The older your business, the more credible you may appear. Once you have gone down the road of completing your compliance items and opening your profile, you will work your way up the business credit ladder to bigger lenders and larger lines. This is when an aged shelf corporation can really help you out. Think of it as one more tool in your box or another weight on your side of the scale.

So you built your businesses credit profiles in a few months with a corporate credit program and you’re well on your way to getting that big cash line that will allow you to grow your business quickly. At this point in the business credit journey, you will start to encounter new lender requirements. Getting that office supply vendor line, business Visa or trade line was easy… getting that cash line or loan is, naturally, going to be tougher. One of the aspects of the scrutiny that your business will be under is its age. How old and how long has this business been around? Of course, a brand new business that was formed the same time your DUNS number was registered, doesn’t scream credibility yet. This may put a lender in a position to request a personal guarantee, or decline the application or suggest a different interest rate… in any event, that’s NOT what you want to happen.

The more assets you have for your business along the way, the better. Having a corporation that is several years old is one of those assets. Consider yourself a lender and one of the things set in stone as part of the requirements is “For businesses less than 3 years old, require guarantees from the owners.” Sounds logical enough for risk management purposes… but it could be a number of things that a new corporation and one that is several years old experience differently due to the age of the legal entity.

How to Use a Shelf Corporation to Build Business Credit

• Buy a Corporation at least 2 years old (recommended), if not, then at an age that is right for your purposes.
• DO NOT change the entity name. Banks view name changes exactly as “starting over”.
• Keep all of your original articles, agreements, by laws, resolutions and release forms in one place with all of your other important corporate records.
• Make yourself a Director and Appoint yourself as an Officer of the company.
• Apply for any business licenses or operating permits your business requires under the name of your aged corporation.
• Find the assistance of a professional business credit service provider to help you get going.