When you start a business, you will likely receive multiple offers for some type of business credit card. These cards would typically be offered in the name of the business. However, this partly depends on whether your business is incorporated. As a partnership, you have the option to leave your business unincorporated. Then, meeting the requirements for business credit would fall on the shoulders of each individual owner.
Basic Credit Requirements
The credit of both partners in a business will be considered when any lender extends financing to an unincorporated partnership. If one partner owns a larger percentage of equity, the credit of this owner will be weighed more heavily. However, both should have a record free of default, delinquency and other credit issues to qualify for the best credit cards.
Asset Requirements
If an unincorporated partnership fails, the partners will have to resolve outstanding debts personally. This is very risky for a lender. As a result, the lender will typical require collateral on any business credit card. This can take the form of a liquid asset, such as a business's bank account, if necessary. A further option is for one or both of the partners to use personal collateral to secure a loan.
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