Have you ever considered using business credit to buy properties?
Steve Wible is a Marine Corps veteran with a deep background in real estate sales. He passionately combines his high energy and business credit knowledge and is a recognized expert in the field. He’s got a concept that I haven’t talked to anybody else about, and that is how to use business credit to buy properties. If you wish to save some serious cash, you need to tune in!
More about him – creditsuite.com/pod-ein
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Welcome to today’s show. This is Tony Javier, your host of the real estate masters podcast. Today we have Steve Wibel on the line here. Steve is a veteran both in the military and in the real estate field. He’s done hundreds of hundreds of properties, and I’m really excited to talk about Steve today because – or to Steve today – because he’s got a concept that I haven’t talked to anybody else about and that is how to use business credit to buy properties. So Steve, welcome to the show. I’m excited to have you on here.
I’m excited to be here, Tony. Thanks for having me, man.
We have a lot, a lot in common here. I lived in Tampa where you live. You lived in Carlsbad, which is basically San Diego where I live. So it’s kind of interesting how we’ve, you know, swapped locations like that. And now we’re talking. So yeah, so we started talking offline about business credit, that kind of stuff. And I’m like, you know, let’s just hit record. I’ve got a ton of questions, you know. I’ve done a lot of deals and I’ve done them most of them with private lending which is basically private investors, individuals that are funding deals and then I’ve used banks and my own money and that kind of thing. But your concept is a lot different. So I guess I’ll first let you start with how you got started, kind of give us a background about you and then I’d love for you to dive into the credit and see how we can add value to those that want to figure out how to buy properties with business credit as opposed to the traditional way.
Awesome. Okay. Well to, in order to understand how I got there, you got to understand where I came from besides the Marine Corps. When I got out, my family had been in the printing industry for generations, literally generations, my grandfather, my father. So I understood that business in the manufacturing world, business credit is of utmost importance. You can’t survive without it. So like in, in the printing world, I needed millions of dollars in credit from my paper suppliers in order for me to manufacture the product, I was manufacturing and selling it to blue cross blue shield. Believe it or not AOL, I helped them launch way, way, way back in the day. So we need a business credit survive, okay. And everything from boxes to trucking, to supply whatever we needed, we needed other suppliers to give us credit.
And a good example of this is Walmart. Walmart was started in the 1940s after Sam Walton came back from world war II and he leveraged business credit to get that business going. As a matter of fact, to this day, when you walk into a Walmart, if you buy anything off their shelf, the odds are, they haven’t paid for it yet. It’s on terms from some other vendor. So they’ve reversed it instead of a big company financing, a small company, they’ve got the small companies financing, the big company, right. Which is brilliant. So again, I understood what business credit was. So when I sold that company and went to my brother’s house, sitting in his kitchen and sit down. I don’t know what to do now. I’m young, man. I’m in my late thirties, what do I do? He said, well, Hey, I own five properties that rentals we should, you should look at that. So I never even thought about it said, all right, well, let’s take a look. And we started looking through the newspaper, you are gonna love this, you’re not old enough to remember this. I don’t think.
I started in the newspaper 20 years ago when I started my business. Yeah.
Okay, good. So I’m looking at their newspaper and I see three properties for sale in Camden, New Jersey. And I grew up right outside of there. So we call the gentlemen up, set an appointment. We sold the three, they were kind of wrecks. And they were asking, I think at the time, 95,000 for all three. So 33,000, a piece 32,000 a piece I said, well, do you have any more, well, yeah, we have 36. I’ll take them all, take them all.I’ll drive around. Look at them. I’m thinking I have to get them, I don’t care if they’re wrecks or not, but I’ll pay you 11 five for each one. Well, they took it now. I had to find the money. So here’s, and there’s a reason I’m bringing this up. Had to find the money, found a hard money lender, a private lender, that was willing to fund the deal.
But I sold half of them prior to even funding for the entire purchase price. So I got in for free basically, but now I had to rehab them. And because I understood business credit, I knew that I had to begin building my business credit profile so that I can get credit from places like home Depot, without a personal guarantee from Lowe’s without a personal guarantee, getting high limit visas, MasterCards, anything that I needed for ancillary products. I knew I could do that without a personal guarantee. So I began building my business credit. I got it down so systematic that I could borrow money from you as a private lender. And we all know how hard money lenders work. They’ll loan you the money for the purchase. They want some skin in the game. They’re going to hold back a draw for construction. Let’s say it’s a hundred grand.
They are going to give you maybe five draws of 20 grand each. You’ve got to front the construction basically. And and then once it’s finished, you put it on the market. Well, I figured because I didn’t want to use my own money. I’ll do that, but I’m going to let home Depot front the construction. I’m going to let Lowe’s from the construction and I’m going to use my business credit cards to pay my vendors. My contractors. Now keep in mind, this is a hot market. You list a property, it’s gone. So when I would get my draws from the hard money company, let’s say it was 30 grand. I would take that 30 grand divided into three and go put 10 grand down, all three new properties. So I’m already got escrow on three more properties using their money. Not mine. It’s buried in that alone. Have that property sold, pay off the credit cards, pay back. The loan always have profit left over and then I’ve already got three more going. Well, I’ve made it so systematic that I, I turned over 300 properties two years. It was like an assembly line.
Right. Now the caveat to that is, you know, not overleveraging right. You need to have equity in the properties. You’re buying, not just putting down payments down on properties that are already retail, right?
That was a matter of fact, you know what? There’s something I heard from a guy a long time ago. I would go to these masterminds to try and understand the business a little better. Cause I didn’t know anything about it. I just jumped in. And what I heard from a guy who was probably in his seventies back then was you don’t make your money when you sell it, Steve, you make it when you buy it. I never forgot that. In other words, if you get in, if you get it at the wrong price, you won’t make money, make your money when you buy it. And that’s what I remember. So anyway, but the problem is this isn’t something just anybody can do. You can’t just walk into home Depot tomorrow and have to say, Hey, I want a business credit card without a personal guarantee.
They’re going to look at your business credit report and go, no, sir, please sign on the dotted line. You’re going to have to PG this because what most business owners don’t realize is they have a business credit profile. You already have one. Tony. I guarantee you, you have one. If I pull it up, if you’ve never gotten credit in the business name, it’s going to say this, this business has potential to be bankrupt in the next 12 months. That’s what it says on your business credit report. And not because you did anything wrong, but because there’s nothing reporting, right? So, so the credit reporting issues look at it as well. They obviously aren’t really in business. They’re not, they’re not getting credit from any other business. Make sense?
I know one of the credit reporting agencies. Is there more than one of them?
Yes. There’s multiple. There’s, wow. There’s three that everybody will know of. Then there’s probably another 10 secondary ones. There’s a company called Credit Safe. They’re like number four in the country. But the two that you really want to be concerned with Dun&Bradstreet, which is probably the one you heard of and then Experian, which most people don’t realize. They have a business credit report as well. Matter of fact, matter of fact, when banks look at your business, they look at the experience report. So just like you personally have an experience credit where you or your business also does someone .
Like me, that’s been in business 20 years, I’ve got 20 years of loans that I’ve paid, paid off, all that kind of stuff. How would someone like me go back and get credit for that? Would I just go to go to Experian and say, Hey, talk to my creditors that I paid on time. I, you know, kind of talk us through that because there’s a lot of people right now that are probably wondering how to get past history on their business credit. Well,
The only place you can get past history on your business credit would be a DNB and you’d have to pay DMV a lot of money, a couple of grand for them to put that. And then they’re going to contact all the lenders to verify it. It’s almost not worth doing because it’s like placing trade lines. If it’s already closed and dead. Yeah. It gives you a history, but there’s what you really want is organic reporting. And if you’ve been in business 20 years, the odds are you probably have something reporting. That’s reported. Either somebody filed a UCC filing on it. There’s something that’s showing up there. You may not know it. You have any business credit cards at all? You don’t have to tell me who they are, but so you have the, the odds are, some of them are reporting. Matter of fact, here’s how you’ll know – if you go onto your personal credit report and it’s not there, it’s reporting on your experience and your business. So I’ll give you an example of one that doesn’t do that capital one card. They say it’s a benefit.
That’s my, that’s my favorite card. They give you two times points on everything. Yeah.
But unfortunately they only report on your personal credit. They don’t report on it. But Wells Fargo, Chase, they report on your business credit report. Okay. So it just depends on which bank, not all of them reports, some of them don’t report at all. But the real secret is to get cards. Even though you’re getting lots of points back, Tony, you want to get cards that don’t report on your personal credit. Do you want to get cars that are only reporting your business credit? Because it doesn’t affect your personal credit score. We all know, right? You max out your credit card, but your score down. It goes down right now. That was important to me because I was scaling and I also had rentals, right? So I had enough rentals that, you know, I had a property management company and I wanted my maintenance team to be able to go to home Depot or Lowe’s and buy the material they needed when they needed it. So they all had credit cards that were tied to the company. I didn’t want to maximize my credit score out if we suddenly had to replace an entire kitchen, right. Or you know what? Five water heaters broke down at once. With 300, well, you had lots of doors, you know, with 300 doors, five water heaters going at once. It’s not really that unusual.
Awesome. So let me ask you this. So like I’ve got tons of bank lines. I’ve got properties all over with local banks. So what would I do? Just go to my local bank and say, Hey, you need to restart reporting to Experian and Dun&Bradstreet?
Well, they may already be. You’ll have to pull your report and do that. You can go to NAV (n, a, v) and pull your report. I think they charge – My friend you can go to us. You can go to creditsuite.com/reports and you get a free access to your report. We’ll give you all three credit reports.
Give everybody that web domain again, I’m going to write it down as well.
It’s creditsuite.com/reports. We have now integrated into our system and they charge, I think 36 a month. We charge 24 a month. They give our clients a break because we have so many of them, but the first month is free. So this gives you an opportunity to go in and look, you don’t have to buy anything. You can cancel immediately if you’d like. But it’s a good opportunity to see what’s reporting and people should check. Now, don’t be surprised if nothing shows up, one, because you have nothing reporting. But two, if you’ve changed your addresses at any time and didn’t update the credit reporting agencies, they may not know where you are. That could happen to all business creditors reported based on your address. So if your address doesn’t match somewhere, let’s say the IRS has you know, 123 main street and secretary of state has a PO box, which God forbid, we’re going to dive into that in a minute.
And your check-in account is set up at a different address cause you never updated anything cause you never really cared. That’s problematic. So you have to make sure everything is congruent and then your reports will match. And it’s easy to update. You can go to DNB and update in online. It’s really simple. My friend, if you go to dnb.com, this I would tell people to do today, go to dnb.com, David Nancy Boy .com and look up DUNS number lookup. You can type in your business name and the state you’re in. And if it pulls your information up, if you recognize yourself, you have a duns number and just, there’s a little link there. You just click email DUNS number and have it sent to you. Now, before Warren, once you do that, they’re going to blow your phone up. They’re going to try and sell you something. All right? So you don’t need it. You really don’t. Now you could do what we talked about. You could place trade lines there, but there’s no real benefit. It shows a history. But it doesn’t show active credit. And what happens is when you have active credit, they actually start recommending you for higher and higher limits.
Okay? So past history. So like having 15 to 20 years of, of previous history is not a big deal. They want to see what you have open right now. That’s active being paid?
It’s a combination, but here’s the problem. If you’re paying to have a place that’s actually a dead trade line. In other words, when the contract expires at the end of 12 months, if you DMV will call you and say, Hey, do you want us to spend that two grand again? If you say, no, they’re all dead closed trade lines there. They don’t report anymore. They are gone.
Because I had someone contact me that I did a private money loan with, I have a gap funding business and, and they were the only one that’s ever had me get in touch with, I think it was Dun&Bradstreet to give them an updated report, but they’d already paid me off. So you’re saying there wasn’t really any benefit to that?
No, if I would’ve talked to them I would’ve told them not to do it.
Okay. So maybe they were the ones, one of those that got sold on, Hey, you need to pay us money to report on it. Yeah, yeah. I think I’ve actually even gotten recorded voicemails dropped in my my voicemail saying something about my credit is not being reported on Dun&Bradstreet. So they do, they sell stuff like that to you, right?
Yeah. So what happens is they look for, I’ll call it borrower A, to pay them. And then borrower A has to give them your company’s information so they can get in contact with you and get the information. What they’ve effectively done is built a sales list, borrower A gave them your contact info. Now they’re going to solicit you to pay them. It’s, it’s almost like multi-level marketing, right? So they hate us because we teach everybody the real deal. If you have somebody like, I’ll give you an example. I think I did – Chase. Chase reports organically to your business credit report. Ford Motor Vehicles reports organically to your business credit report, Toyota reports organically to your business credit report. So they’re the things that we teach people. We know exactly who reports, what you can buy from them or what kind of credit they’ll give you and show you how to build a business credit profile. That’s considered strong. And strong is 15 trade lines plus. You may have it, Tony.
Okay. Let’s, let’s get, let’s get into the nitty-gritty of it. So let’s say you get this all set up, right. And you know, you got your trade lines set up reporting all that good stuff. So how do you take that and go and find enough? Cause like, you know, credit cards – getting a $5,000 credit card, $20,000 credit card, maybe even 30, isn’t that hard as long as you have decent credit and all that kind of stuff. But when we’re talking about purchasing properties and we’re, we’re talking about 50 to 100,000 to potentially hundreds of thousands of dollars. So tell us, once you have that set up, how you can get lines, what they cost and all that kind of backend stuff. So people can understand that part of it.
Okay. So here’s, here’s what I like to tell people. The business credit is never going to get you an unsecured line of credit, never. And here’s why, because people like me are experts in building business credit. So not that I would ever do this, but there’s sort of people who would I could build a business credit profile, get it up so that where I’m being recommended for five, six, $700,000 in credit, go to a bank at an unsecured line of credit, pay myself salary a hundred thousand dollars a month until the 500 grands go on and go up. Company is out of business, shut it down. They don’t have any tied up at all. That’s never going to happen. If you’re going to get unsecured, if you can get it, write a check against it, they’re going to tie up an asset or you.
Okay. So what, so what is the difference between someone going and getting a loan with a hard money lender or a bank doing a personal guarantee? And what you’re talking about, is it mainly just the fact that you’re not having to do a personal guarantee?
Well, yeah, and here’s, here’s where I was going with this as it pertains to real estate when I went and I had all my properties, I didn’t want 300 loans. Right. So I started doing blanket loans on X number of properties. And the first thing they did was pull my business credit report because I wanted the loan in the business name. I knew I had to personally guarantee it, but I didn’t want to reporting on my personal credit at all. I only wanted it reporting on the business credit, which just increased everything exponentially. And that’s what I did. So that’s where I was going with it. But again, you’re right. It’s not difficult to get a twenty-five thousand dollar credit card or a 50. Well, 50 is a little difficult personally. It’s it’s rare. But in the business credit world, it’s not rare.
It’s not rare to get a hundred thousand dollar credit card. It’s not rare to get a hundred thousand dollars line of credit from Home Depot. That’s the difference? So where people say to me, oh, I need cash. Well, what do you need cash for? I want to buy the properties. Okay. I get that. You’re going to have to personally sign on the dotted line or you’re gonna have to get private money to do it, which is the better way to go anyway, usually. But it comes to rehabbing. What are you going to do? You’re going to borrow that private money at 18%, 20%. You could you could rehab yourself if you could, if you’re flipping again, it depends on your approach. Are you flipping in a hot market? Use the credit cards. You’re not paying any interest until the 30th until they report. So the 30th day get it sold. It just depends on what you’re trying to accomplish. And again, this business credit isn’t about real estate. It’s about all businesses, right?
So most of the money you’re talking about is mainly for rehab money. It’s not necessarily for purchase money.
Okay. So people are still going to have to go get hard money loans, but then so, so the example that you gave when you were waiting for that $30,000 draw, and you said you took 10, you know, 10, 10, 10, and put it onto their properties, you had already had someone fund that $30,000 in repairs, correct?
Correct. I had Home Depot fun and I had a high limit at that time. I think it was a MasterCard that I was using that I was paying my contractors with.
Okay. I got you. So you used business credit for the materials, also business credit for the credit card to pay your contractors?
Correct. And then put the house on the market. Typically back then two days it was sold. 30 days it was closed, on to the next one. By then, by then, I’ve already closed on those three new ones. I’m rehabbing those.
So what happens if you don’t close on them in the 30 day period? I’m guessing you just make payments on the
Yeah. You just make payments on it. Or I usually had it. At that point I had built it up where I had enough cash. I could have just paid it off. Anyway. That’s generally what I would do. I would just pay it off. I never liked to not have it available to me. But again, I was scaling. So I was, you know, start off with, with 1, 2, 3, next thing you know, I’m doing six and I’m doing 20. Matter of fact, when the market crashed, I had 38 properties on a construction, 38. My mistake was I went out in the suburbs. I was doing inner city row homes because they were easy. You walk in. I knew exactly what it costs to rehab. And I said, well, I’m not making enough money. I’m only making 20, 30 grand a sale on a $60,000 property, which is good.
I went out and to the suburbs, sort of buying 250, 300, $400,000 houses. And then the market crashed.
Oh man. And that was, that was in New Jersey. You said, right?
Yeah. I had one that had a had 140 foot barn on the back of the property, 140 foot. And I went in and it had 1957 Chevy in there. It had old equip. It had just been abandoned for years. That’s the only one I didn’t lose on. Cause I sold all the stuff at the bar, but yeah, that’s, that’s what happened to me. I was out in the burbs. My wife was begging me to stop and I was like, no, no leverage more baby. Get more. So that’s what your, your initial response about being responsible with credit? I wasn’t, I was overeager.
But you also didn’t know what was coming. I mean, the chances of that happening again is pretty, pretty slim, right?
Oh yeah. We were just discussing that before. I don’t see that in this market at all, it’s not even close, you know, back then we giving money to people who shouldn’t have gotten money. You had a pulse, you got a mortgage.
If he didn’t have a pulse, I think somehow we’re able to get people mortgages under other people’s names.
It was crazy. I remember sitting across the table on a settlement and this woman last-minute the mortgage company said, Hey, you’re going to have to give her a second mortgage. And it was nothing. It was like five grand, whatever. And I said, fine, I don’t care. I know if more, I knew I was never getting paid. And I was sitting at the table with her and everything settled. And I hand her the keys, the title clerk walked out, the mortgage company rep walks out and I turned to her, I said, you’re not even going to make one payment, are you? Yes I am. Five months later, six months later, I owned the house again. She got foreclosed on that quickly and I ended up buying it from the wreck. It was crazy back then. It was just insane. Yeah.
So I have a question for you. So I’ve got, this could be really good. I don’t know if you can do it on this, but I’ve got a big project that I’m going to start probably later this year. So I own a co-working space. It’s, I’ve got a 17,000 square foot building on a couple acres and then I’ve got two acres in the back that I can do another about the same 17,000 square foot building on. And it’s going to be like industrial, like flex space kind of thing. So a lot, I mean, there’s going to be labor involved in that, but there’s gonna be a lot of materials for that too. So I can go get a bank loan and have them fund it, you know, five, 6% interest, whatever it is may have to put 20% down. It’s going to be a multi-million dollar project. So something like that. Do you see me being able to do a project like that, where I could fund a lot of materials on credit lines, knowing that it’s a, probably going to be a six month project at least?
No, I don’t think I would. I don’t think I would. Here’s how I like to describe business credit. Business credit is credit that you’ve going to want to use in your day to day operations. For example, is that an office you’re sitting in right now or your house?
It’s an office.
Perfect. Okay. So if you need a furniture for your office, you should get that, don’t use personal credit cards, use either business credit card if you already have one, or go get staples to give you $10,000 a credit, which they will, they’ll give it the business name truck drivers. They need it for fuel. Like they’re spending 10 grand a month on fuel every month. They should get credit cards in the company name from the fuel suppliers to buy that fuel. Real estate where, you know, you guys, you’re dealing with masters, your audience are higher level but beginners really need business credit because most of them have no cash, right?
Most of them have. They’re just getting into it and they’re not sure how they’re going to do it. But it’s really business credit is – better description will be corporate credit. You’ve probably heard of that. Alright, so corporate credit. You’re building that building and let’s say, you want to advertise you. Do you want to print a million flyers? I own a printing company. You come to me and say, Steve, I want to print a million flyers and I say, great, Tony, it’s a $150,000. And you say, yeah, I need terms on that. I need 45 day terms. You fill out a credit application. I pull your DUN report. Yeah, you’re solid, I’ll give you the 45 day terms. That’s corporate credit.
You use it for media too, because you know I’ve got a, I’ve got a TV program where I implement and buy media TV commercials for real estate investors around the country. And one of the things we have issues with is they don’t have media credit. And so the, the media company will make make them pay up front. So for my, for us, it’s hard because we have to get three checks from the investors at front so that we can pay, you know, so it’s, you know, so something like that, they could go to the Dun&Bradstreet or some kind of credit bureau and hopefully maybe use the business credit that way.
It’s exactly right. Matter of fact, it’s funny you bring that up. My biggest customers were advertising agencies and they always wanted terms. They never wanted to pay up front because they were giving terms to their clients. Right. Same. You’re literally dealing with what I’m talking about.
Interesting. Okay. That could be a game changer for that company, for sure. Because if we don’t have to collect three checks up front for, you know, dozens of investors at a time.
Yeah. You just, just got to build up a profile where people are comfortable giving you access to their product service, whatever it is without you paying upfront. That’s really what it boils down to. I can tell you the government won’t do business with you if you don’t have a strong business credit profile, they won’t. Or they will in a very small scale. When I was doing work for the government I kept asking, they had a purchasing, why am I not getting bigger projects? She said, well, we pulled your DMV. It’s kind of weak. Give me six months, six months later, I was doing million dollar projects. I just had to build that profile. I didn’t realize that the government was pulling our profile. So, and customers complete your profile. If I wanted to Tony, if you wanted me to, let’s say, invest in that 17,000 square foot building. First thing I would do is pull your business credit profile and see, do you pay your bills?
Are you talking about as a bank or as an individual?
Yeah, there’s not too many individuals that would pull it. Now. Maybe you’re different. Where if you lent on a project, you would you’d want to pull it. But I could see it being beneficial, especially if like, so let’s say you go to a local bank and they pull your personal credit. But if you went to them and said, Hey, by the way, here’s my business credit. You’re saying that will go even further.
Exactly. I’ll give you one final example. I had a good friend who owned you know, some real estate, but he had a fruit stand fruit, vegetable stand in the winter and an ice cream stand in the summer, up in Boston. And he was doing really well. I mean, he was doing probably 400,000 per year on both. So six months, he just earned 400 grand. Seven 80 credit scores. So he had great credit, good PNL. Applied for an SBA loan for 50 grand. That’s it not, not this SBA thing. We just did this year. I’m talking about a normal SBA loan before all this stuff happened, they denied him and he came to me. He goes, I don’t understand why was I denied? I said, well, what’s your business credit profile like? He’s like, what’s that? So I said, let’s pull it.
There was nothing there. I said, this is your, I said, this is your problem. I said, why don’t you build this? And I showed him how to do it. He went back nine months later, applied again and got an automated approval for a hundred grand. He only wanted 50. Got an automated hundred thousand dollars approved. Do you think that was a game changer for him?
From the SBA or somewhere else for?
New Speaker (27:00):
SBA. Same, same thing. Matter of fact, the closing the loan officer for the bank, because you know, banks were actually the ones who funded, not the SBA directly. And the loan officer said, I don’t understand. I remember you got turned down for 50 grand. How were you able to get an automated a hundred thousand? She had no idea. They don’t even teach the loan officers this. So it was a game changer.
And I’ll give you another example where they don’t teach. I was standing at Sam’s club.You know what Sam’s club is right? So I’m sitting at Sam’s club and I’m listening to a woman,apply for our MasterCard. And Sam’s club has a MasterCard for business. They have two versions. They have the in-house one where you only can spend it there. And then they have the traveling version, which you can use anywhere. So she’s applying and she leaves her social off the application. And I’m standing right behind her. And the rep at Sam’s club says, no, no, no, I need your social right here. And she’s pointing down to the application and the woman says, no, you don’t, run it that way. Send it into the bank. She looked at her like she had three heads and but she did it. Now. I know exactly that this woman must be a customer because of the words she’s using the things she’s saying about five minutes later, the reps on the phone again, and with the bag.
And she turns around and says, no, the bank wants to talk to you. They need your social. She said, no, you don’t tell them to run it the way it is. It’s synchrony bank was the underwriter. Five minutes, maybe six minutes later, she’s approved for 25 grand. Now here’s the whole point of the story. The customer service rep at Sam’s didn’t understand. And the lender, the rep at the lender didn’t understand. They don’t even teach them. Now why? Why do you think they don’t teach that? They don’t want them to know about it? They don’t want you to know about it. If they can get you to personally guarantee, it they’re good. Right? So this woman got a twenty-five thousand dollar credit card for business without a personal guarantee. And only because she understood the process and how it works.
So to wrap up here, it sounds like this is a great way to get you know, business lines. So it’s not on credit and hopefully improves your personal credit. Cause if you’re tying up these lines, then it’s not showing as high credit or high percentage of credit based on how much you have of credit. But, but the thing most, I think that, that I I’m trying to understand and make sure I understand is that this is more for people that are probably a little more cash strapped, where they just need that 30, 45 day, maybe even 60 day period of money to be able to do deals, turn the money and use that money to leverage, to make more money.
Exactly. That’s exactly what I would use it for. If I was doing real estate, like I was before I would set it up exactly the same way. I like to keep my cash in the bank and I don’t have to spend it.
Yeah. Yeah. And even on projects, like you said, I mean, you can borrow the money at a higher rate, but if you can get these lines and when you get these lines, if you pay them off in 30 days, you’re not really paying interest. Right. Just like a normal credit card. Right? Exactly. Exactly. So if you’re doing that on multiple projects, you’re saving hundreds, if not thousands of dollars a month on holding fees and that makes projects more profitable.
Exactly. Exactly. And since you’re technically paying cash for the product, right, because you’re swiping a credit card negotiate better deals.
And do you get points on those too?
Oh yeah. You can do you get points, you get all kinds of things. You get cash back. There’s a million ways to skin the cat, so to speak, but it’s just good to have the options.
Yeah. I love saving money, but my wife loves the points. Cause she can book travel. We have like a million credit card points right now because of COVID we haven’t traveled as much. And she’s like, what can we do at these points?
Yeah. I’m all about the cash back, baby. Give me that cash. I just, I’m a capital one freak, even though I know they’re a bad card to have for business. As soon as I see, I saw a new card come out, it was 5% back of the grocery store. I’m like, give me that card.
Amazon card. Yeah. Amazon, Amazon whole foods card, man. 5% cash back. Heck yeah.
And I gave it, handed it right to my wife. I said, this is your new credit card. That’s what you use. But anyway, so and look. Here’s the thing. Anybody can build business credit. Anybody, if you start an LLC today, you can begin building business credit. So even your listeners out there are thinking about getting into this start an LLC. It has to be an LLC or better. It can’t be a sole proprietor because that becomes personal credit. Right? Cause you are the business. You can, you can begin almost immediately, but you’ve got to understand the fundamentals, which is setting yourself up to look professional. In other words, I don’t want to hear, I buy firstname.lastname@example.org. I want to hear email@example.com, right? Or whatever your URL is. I deal with this every day and I’m going to tell you, 99 out of a hundred business owners, I talk to have a Gmail or a Yahoo account.
I’m always embarrassed for him. Like, like lenders, look at that and go, eh, a little concerned you know, have a real address. Don’t use a PO box. Real estate investors fall down on this all the time. Have a real address, either a commercial building. You know, the one you own, hopefully or a virtual office or your home. Do not use a PO box. Don’t use Ipostal. Don’t use anything that looks like a storefront because that’s an automatic red flag for fraud. Automatic. There’s phone numbers, almost every real estate investor I’ve talked to, when I asked for their business phone, they gave me what, what do you think they gave me?
Of course they do. Here’s the problem. There’s something that’s been around a long time. You remember? Cause you remember newspapers. It was called the national 411 database.
I thought that you would say phone books.
Yeah. Well technically yes, but this is the digital one where you dial 411 and you asked for Joe’s pizza up the street and they connected you and gave you the phone number. Remember that? Okay, well that database still exists. You can’t list a cell phone there. You can only list a real phone. So the problem is nobody wants to put a phone on their desk. What do you do? Well, the answer is obvious. You get a voice over IP, but not Google voice. Google owns that number. You do not. So if you try to list it, it comes up as Google. Go to a company like RingCentral, Grasshopper, get yourself an 800 number or local number few bucks a month. You own that number forever. It’s a great marketing tool anyway. And then that’s listable with the national 411 database. That takes your credibility factors up times 10. When a bank searches, they see you listed the national 411 database you’re legitimately in business in their eyes.
Yeah. Yeah. Okay. Well, good stuff, Steve. We got to, we got to wrap up here. How can people find you? You already gave a website. Is that the domain you want them to go to?
Oh, actually what I’d like them to do is go to creditsuite.com and I’ll message this to you. Let me give you the exact one. I believe it’s forward slash podcast. It is. Four slash pod, P O D – E I N. So creditsuite.com/pod-ein. And they’re going to get, what they’re going to get there is a free guide on how to start building your business credit. Nobody’s going to call you, your just going to get a free guide.
Very cool, awesome, good stuff. Well, I’m going to get my teams looking into this. I’ll probably call my banks or just email them and say, Hey, you need to start reporting to the bureaus and see how that goes and see if we can start building some credit that way and get some more lines set up.
Yeah. Go get your free report. You may already have more than you realize.
Cool. Good stuff, Steve. I appreciate your time. And yeah. Good luck to you. Let’s reconnect. And if you’re in Carlsbad or San Diego hit me up and we’ll we’ll meet up.
I’m going surfing. I’m going surfing, baby.
Let’s do it.
All right. See you, bud.