Should I use a shelf corporation? – things have changed a bit in 2011

If you are new to building business credit, or if you only recently started to build business credit, most of you will be faced with this dilema. This is something I have wrote about in the past but as times have changed, needs have changed.

In previous times, when you hear about someone looking for a Shelf Corporation, they usually are looking for a corporation with established credit, and for a quick fix to getting credit right away. Let me let you know that those quick fixes can lead to some disasters as I found out, but there are ways to get credit quickly.

The Current Credit Climate

In 2011. acquiring a Shelf Corporation is not only for acquiring business credit in a very short space of time. Now that we are past the 2008 recession, and the credit crunch, creditors have tightened their requirements and many banks have closed. There are a number of things that have changed and gotten harder in building business credit and some are:

Many net 30 accounts which are needed to build business credit require prepaying for new businesses, which makes the process more expensive.
Staples, which was a reliable revolving starter account for businesses that have been only incorporated for a few weeks now requires a three year old corporation.
There are now NO no pg cash cards that can be gotten with a company less than 2 years old. Key bank use to but since they have changed to Embark, they are not doing it anymore.
There are a few revolving accounts that will not give credit to companies less than two years old.(Lowes, BillMeLater and Amazon) to name a few.

So What does all of this have to do with a Shelf Corporation?

Well the bottom line is that building business credit now, is harder than it was pre-2009. Although credit is more available than it was in 2010, it is still a challenge if you want to use a brand new corporation and no personal credit. I am not saying it cannot be done. The Business Credit Bible tells you exactly what you need to build business credit with a new corporation. But if you start building business credit with an aged corporation, it just makes the process that much easier, and you get access to cash.

Many of the net 30 accounts will not require a prepayment.
Companies like Staples and Office can still be used as beginner accounts. Although they may not be in Tier 1, they will be Tier 2 accounts.
You can get approved for cash credit with no pg.
Most of GE Money backed accounts need a two year old corporation and you will have access to all of them.(Walmart, Target, Sams Club, Lowes, Amazon)

It is simply easier with a Shelf Corporation.

So where do I get one of these covetted Shelf Corporations?

First of all, when decided on buying a Shelf Corporation, you have to decide if you want one with an established credit file or not. Purchasing a Shelf Corporation with an 80 paydex can easily run you a couple thousand dollars more than one without a paydex will cost. I personally do not have any Shelf Corporations for sale with an 80 paydex, but Shelf Corp Magic, which was recently reduced to $47 shows you how to acquired corporations, both with a paydex and without for around $100.

I personally sell Shelf Corporations without a Paydex for $1000 and the only other source I recommend is Amerilawyer. There corporations are a lot more expensive, but those are the guys I trust. If you are serious about building a lot of business credit, my honest advice is to startwith a Shelf Corporations.

Marc Augustine

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