Page 110 - Winning The Credit Game Bundle (CK Patrick)

lines. They may also allow you to buy a broader range of prod-
ucts and look more impressive to potential business partners and
creditors in your credit report.
That’s good for your business if you are looking to expand
and you want the ability to buy more supplies or equipment and
pay for these items after you’ve expanded your operation and
are profiting from them . But it can also be risky because if for
some reason, you don’t profit from the new purchases, you can be
stuck, unable to pay the lender back a larger amount of
money. In that case, both you and the lender face negative conse-
quences.
You must not miss or have any late payments on these
accounts, because building credit in this manner is solely based
on payment history. This fact makes business credit much more
unforgiving of these types of mistakes.
That’s why these more flexible and expansive lines of trade
credit are considered “Tier 2”: they’re best for businesses who
have already learned to reliably turn supplies and equipment
into profit by using basic trade credit lines for at least two
months.
You may also be introduced to fleet credit in this tier. Fleet
credit is used by companies like Amazon that have a fleet of
vehicles. Although you don’t have to have a “fleet” of vehicles,
this type of credit line allows the ability to manage fuel costs and
save on expenses such as vehicle maintenance.

TIER 3: REVOLVING CREDIT

As you continue to build your business credit history, you will
apply for more challenging and more flexible lines of business
credit after each milestone. Now that you have proven your
ability to pay back your debts thoroughly using net-term
accounts, it’s time to look into tradelines that require more trust
and offer more power.
Lenders may now be willing to offer you revolving lines of
credit which do not require payment in full each month. For the

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