Building Business Credit

nrealestatenrealestate Posts: 1subscriber
edited June 2006 in Startup Funding
I recently ordered a kit by Ray Reynolds teaching you how to build business credit.  It says that I should do this using credit that I build by forming a corporation.  I understand the steps that I need to take as far as building the credit. I do not understand how shares work.  I want to start buying and selling real estate but my credit is  not strong enough to do this.  Is there anyone that has just incorporated and understands how shares work?  I feel so silly for not understanding this by doing my own research, although, I would be very open to hearing any ideas or information that anyone would be willing to share with me.  I can also give any information about what I have learned also.
 
Natasha F.

Comments

  • tomasztomasz Posts: 14subscriber
    When a business is incorporated, the new corporation issues shares to its shareholders. Now shares are divided based on the paid-in capital by each individual, who buys shares or funds a new startup(the funds that each investor like you and your partners  provide towards the funds of the business). In return you as the shareholder own shares (or parts of the corporation). Let`s say you and  and few others invest $100,000 in total. You alone invest 60% of the $100,000 at $1 par value ( an accounting term) common stock. Thus, you own 60% of the total shares and have more than half. So, you have more than other shareholders. However, you might only have common stock, which is a stock with less privileges ( like voting rights and dividend distributions) as opposed to prefered stock , which has more privileges than common stock.Hope this helps. If you have more questions, please ask.
  • nrealestatenrealestate Posts: 1subscriber
    Thank you very much for answering my question.  That is exactly what I needed. I have read so much on shares but I just needed to hear what you said from a person just like you.
     
    Thanks Again,
    Natasha F
  • nrealestatenrealestate Posts: 1subscriber
    Chris,
    Thank you for taking the time to answer my question and giving me an insight showing me how to go about doing what it is that I am getting ready to do. That is the idea that I had, I just wanted to know if I should do it using my credit or by building corporate credit to do it. I was aware of the fact that I could use the first home as collateral to purchase the 2nd home. 
    Thanks Again
    Natasha F
  • NuevolutionNuevolution Posts: 30subscriber Bronze Level Member
    I went to a RR seminar too.I think the only thing that I wasn`t convinced by was the Incorporating in Nevada while my business is being ran and established in CA. The reason why he is making you incorporate is because he doesn`t want you to use your personal information to establish your business credit. Remember in the seminar when he said it takes 5 years to get your life together and establish good credit, but it only takes six months to mess it all up? Now if you are under a corporation, you would use your federal tax id to establish your credit. In other words you would be protecting your own. If this is an on going business that you currently have, you should already have vendors that trust you and give you credit. What you need to do is establish a  Business Credit file for $269.00 with D&B Dunns & Bradstreet and have them report it there are other other businesses like staples and office depot that can help you establish good Business Credit. Just remember on the part where it says "now tell us about yourself" dont use your Social Security leave it empty.And they should set your account as a business account.. SO how is the RR Kit helping you out?
  • nrealestatenrealestate Posts: 1subscriber
    I like the kit. It is very informative. I called in to the Mark Levin show in Los Angeles, CA the other night and I asked him about it.  Just like you thought, Mike was leery about having a business incorporated in another state and doing business in another. He told me that I should not do that because when the IRS gets wind of it, they will stick me and RR will not be there to help me.  I do like the other information that he gives and I love the inspiration that comes with it.
    Thanks for the reply!
     
  • XIOSKFOUNDERXIOSKFOUNDER Posts: 1subscriber
    Great post.XIOSKFOUNDER2007-1-2 14:55:43
  • nrealestatenrealestate Posts: 1subscriber
    Now this is very good information that gets to the point! Thank you so much.  I appreciate the responses from everyone, if there is anything that you need help with, please feel free to send me a message.
    N. Fuller
  • RichRich Las Vegas, NVPosts: 636administrator Site Admin
    I found a great reference for building business credit and improving paydex score in step-by-step manner. I followed the procedure line by line and qualified for a no documentation loan of $45K in about 5 months. Its a little bit of work, but worth it.
    xioskfinder,
    i see you say you "found" a great reference online - but the website you refer people to is the same one that`s listed in your profile as your blog. are you referring people to your website or is this link you`re recommending sending people to a third party site. i`d just like for it to be clear to the person inquiring here about building credit.
    thanks!
  • XIOSKFOUNDERXIOSKFOUNDER Posts: 1subscriber
    Rich,Sorry If I came off as misleading. It is in fact an article on my blog. I originally found the information on a website that is now dead. So I pulled it out of the Google graveyard and published it on my site.To clarify, I am referring people to my website, about an article that was originially on a third party website but is no longer accessible.
  • RojgieanRojgiean Posts: 0subscriber
    That`s a decent system for "creating credit"  ... I`ve foun d a series of good sources for information on this sort of thing... one of the best I`ve found is actually within the Rich Dad, Poor Dad series.  It helps explain that even though you form the company, it will take time to get real credit, and that most other systemst that say otherwise are simply misleading the next generation of entrepreneurs!
    I hope that entrepreneurs as a whole can understand that there is no "Quick" way to create credit... only temporary solutions to help us lauch into our dreams!
  • jwmoore78jwmoore78 Posts: 1subscriber
    There are many different companies out there that will assist you with building your business credit. I would just type into google, strong business credit, and see what companies come up.
  • InitialUnderwritingInitialUnderwriting Posts: 0subscriber
    D&B is very tough to deal with.  Here at IUG we deal with them all the time, and the reality of the situation is that they will wait a long time to take reporting.  Initial Underwriting Group deals with people that have to post information on their DNB Report, and the problem is that the information does not go on the report that easy.
     
     
    Building business credit is tough, and long.
     
     
    Sincerely,
     
     
    Ilya Bodner
    Small Business Owner
    Initial Underwriting Group
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