Credit Cards For Business

Yes, LLCs can obtain credit union business cards to help them establish a repayment history. As one of the most common business structures, LLCs are prime candidates for credit union business credit cards. Credit unions often offer specialized business credit card products for small businesses, including LLCs. 

When considering the best credit union business credit cards, LLC owners should evaluate their specific business needs and compare offerings.

The benefits of a credit union business credit card are numerous and often surpass those offered by traditional banks. Key advantages include:

• Competitive interest rates: Credit unions typically offer more competitive rates than traditional banks. Using a credit card rate change calculator can help businesses understand potential savings over time.
• Reduced fees: Credit unions generally charge lower annual and transaction fees than conventional banks.
• Personalized service: Credit unions provide individualized attention and financial counseling to help businesses make the most of their credit cards.
• Member-focused approach: Since credit unions are member-owned, they prioritize service over profits, often resulting in better terms and conditions.
• Local decision-making: Credit unions make lending decisions locally, which can benefit businesses seeking credit approval.

Most credit unions require a good credit score for business credit card approval.  While requirements vary by institution, applicants typically need a minimum personal credit score of 680. However, some credit unions may consider additional factors beyond credit scores. 

Other factors that influence approval include:

• Personal credit history: Your personal credit history plays a crucial role in the approval process because it shows how well you manage credit. This includes your payment history, credit utilization and length of credit history. Maintaining strong personal credit habits will significantly improve your chances of approval.
• Business credit history: If established, your business credit history will be evaluated to assess your company’s creditworthiness. Credit unions will review your track record with other lenders and vendors, including payment patterns and existing credit relationships. 
• Time in business: The length of time your business has been operating can impact your approval chances. Credit unions typically view longer-operating businesses more favorably as they have proven stability. Most credit unions prefer businesses that have been operating for at least two years. However, some may consider younger companies with strong financials.
• Annual revenue: Your revenue stream helps credit unions assess your ability to repay. They will evaluate your total revenue and monthly cash flow patterns to ensure you can handle credit card payments. Strong and consistent revenue growth can strengthen your application significantly.
• Debt-to-income ratio: This ratio helps lenders evaluate your current financial obligations against your income. Credit unions use this metric to ensure you’re not overextended and can comfortably manage additional credit card payments. A lower debt-to-income ratio typically improves your chances of approval.

The application process for a credit union business credit card involves a few simple steps:

1. Membership qualification: First, verify eligibility for credit union membership based on geographic location, professional affiliation, community involvement or family connections.
2. Documentation requirements: Gather the necessary paperwork, including business license, EIN, personal identification, financial statements, tax returns and a detailed business plan.
3. Application submission: Complete the membership application and provide personal guarantees while ensuring all business financial information is accurate and complete.

Before applying, consider revitalizing your business routine to ensure your finances are in order. Creating a budget can help demonstrate financial responsibility to potential lenders.

Getting approved for a credit union business credit card with no revenue can be challenging, but it isn’t impossible. New businesses can use our starting a business calculator to project future revenue and expenses, which may help support their application. Factors that can help secure approval without established revenue include:

• Strong personal credit: Maintaining a solid personal credit history becomes crucial when business revenue isn’t established.
• Business plan: A detailed business plan showing projected revenue and your ability to save money can strengthen your application.
• Personal income: Credit unions may consider personal income as a backup source of repayment for business obligations.
• Collateral: Some credit unions might offer secured business loans as an alternative for new businesses without revenue.
• Relationship banking: Establishing a business checking or savings account with the credit union before applying can demonstrate commitment and financial stability.