Aspects of a small business credit card

creditcards_1103606.jpgWhen you are shopping around for a small business credit card you need to look at the interest rates and other aspects of the card. It is important to look at what makes the card a good investment for your company and what things are pitfalls with the card. A business credit card is a great way to help you establish business credit and it gives you an opportunity to build a name for your business as well. A lot of businesses find that using a credit card is a better option that using loans as the interest rate is lower and you can easily get a larger limit than what you will get with a loan. So what are the things you need to look at before you agree to the terms and conditions of your credit card? Here is a simple guide that will help you out.

Line of credit
How much credit will you have access to? This is something that you need to consider, especially if you want to rely on the credit card to help you to purchase a large equipment purchase or to rely on it for other things. If you are not granted a large line of credit will you be able to expand it in the future? This is something that you have to consider as you are looking around to find the best credit card.

Interest Rate
The interest rate is something that you have to negotiate. Many credit card companies will give you a low interest rate initially but it can easily skyrocket after a promotion ends or when you have used a fair amount of the credit limit available. The interest rate can cause you to pay a lot of money for the use of the card and it may not be worthwhile for you to even use the credit card. If you already have a credit card, work with your issuer to try and get them to lower the interest rate.

To get the best interest rates and to even be considered for a small business credit card, you may need to furnish the lender with some type of collateral. It is important that you consider what collateral you can use for the credit card. Equipment can be used but in some cases you may need to use some of your personal assets in order to get the credit card. You really need to focus on separating the personal and business credit as much as possible in order to keep your tax filings clean and easy.

What is the credit card issuer willing to give you? There are a lot of credit cards that will provide you with rewards. What type of rewards you get are important to helping you determine if they are worthwhile. Determine what you need. Some companies need to have rewards that offer discounts on air fare where others want cash back rewards.

There are many business credit cards that make sure you have some type of annual fee to pay. How much are you willing to pay in fees? You need to carefully consider this when you are applying for the credit card as the fees can seriously outweigh your decision to opt for a credit card over another loan option.

Grace Period
How about the grace period? How much time will you have to pay back the money that you charge? If you have plenty of time, it can enable you to make a larger purchase and even pay a smaller amount if the interest rate is low. Usually you have a grace period of 28 to 30 days.

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