Business Credit Cards: How to Apply

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Don’t blindly apply for numerous business credit cards in hopes of getting approved, follow these steps on how to prepare your application for a quick approval. Before applying for new credit cards, you first have to know that roughly 10% of your FICO score is literally dedicated to New Credit.

Every single time you apply for another credit card, they do a hard pull on your score, and this 10% allocation of your FICO credit score takes a hit.

Overview

When people look to extend their credit, it’s a good indicator that they’re experiencing financial troubles. The more credit cards they apply for, and get denied, the more dire those troubles are likely to be.

In Step 1, you’ll learn how to properly weigh credit card perks when building a list of your possible options, so you don’t apply for the wrong cards.

In Step 2, you learn how to qualify for the cards you chose, while in Step 3 and Step 4, you’ll review your options and start applying.

Credit Card Perks

Step 1 — Gather a list of credit cards options that interest you, and then seek out the perks of owning each specific card before applying.

0% APR

These offers are the holy grail of unsecured business loans, which can be used again and again to liquidate your credit cards and bring in much-needed investment capital.

Do also note that 0% intro APR and convenience checks offers generally come with a minimum 3-4% transfer fee, which means:

  • You would be charged 3-4% of your balance transfer amount on your next statement ($30-$40 per $1,000 transferred)
  • You would need to pay off your balance transfer BEFORE your 0% APR intro ends (within 9-15 months) or then pay full credit card interest rates on your remaining monthly balance.

High Cash Advance Limit

Generally, you won’t want to take cash advances from any credit card as they come with a transaction fee, plus a higher interest rate that starts accumulating from the day of withdrawal.

If you can find a card with a high cash advance limit, you can use it in combination with 0% APR balance transfer checks, to essentially get a cheap, interest-free loan for up to 12 months.

Low Cash Advance Fee

Again, you don’t want to take any cash advances that you can’t pay back within a few days, as the daily interest you’ll pay is ridiculous. A low cash advance fee combined with a high cash advance limit, however, can reduce the costs using our system to turn credit into cash.

Low Interest Rates

Generally, if you’re looking to build credit to the point of getting business loans and credit lines, you’ll want to pay your balances in full each month. If you need quick payday loans, however, a low-interest credit card might come in handy at some point.

Cashback Cards

If you make a lot of purchases for your business and can pay off your balance in full each month, then it won’t matter if the card has a high interest rate. Having a 1.5-2.5% cashback card means $15-$25 refunded to your account for every $1,000 you spend.

Reward Points

If you travel for business, especially in business or first class, getting a rewards points card can be very beneficial to your travel budget. If you convert miles and points to cash or products though, then you might as well, just look for a cashback card that has a complimentary rewards program.

Annual Fees

Typically you want a $0 annual fee card. If you collect reward points, cash back or travel points, or desire extras like rental car insurance, they generally have an annual fee attached to them. These fees are usually less than $100 per year. If two cards you want offer the same perks and approval requirements, take the one with the lower annual fee.

Build Credit Score

Step Two — Once you have your list of preferred credit card perks ready, the next step is to see what requirements you need to qualify for approval.  When applying for more credit, your score might drop a bit (New Credit portion of FICO score), especially if you get denied, so it’s best to have some leeway when applying for multiple cards.

To build credit quickly, be sure you have a DUNS Number and then start applying for Net 30 vendor accounts like Crown Office Supplies. By increasing your tradeline presence, and paying your invoices on time, your credit score can improve quickly.

When paying your 30-day invoices early, rather than just on time, you’ll get an even extra Paydex score boost from D&B.

Review Your Options

Step 3 — Once your credit is built up, it’s time to start looking at the terms and conditions of the credit cards you want to apply to, and to find the normal approval amount for companies similar to yours.

After comparing every aspect about the credit cards you want to apply to such as low/no APR, annual fees, variable or fix interest rates , you’ll be ready to decide which options are best for you and your business.

Start Applying

After building your own list of preferred business credit cards, and knowing what you should qualify for, you’ll be ready to start applying.

Value First

Choose the credit card that offers the most value to you first.

If you’re looking for a zero-interest cash advance loan, this card would be the one with the highest cash advance limit and lowest cash advance fee.

If you already have existing credit cards that you want to pay off, then options with 0% APR offers and matching low annual fees would be very useful.

If you use your credit card for numerous or expensive monthly purchases, then applying for a cashback card or travel points card would be in your best interests.

Complimentary Next

Once you get approved for your value first card, it’s time to seek out other business credit cards that provide complementary perks to your first.

If you received a high cash advance limit card first, then a 0% APR card would come next, since it will allow you to take out a cash advance loan.

If you choose a 0% balance transfer card first, then a cashback card should be of interest, since it will give you extra money to pay back your balance transfer debt.

Application Stacking

Stack your credit card applications in priority of your most pressing needs and also weigh your secondary needs in regards to the highest credit score needed to qualify.

Since you’ll be reducing your income-to-debt ratio with each card approval you receive, your credit score will take hits as you reach your maximum total credit limit.

If there’s a noticeable credit score difference to qualify for a specific complimentary card, then it might be beneficial to apply for the one with the highest requirements first, since you might be unable to qualify later.

Bottom Line

If you map out the credit card perks that match your immediate needs, rather than randomly applying for multiple credit cards, you can stack your applications accordingly.

Before you apply for any credit card, you should already know in advance, the chances of qualifying for approval. Application denials will hurt your credit score, as will multiple applications which have no set purpose.

When you’re ready to apply, always choose your highest value card first, then your complimentary cards next. The sweet spot will be that when combined, your credit card stack will have every perk you wish you had on a single solitary card.

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