Top Reasons to get a Business Credit Card

February 16, 2008 · Filed Under Credit Card bonuses, Noteworthy 

I spoke to many people about credit cards. They don’t feel comfortable about applying for a business credit card. I tell them over and over again, whether you have a home-based business or that you have sold something on Ebay, you can apply for a business credit card. You can put your name as the business name and your social security number as the tax id. Your business is called sole proprietorship and it’s perfectly legal with the IRS. The absolute answer is: Yes, it’s a good idea to get a business card!

Top reasons to get a business credit card

  1. When you charge on your business credit card, the amount is hidden from your personal credit report. For that very reason, your credit utilization is lower hence you credit score stay higher.
  2. Business cards have the best 0% APR on purchases or balance transfer.
  3. For the most part, you are most likely to get a higher credit limit when applying for a business credit card. Make sure to request a high credit line on your application. Household income will dictate how much you get on your credit line for a regular card. With a Business credit card, issuers are willing to increase your credit need for your business startup.
  4. If you have reached the maximum credit exposure across the board with most issuers, now is the time to call them and ask moving your personal lines over to the business side to hide some of this available credit. After your credit profile is updated, then apply for more credit cards.
  5. Your punctual in payments is worth more when it comes to Business credit ranking and less on utilization. They see spending as investment leverage in order to grow your business.

I will review in details on how you can apply for new business credit cards.

When you click on a Business credit card like the American Express SimplyCash, enter your information like you normally would with name, DOB, Social Security, and so on. Fill out home address.

  1. They will ask you to fill out the business address, so simply check the box “My Home Address is the same as my Business Address”
  2. Put your full name as your legal business name
  3. Home phone is the same as business phone
  4. Pick an industry..any will do..Normally I pick retail since I claim Ebaying as my business.
  5. Years in operation: 1-2 years
  6. Federal Tax ID: LEAVE THIS BLANK They will assume leaving blank as sole proprietorship
  7. Annual Business Revenue: $1 – 25000
  8. Put down your name as your business name for the card.

I highly recommend the American Express SimplyCash, since you get 5% cash back on gas, office supplies, and wireless services. Then 1% cash back on everything else.

The above steps are perfectly legal. As long as you have sold anything on Ebay or Amazon, mowed someone’s lawn, painted a house, or washed a car and got paid for it, then you are a sole proprietorship. You do not need to file any paper to be a sole proprietorship. For tax purposes, your Social Security Number is your TIN.

One thing I would recommend is Do not lie on your application. If your business makes $0 so far, then put down $0. Many startup businesses start with $0 revenue. Don’t put your day job workplace as your business. That would be fraud unless you own the business.

The cards below are my recommended list of business credit cards.

Balance Transfer Fee is Cap

  1. Advanta BusinessCard Rewards – 15 months 0% APR on BT. $50 cap on BT fee.
  2. Advanta Platinum BusinessCard – 15 months 0% APR on BT. $50 cap on BT fee.
  3. Discover Business Miles – 12 months 0% APR on BT. $75 cap on BT fee.

Great Cashback Business Credit Cards:

  1. American Express SimplyCash: 5% cashback on gas, wireless services, and office supplies
  2. American Express Blue Cash : 5% cashback on everyday purchases
  3. Chase Business Rebate Card: 3% cashback on restaurants, office supply stores, gas stores, and more.

Great Bonus Points/Miles/Cash Business Credit Cards:

  1. AmEx Platinum Business FreedomPass: 5000 points = $50 gift card after first purchase.
  2. AmEx Starwood Business: 10K Starwood points. No fee first year.
  3. AmEx Business Gold Rewards: 5000 points = $50 gift card. No fee first year.
  4. AmEx Gold Delta SkyMiles Business: 15K Skymiles after first purchase. No fee first year.
  5. AmEx JetBlue Business: 50 True Blue points = 1/2 free flight. $40 annual fee

Here are the many ways you can get money from the 0% APR Balance Transfer offers from above:

  1. Advanta: Request direct deposit to your checking account.
  2. Chase: They will send BT check or request the BT check with card, make check to yourself, and then deposit into personal checking account.
  3. Citi: Call and request BT check payable to yourself, and then deposit into your checking account.
  4. Discover: Call and request BT checks, write check to yourself, and then deposit into your checking account.

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Comments

14 Responses to “Top Reasons to get a Business Credit Card”

  1. SingleGuyMoney on November 19th, 2007 6:07 am

    I have the Amex Simply Cash Card and I love it. The cash back amount is automatically credited to my account each month.

  2. rocketc on November 19th, 2007 8:34 am

    I have made almost $2000 from credit cards this year – including bonuses, cash back and interest free loans. . .

  3. Mike on November 21st, 2007 2:31 am

    Hustler,

    Grea Info. Will there be a hardpull on your SSN?

    Thx.

  4. American Express Holiday Promotions and Offers » Hustler $$$ Blog on November 26th, 2007 12:18 am

    [...] Top Posts Business Cards Bonuses No BT Fee Bank Bonuses List PF’s Class of 2007 Cash Back Credit Cards Miles-O-Rama [...]

  5.   Great Promotions from American Express by My Credit Cards Blog on November 27th, 2007 12:13 am

    [...] account to see if you qualify for double membership rewards points for spending $500 each month. I wrote extensively on why you should get a business credit [...]

  6. RacerX on December 28th, 2007 11:32 am

    Another thing to remember is that any Blogger with Adsense on there site is a business too.

    This is often a good way to get better rates, credit limits and bonuses.

    If you are going to carry a crd, carry a good one.

  7. glxpass on December 29th, 2007 9:26 am

    Citi Professional shows on your personal credit report.

  8. Nir on December 29th, 2007 12:56 pm

    Citi Professional is not a business line. They claim it’s a credit card for you business purchases, but it reports to your personal credit report, and does not ask you for business ownership info.

  9. Katie on April 18th, 2008 5:57 pm

    If it doesn’t show up on your personal credit report, where does it get reported? And why do they need your SS# then? Just curious, because it seems odd that a credit card company wouldn’t report to a credit reporting agency. Can you clarify? Thanks!

  10. Hu$tler on April 18th, 2008 7:11 pm

    The SS# is just to check if you are the person applying for the cards. The actual balances will not report on your personal credit report since it’s a business card. That is just how the credit card industry works.

  11. Katie on April 18th, 2008 7:55 pm

    Thanks for the reply…what happens if you fail to pay on time or if someone didn’t pay at all? I understand that they could still collect from you because they have your info, but a poor payment history wouldn’t appear on your credit report? It seems like, and this might just be my ignorance on the subject showing, but do they also use your SS# to determine your eligibility for the card (prior credit history)?

  12. Hu$tler on April 19th, 2008 12:22 am

    When you apply for a business card, it doesn’t mean they won’t look at your credit report. They look at your credit report, household income, and credit score.

    When you do get approved for a biz card, the balance on the new biz card is not on your personal credit report.

    Those are two separate issues.

  13. Joseph on June 19th, 2008 2:57 am

    Question: I presently have $80,000 borrowed on 0% APR BT’s on personal cards (thanks to Hustler for all the tips on that!). Does the business card application look at my personal credit report? That is, should I wait until all 80K is paid back (next year) before I apply for the business cards in order to maximize the credit line that they give me? Thanks!

  14. Hu$tler on June 19th, 2008 12:52 pm

    Yes, you should wait because they look at your credit report.

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