if you have terrible credit and you're wanting to get into real estate
investing stick around in this video I'm going to show you how to get around that
hey what's up everybody this is Sam Kwak one of the Kwak Brothers real estate
investor and in this video I'm going to show you guys how to get around having
terrible credit by building business credit for real estate investing now
before we do be sure to hit the subscribe button as well as hit the bow
icon so that you get notified in our future video releases now if you have
terrible personal credit and you're wanting to get into real estate
investing there is a way around it other than just owner financing there is a
concept called business credit which is entirely separate from your personal
credit and a lot of people don't know about business credit because it's not
mainstream yet it is fairly new and there's not a whole lot of conversation
that takes place about business credit so in this video I'm gonna show you guys
how to establish business credit the most fast way possible so that you can
start getting business credit cards business loans without even using
personal guarantee now what's really nice about business credit like I said
is it's separate from your personal credit so what you do on your business
credit side won't affect you on the personal credit side whatever you do on
the personal credit side doesn't necessarily affect your business credit
side so you can keep those two credit profile differently and I'm gonna show
you guys how to do that now when it comes to your personal credit you got
five big factors that affects your personal credit score specifically your
FICO score the first one being your payment history are you paying on time
your utilization how much of your credit are you using new credit credit mix as
well as your overall age of your credit so those are the big five factors that
drive your personal credit now when it comes to business credit the main big
factor is are you paying on time okay so a lot of people think well I don't want
to max out my business credit card it's gonna hurt my business card well not
necessarily what will hurt your business credit is not paying on time and late on
your payments so what's separate what's different with your business credit is
you don't have necessarily those big five what really matters in your
business credit side is are you paying on time
now of course to take advantage of getting a business credit is that you
have to have a legitimate business you can't just you know have a fake business
and build a fake business credit you know it doesn't work that way so you
gotta have a real business whether you have a landscaping business a internet
marketing business roasted investment business it has to be a business that
you actually have and you're actually running and you're actually making money
from it the next thing you're gonna have to have when building a business credit
is have a business website a business phone number and an optional of fast
number now when it comes to your business website it has to reflect
exactly what you do so if you own a landscaping business you got obviously
this website has to be about landscaping if you own an internet marketing
business you have to highlight the fact that you do have an internet marketing
business on your website now as far as your phone number you can have a
separate phone number such as a Google Voice number or a sideline number or if
you have a legitimate office number make sure you have a separate phone number
that is not your personal cell phone number now this is an optional and it
does help is having a fax number and this is optional but it does help and it
gives you an extra credibility point knowing that you actually have a
legitimate fast number for your business now quick note on the phone number is
that you do have to register the phone number with four one one so once you
establish your business phone and phone line that is separate from your personal
phone line be sure you go to four one one and register your phone number and
your company name so that it'll be on the public directory so you got your
phone number your website and your FAFSA Murr established the next step to do is
get a Duns number at dun and bradstreet number Donna Bradstreet is a company
it's an organization that reports your business credit to the other creditors
it's very similar to Equifax Experian and TransUnion except dun and Bradstreet
specifically focuses on business so you need to get a Duns number which is kind
of like a social security number that's unique to your business and getting this
number is absolutely free although you could be misled to pay for an expedited
service or other third-party services that you need to pay for you do not need
to pay for it done Duns numbers are free you can get it for free it takes about
two to three weeks to establish and get a number deliver to you by email so make
sure you get the number not skip this step it's very important
that you have a Duns number before we move to the next step
so once you have a Duns number your EIN your website phone over all established
and ready to go the next thing you're gonna want to do is start establishing
the net 30 accounts now net 30 is simply a concept where you purchase something
and you pay back for that purchase within 30 days so let's say you went and
bought a bunch of paper from a company and if they give you a net 30 account
you have 30 days to pay for those papers otherwise you'll be late and of course
you're gonna go and attempt to collect from yes so what you're gonna want to do
is start establishing these accounts and you want at least three to five of these
accounts being reported on your dun & bradstreet credit report and you want to
have at least three months of reporting to see a paid X score of 80 so we'll pay
that score is your business credit score and it is specific to dun & bradstreet
so you want to have at least 80 in your paid X score and to establish that you
gotta have at least three months of payment history with your three to five
net 30 accounts now with the net 30 count so you can get those through
different companies such as Uline quill there are other companies that will
offer in that 30 now when you go and shop around for these net 30 counts and
when you go in and research creditors be sure you call them ask him hey do you
report your net 30 accounts and payment to dun & bradstreet now if they don't
report there's no point of establish that net 30 account so work with a
merchant /a a store or retail store that does report your net 30 into dun &
bradstreet so that you guys will get that pay that score up and going now
once you have your paid a score of 80 or higher you can start going after the
bigger fish in terms of merchants and vendors and creditors so you can start
going after gas cards certain retail stores certain national chain that you
can go after to get store specific cards so what I did is I wouldn't establish
three to five net 30 counts and then what I remember is I went and got a
credit card from different gas stations that are local to me and they do report
to you know different credit bureaus
especially dun & bradstreet and then after I started establishing credit with
the gas cards and gas store gas station specific cards then I started getting
store specific cards from Staples Lowe's places like Office Depot office max and
once I have those established again there's there's a pattern to this you're
gonna want them reporting for at least three months okay and then you're gonna
escalate to the more the bigger and mainstream change such as Best Buy
Walmart some of the more bigger chains that you can tackle on all the way to
the point if you continue this trend and established business credit you know one
foot on top of the other you're gonna find yourself to be able to qualify for
bigger business credit cards with you know banks you're gonna be able to get
business not a credit even auto loans that don't require personal guarantee
from you so once you have your business credit established this way you can
start tackling and bigger credit cards pickle alone higher living credit cards
this is the benefit this is the power of establishing business credit a lot of
times if you do it the right way you can get away establishing business credit
and accounts without your personal guarantee or without using your personal
credit now I'm gonna give you guys a brief list of what not to do when
building business credit the first thing is do not rush the process don't go off
and skip steps don't go after the big credit card companies right off the bat
follow those steps right get your net 30 accounts have it established have your
paid F score of 80 in an Escalade you know step by step don't go and skip all
the way to the end because once you messed it up there's no read to you
there's no restart there's no quote-unquote respawn back to step 1 you
can't fix your mistake so be sure to follow the steps don't rush the process
because once you do there's no do-over so be sure to follow steps now the
another thing you should not be doing is buying shelf corporation which I believe
to be is legal and fraudulent you should not be doing it now what shelf
corporations are it's basically people getting corporations and doing nothing
with it waiting couple years into the corporation ages and then start building
business on top of it or selling it to another
individual for them to build business credit now obviously this is fraudulent
this is legal and the reason why people do this is to show that the company
their business the corporation has been around for a longer period of time and
really you know it hasn't been it's not been active it's been dormant it hasn't
been doing anything obviously this will be lying to the creditors as well as the
banks and lenders so you should not be doing this you should be starting your
business credit organically the right way a legal way ethically and you don't
want it again don't rush the process don't try to take shortcuts this is not
the best way to do it so don't go off and buy a shelf corporation I think it's
terrible and I think it's straight-up illegal so you should not be doing it
now along the process if you sense anything that's shady or if you get any
other advice that tells you hey you should be doing this and in your gut
feeling it feels weird it's not ethical it's not you know it doesn't sound legal
then chances are it's not now of course you do want to do your research and you
want to make sure you understand the law and the process but if it sounds shady
to you and if you're feeling you're taking shortcut the wrong way or an
unethical way then don't do it take the pause that you need and
research what's going on before you make the decision to move forward or to not
move forward so don't rush a process don't buy shelf corporations if it
sounds shady chances are it is so to give you a recap and a summary of how to
build your business credit the first step is get your EIN your employer
identification number next establish your separate business phone line your
website as well as an optional fast number get your Duns number establish
wait two to three weeks to get your free Duns number get your net 30 accounts
established for three months of payment history and start escalating into bigger
retail stores and creditors to the point where you can now attack all the biggest
fish you know different bank cards auto loans high limit line of credit those
things are definitely possible through building business credit so if you found
this video to be valuable be sure to hit the subscribe button as well as hit the
bell icon to get notified in our future videos and the next video that you guys
must must watch is how to buy your first rental property without using your own
money or credit that videos right here you click on that video watch that video
and I'll see you guys in the next video