5

I had financial issues back in 06-08 (when the nation in general also did). I had debt I couldn't pay, and I had to sell our house short.

I since then have not purchased anything I couldn't pay cash for. However, since then, I have built a business where I purchase about $400,000 a year in products. I have always just used my debit card. Clients pay, and then I buy after I have received payment.

This does nothing for building back my credit. It has been about 7 years most of the bad will be falling off.

I spend 20-50k+ a month for my business. I could be earning rewards on all that spending, and I may need a credit line for business spending in the future. All I could qualify for was a card with $2,000 available balance. I was declined by others. So with this card should I spend $2,000 today, then immediately pay online and do the same every few days, so they see how much I spend and never keep balance on card? Or just use the $2,000 once a month and pay off the bill when it comes?

  • 3
    If your financial issues ended in 2008, it's been more than seven years. As a first step, I suggest running a credit check with all the agencies in your country. – ChrisInEdmonton Jan 23 '16 at 13:08
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Set up a meeting with the bank that handles your business checking account. Go there in person and bring your business statements: profit and loss, balance sheet, and a spreadsheet showing your historical cash flow. The goal is to get your banker to understand your business and your needs and also for you to be on a first-name basis with your banker for an ongoing business relationship.

Tell them you want to establish credit and you want a credit card account with $x as the limit. Your banker might be able to help push your application through even with your credit history. Even if you can't get the limit you want, you'll be on your way and can meet again with your banker in 6 or 12 months. Once your credit is re-established you'll be able to shop around and apply for other rewards cards.

One day you might want a line of credit or a business loan. Establishing a relationship with your banker ahead of time will make that process easier if and when the time comes. Continue to meet with him or her at least annually, and bring updated financial statements each time. If nothing else, this process will help you analyze your business, so the process itself is useful even if nothing comes of it immediately.

4

A) The Credit Rating Agencies only look at the month-end totals that are on your credit card, as this is all they ever get from the issuing bank. So a higher usage frequency as described would not make any direct difference to your credit rating.

B) The issuing bank will know if you use the credit with the higher frequency, but it probably has little effect on your limit. Typically, after two to three month, they reevaluate your credit limit, and it could go up considerably if you never overdrew (and at this time, it could indirectly positively affect your credit rating). You could consider calling the issuing bank after two month and try to explain the history a bit and get them to increase the limit, but that only makes sense if your credit score has recovered. Your business paperwork could go a long way to convince someone, if you do so well now.

C) If your credit rating is still bad, you need to find out why. It should have normalized to a medium range with the bad historic issues dropped.

3

Sign up with credit karma. It will give you two scores for free and will show you credit cards you have a good chance in being approved for. Plus it will evaluate your score showing you the 6 items that effect your score and give you steps to improve them or tell you how long you have to wait until they roll off.

Plus I would look at a credit union and see if they have any "fresh start" programs. You should be well on your way.

the thing that is probably hurting your credit is your utilization. If you can just use 10% of your available credit.

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