts that are PG'd.  I know I'm not insulated from liability for payment of these accounts should things go south, and that my personal money is at risk.  So if a bank is denying my business a credit product, I wouldn't go looking for outside assistance in obtaining that credit, at least not right off the bat; the first thing I'd do is to reevaluate my business, and its P&L statements, and determine its ability to at least sustain itself, realistically.

There are many avenues for obtaining business credit if your business is profitable and sustainable.  But it sounds as if you are just looking for a credit card with rewards.  In that event, a personal card that you can use solely for business expenses (and with cc payments reimbursed to you by your company) can work just as well for you without dragging anyone else into liability for a business credit card.

Don't forget that business credit cards are not afforded any of the so-called "protections" of the new credit card laws, either.  Rates can be jacked up at the will of the issuer, which is important to know if you ever decide to carry a balance.   I believe you will also miss out on some of the purchase protections that are normally found in consumer credit cards, too (subject to correction from other members).

I would suggest, though, that you follow some of the Business Credit 101 suggestions (in the very first post, by Tuscani).    If you take the time and make the effort to do some of these things, establish a few net 30 accts, etc., you will be receiving pre-approved offers for biz cards in your company name fairly quickly.  They'll still have to be PG'd, but they will build business credit for your company (and no family members will be at risk financially).

Good luck with everything, please let us know how you make out!

[Creditaddict]

what about Amex Charge cards. your scores should be enough and the rewards are great.

I have also tried to apply and was declined for the Ink product 2, I don't believe Chase really wants to back this product as much as they pretend they are.

if you are spending over 5k a month the amex plum would give you 2% back with early pay, don't know any better than that

[Anonymous]

Thanks for all of the replies.

@ Creditaddict: I tried applying for the AMEX Blue for Business since I already have a TrueEarnings card with them, and got declined due to insufficient relationship with AMEX, not enough credit history and too many inquiries.  When I tried to go for the recon, the rep said the main harmful thing from Experian were the multiple hard inquiries, and she recommended to wait 30 days then reapply.  I was approved for an AMEX Zync, but that's for my personal use and not for the business.

I'm paranoid about having an AMEX Green/Gold/Plat as I've read horror stories here about sudden declines and the "not so" preset spending limits.  Also AMEX advised me that I would also get declined when applying for AMEX Charge cards if I got declined for their basic credit card.

So for now, it looks like I'm stuck using my AMEX Costco card with a miserable CL that is insufficient for my business expenses ($3K).  AMEX advised not to request a CLI on the card as it would look like I am applying for a new card and would likely be another decline.  At least I got the Zync, which I will use to build some more personal credit in the meantime.

Curiously enough AMEX said to try again in 30 days.  If I have multiple inquiries this month from Chase and Macys, is waiting 30 days going to have AMEX not freak out about the inquiries?  Seems a little soon to re-apply for a new PG Business credit/charge card.....

Lastly, I read the Business Credit 101 section.  My company has no Experian business credit history nor Paydex/DNB #.  My business has no lines of credit with the vendors and companies listed in the 101 section.  My company is a service based investment advising company and most of the overhead comes in the form of licensing fees, office supplies (purchased usually from Amazon.com using the company credit card), rent, and advertising (restaurants and seminars, paid with the AMEX Costco card).  I am wondering how to build business credit without the Experian reports and/or DNB #....AMEX said that my AMEX Costco card is reporting usage for both my company AND me personally via my personal guarantee.  I am wondering if just using my AMEX Costco card continuously while PIF is actually the easiest route for my corporation to build its own credit (while boosting mine)?  I don't care that I'm personally liable for the company debt as my company has NO debt - just recurring expenses that are cancellable and quite low.

-AB

[Creditaddict]

thats simply not true that if you get declined for the regular credit cards, you will get declined for charge cards... if anything the fact that you got the zync, would tell me you would probably get a business charge. and yes you have to be careful in the beginning of your "no preset" limit but lately amex has been actually establishing limits so you know where you stand and with the charge cards the credit lines grow each month usually.  I would wait the 30 days and then apply for the gold business. and as far as your cli on true earnings, if you account is over 6 months old, it's a soft pull and you can request 3x your current cl.

[Anonymous]

Creditaddict,

Nice!  So do you think it would be safe to apply for a CLI increase on the TrueBusiness card (it is 9 months old now with perfect history) even after AMEX declined me last week for the AMEX Blue?  

Also - I am very surprised and a bit interested at your charge card comment, since I was shocked as well that I got approved for AMEX Zync (Personal) the same day I got declined for AMEX Blue for Business.  What is your thoughts on their underwriting for Charge cards vs. Credit cards?  

And how the charge cards can build personal/business credit?  AMEX said that the Zync charge card reports to all 3 credit bureaus and that responsible, constant use/PIF on the card will boost my personal credit and build it even higher.....

[Creditaddict]

I would wait at least 3 months from getting the zync to apply for the gold.

but yes i would apply for your cli now, 9k  online

amex charge cards are much easier to get than the credit cards because they can have more control over your spending and expect you to pay in full