Business Credit (Lines Of Credit ) Fleet Auto Loans

what's up youtube welcome to automotive life my name is lucky and today's video is all about credit now we're going to talk about why credit is so important whether you're either buying a car or if you're getting in the automotive industry opening up a rental car company car dealership auto repair body shop or even if you want to flip cars credit plays a crucial part in all these businesses and i didn't know this when i first started so i want to make sure i share this with you guys so you can start building up uh your credit and doing things now now i've told you i've owned multiple businesses in the past but one of the things i didn't tell you guys is i used to own a credit repair business so i'm going to give you some of the tips and tricks that i use to actually uh speed up credit repair and also build credit so this way we can get you rolling so if you guys are going to be a huge favor and gently squeeze the like button it also with the youtube algorithm find more amazing people like yourselves that enjoy automotive content also if you consider subscribing we post really great stuff like this all the time not only cards and stuff but the things on business to help you grow your business very very important and click the notification bell because we are posting three times a week and also you can follow us on instagram automotive.life we are way more popular on there we post funny videos tips tricks everything every single day so make sure you look for that and without any more shameless plugging let's get into the video so the reason why we're picking credit as a topic today is it's very crucial for your business success and your growth you know as i was reading all your comments down below there is one recurring theme how much does it cost to start a rental car company how much does it cost to start a dealership how much does it cost to start an auto repair shop all these things you know they're all kind of the same they all cost a certain amount of money but the goal is we don't want to use your liquid capital to start your business we want to use your personal or your business credit you keep the liquid capital for your bills your overhead and anything you can not pay with basically credit you know when i first started um in 2000 i didn't focus on my business credit or my personal credit so it costed me a lot of money a lot of headaches a lot of growing pains because a lot of you guys are getting really successful really quick and this is why we need to structure you guys correctly when it comes to this now like i said on this channel we teach you guys everything automotive wise but credit is a huge part of this and i'm going to go into each of these little businesses and explain why credit plays a crucial role in each one of these things and also give you some tips and tricks along the way so this way we can go into it now first thing we're going to talk about is personal credit and business credit let's go ahead and start with personal personal credit is is huge when it comes to actually getting your lines of credit for all your different vendors so as of right now you need to figure out a way where you can either clear up your personal credit or get it as high as you possibly can the reason is is you know every vendor we're going to be dealing with let's say rental car company if you open up a rental car company tomorrow first thing you're going to do is okay we need to run your credit for your insurance we're going to need to run the credit for the bond we're going to need to run your credit for uh your actual uh purchasing of cars your lines of credit so those three things right there are all going to require you to have good personal credit if you don't let's take your insurance per se for instance if you have bad insur or bad credit your insurance premium could be required to be paid up in full for the whole year that could be ten fifteen twenty thousand dollars that's a lot of money you know if you have good credit you may only have to put maybe five hundred dollars down to start your policy or a thousand dollars down and you can you know lower your overhead second thing your bond you know rental car companies are not too bad but if your bond is let's say five ten thousand dollars and you have bad credit they may not even issue a bond they may require you to put ten thousand dollars up of your own money into a bond and it just has to sit there so now you tie up another ten thousand 000 of your money you know and then when it comes to buying cars you know i see all these people going out buying 17 cars at one time on their personal credit don't ever do that it screws up your personal credit and i'm going to explain the reasons why we don't want to do a lot of these things now you know as we talk about personal credit this is all going to funnel into the business credit aspect end so you know we just talked about how you know you need these things for your actual rental car company let's go ahead and jump into the dealership end you know dealerships exact same thing if your insurance and insurance is huge if you have bad credit nobody's going to do business with you so you're going to have to pay a bigger down payment or you have to pay your dealership insurance up front and it's very very expensive so we don't want to do that same thing your bond for most dealerships in every state is about a hundred thousand dollars so i've had people with bad credit that we've signed up and got online and they were paying anywhere from 10 to 15 000 a year to fix uh to actually get their bond now it's cheaper for you to fix your credit than spend something like this and the worst thing is i see people do this and they don't fix their credit and it keep continues so make sure like i said credit is important next thing we're going to talk about is your actual like same thing lines of credit none of these banks will uh assume yeah none of these vendors will actually give you a line of credit if you have bad credit i mean it's pretty explanatory but here's the big kicker and this is going to freak out a lot of people that are in the dealership problem most banks that we sell deals to that we do financing through will not do business with you if you have bad credit so let's say you get signed up and you have wells fargo that wants to come sign you up because they like your inventory and you're like oh my god just this bank alone i'm going to sell an extra 30 40 cars a month and they come in and they run your credit and they're like oh geez you're like a 510 credit score we don't want to do business with you so now you just lost that opportunity to change your life to sell an extra 10 15 20 cars a month because your credit was all out of whack and there's a lot of other things like cuddle cuddle is credit you need direct lending that is another thing where they actually run your personal credit to see if you actually are credit worthy and if you have bad credit they don't even sign you up on the program so now you lose all those credit or credit unions that you could have done business with the next thing is is called a title float what a title float is is let's say i sell you three cars in one week let's say the bank is westlake financial i sell three of these cars to westlake my title float is three so after the first week i sell three cars and i sell another three cars the next week i will not get paid for the next three cars until they receive the three titles from the cars before and that's it hugely screws up your business i've had deals where i've actually had like 15 cars in one week go to one bank and it tied up my title float so they only paid me for half of them i couldn't go out and buy new cars i couldn't pay off my my lines of credit that you know and if everybody knows flooring lines and lines of credit they're blowing your phone up where when are you getting funded what are you getting funded all this stuff plays a part when it comes to your personal credit and it's very important that you need to build this because like i said every little speed bump you're going to go to is going to hit this next we're going to auto repair and i know what you're thinking well i've been doing auto repair for years i don't need this blah blah blah blah blah wrong same thing insurance going to run your credit bond you got to get a bond and you got to get certified by the dmv if you don't do that you can't lean vehicles if you don't do that leaning vehicles is a huge part of your business you want to make sure you protect yourself from people just leaving cars and turning your auto repair shop into a junkyard so make sure you get the actual process and get licensed by the dmv so you can lean vehicles second is your vendors you know when i first started i turned down a lot of business because in the classes that we teach we actually teach you guys how to go after big corporate accounts and some of these corporate accounts are net 30 and net 60. what that means is they let's say they give you a hundred thousand dollars worth of cars to fix you fix them and you build them you may not get paid for 30 to 60 days i mean if you're rich you just have a bunch of money sitting in the bank and you can float that that's fine but you need to have lines of credit so you can build this now automotive is probably one of the only automotive repairs probably the only one that actually lets you build your in-house credit with the actual uh vendor but at the same point you'll never get a net 30. it'll be week to week you know and if you mess that up once you're pretty much done so if you want to go after these bigger accounts and you want to go after more fleet accounts you're going to need that actual personal credit and the next thing after that is your your tools and your equipment you know there's nothing worse than you know you're growing you you have multiple fleet accounts you got two new mechanics you're ready to rock and roll you're making money but you don't have the lifts to get them done or maybe if you had an alignment rack you can get some extra stuff or if you want to just get you know some extra tools and equipment for scanners stuff like that you don't want to rely on the snap-on and mac guide they're going to charge you all kinds of interest they're going to hound you every week for a payment and then on top of that that credit is not transferable it's only good on their truck so if that guy retires tomorrow and you try to get more tools from maybe the new snap-on guy you're pretty much sol so you know same thing with auto body credit plays a huge part same thing with all your vendors your um your insurance your bond everything else now what the last one we're going to go into is car flipping after car flipping we're going to go over the difference between personal and business credit and then i'm going to give you some of the tips and tricks i use to actually build my credit up and what we use for some of our students and people we know so when it comes to flipping cars yes you can use credit to do this now when i first started my automotive journey back in 2000 i was fixing cars during the day with my shop but then during the winter time it was slow so i would actually go bartend at night i did this for about two years and i just got sick of it so i went out and got a personal loan and i borrowed about i think it was twenty thousand dollars from wells fargo because back then wells fargo would give you a 20 000 personal loan now i i feel like wells fargo won't even give you a dollar unless you have a million dollars in the bank so but i got a personal loan i went out and bought a bunch of cheap cars 500 800 cars you know kind of what i'm doing right now fixed them all up through you know basically november december and january and then i sold them all during tax season and turned to 20 grand into 60 which was great and so that kind of became my thing when it came to flipping cars but i was never able to do that unless i had good personal credit so you can do the exact same thing if you're you know have a shop in your backyard and you're wanting to flip some more cars and take it to the next level you can do the exact same thing also if you get your mob mechanic license you can start getting lines of credit with all these vendors and once you decide to open up a dealership a shop or whatever you can actually transfer that because it's under the same llc and you're the personal guarantor it'll transfer to any single one of those now we're gonna go ahead and talk about business credit and personal credit and the differences between both of them now you guys have heard me say this before if you go out buy cars for like your rental car company and stuff like that you don't buy on your personal name you only buy maybe one or two but then eventually you want to transfer them over to your corporate credit the reason is is everything you put on your personal credit goes against you your your dti your payment score and i see a lot of these guys that are doing these you know uh turo and rental car courses are teaching people how to get like 7 10 15 cars on their personal credit in one shot and you never do that you want to have good personal credit so you can co-sign for your business which will help build your business credit now when it comes to business credit there are a lot of pros and there are some cons and we're going to go over a few of those right now now when you have good personal credit you get great rates they pretty much bend over backwards you get whatever you want but when it comes to business even if you have the most amazing personal credit the rates are what they are for business so the way easiest way i can explain it is if you are a if you're buying a house you qualify for you know 30-year mortgage at the lowest interest rate but if you go out and you buy let's say a commercial building you know you do get like a 15 to 20 year loan but your interest is higher your down payment is higher and your interest is higher so you don't get all the benefits of you know a personal loan because they know that you're making money with this industry so you should be able to pay higher interest and a bigger payment and it forces the business to pay down their debt which is huge that's the way business is structured everybody thinks oh i'm not gonna i'm not gonna get a corporate line of credit just so i can have higher car monthly payments i'm going to get at my personal line so i have low payments you're a full that's what it's for it's outrun debt outrun uh depreciation everything we're going to talk about kind of coincides with that so let's say you get an auto loan i guarantee if we go to let's say ford and you get a brand new f-150 they're going to give you 72 to 84 months on the corporate end they some of them will give you 72 months but most will be anywhere from 60 to 65 and they'll give you even better lower interest if you go shorter term like 50 and 40 and 36 months there are some businesses that's how we do it my first tow truck i think it was like a 45 month uh actual uh loan but you know when you sign up with your business credit and you co-sign for your business that tow truck now or the car rental car that you bought stays on your business credit it doesn't affect your personal and that's the best thing about business credit so if you get a business credit card for a hundred thousand dollars and you literally go out and spend ninety thousand dollars tomorrow your personal credit will not suffer you won't go down a single point because it's only the business so like i said you do have to pay higher interest you do have to pay shorter terms but like i said it doesn't affect your personal credit and that's why like when it comes to the dealership and rental cars don't buy any cars unless it's on your corporate credit because some of these people i'm actually going to interview one later this week that bought the 17 cars on their personal credit she can't buy a house she can't buy any more cars her one of her credit cards actually cut her off because they thought that she was just maxing everything out and getting ready to leave the country they they pretty much she screwed up her personal credit for years the only way she can get out of it is if she actually gets a loan to take everything off so we're working with a few of our vendors right now to see if they'll actually give her a loan to take these things off her personal credit so she can get her personal credit back to normal where she can be able to buy a house and some other things now she's going to have to put about 20 30 000 down to get out of all these cars but hey it's the nature of the business so instead of doing this way that's why i wanted to make this video about why credit is so important so you know to build your personal credit there's a bunch of stuff you can do but one of the things i'm going to tell you is your credit is your investment i have a friend of mine his name is will roundtree if you've seen him on my channel and and on instagram you know he specializes in helping people with their financial business and fixing their credit and one of the things that he does he has some of these credit packages that he fixes are almost ten twenty thirty thousand dollars and people are like well why would somebody pay ten twenty thousand thirty thousand dollars for their credit it's because people that actually use it for a business know how valuable credit is you need to treat credit like an investment every dollar you put into your credit the more dividends it's going to pay back and what i mean by that is you know if you get 500 bucks and your credit card let's say you could use 300 of that on your credit card do it every time you get 500 take 200 of that pay down your debt keep the 300 bucks in your bank and just get in the habit of doing that and i promise you like i said you will see dividends and you'll start doing that if you have um you know three four thousand dollars and you're trying to put three four thousand dollars down on a car that's a you know gonna get you a high interest high payments why wait a month or two pay a company to dispute all the bad stuff on your credit make some deals with some of your vendors and then also there's a lot of companies out there that sell trade lines one of the things that a lot of people don't realize is the more trade lines you have on the credit it's not a bad thing it shows more available credit which shows more liquidity which raises your points even more so instead of taking that three thousand dollars to go buy a car that's going to give you really high interest rates take a month or two step back get five hundred dollars of each of the or get uh break that three thousand dollars in the 500 go to wells fargo bank of america u.s bank discover um american express uh a few local credit unions and get secured credit cards give them 500 bucks they're going to give you a credit card in return and then you just you start using it you don't use it a lot you know i know it sucks because you're going to tie up that three thousand dollars in credit that you use and you're still paying interest on it but you got to start somewhere and if you get a bunch of cards at once you're going to your score is going to jump up dramatically because a lot of these people well i got one secured credit card and i got one you know small thing no go out and get like five six seven get as many as you can as many secured credit cards as you possibly can the next one is a cd loan if you go to any of these banks i recommend going to like a small credit union because they're more uh available to work with you they have loans where like if you give them 1500 bucks they'll get a cd and they'll give you a loan against your cd as collateral so every month you go and you pay 50 bucks 50 bucks and it's called an installment loan so your credit cards are what's called revolving and then the other loan is installment loan so if you get two of those on your credit profile it speeds up very quickly and you could do this with multiple banks you can go bank america u.s bank wells fargo all your local credit unions chase pnc whoever you have in your area navy fed has a really really good one i only use navy fed for all my stuff because they are very willing to deal with people they pull from transunion which is good so most people's transgender is higher so this will be available to get hopefully a credit card or actually get a starter loan or credit loan uh credit builder loan now that you have those things there's other ways you can buy them there's companies out there that sell lines of credit now i'm going to say a few companies and i'm sure people are going to be triggered and be like they suck but hey you know what i used them um uh was it new coast financial you can get a 5 000 line of credit with them for like four or five hundred dollars they charge you for it you can't really get anything because all their crap is junk on there but you're paying for the credit line um next one is uh my jewelers club now a lot of people hate that thing but i'll tell you what hey i got a five thousand dollar line with that one with my credit cards and jumped my score up dramatically i still set some of my students up with it today but you know it takes a little bit of time be patient but like i said you got to invest in your personal credit next thing is getting your friends and family to get you as an authorized user so let's say your mom or your dad or your brother your sister have a mastercard it's a 5 000 limit but he's had it for 10 years the second he adds you on there you get 10 years of history on your credit report and your score dramatically jumps up so when we have people sometimes in the dealership we actually will finance them like hey i'll tell you what call your family add add them on to a credit card do something like that we're going to hold the loan for 30 days we're going to run your credit in 30 days and see what happens and a lot of times these things will add up on people's scores and jump them up so people do it before they buy mortgages they get two three cards added on to their profile and they shoot up now authorized users is a is a really cool thing because you could jump up like instantaneously and you can go up there you can actually request not to give a card to that person you just want to add them as an authorized user so if you're worried about adding a family member and then messing up your credit you don't have to worry about it just tell them they're not allowed to have their own card so once you get that established you can go ahead and go for that and start adding more and more cards if you can add three four at one time your score will just jump up i've seen people from zero go to 780 with three uh tran or excuse me three authorized users and it happens really quickly now here's the downfall with authorized users if that person adds you and they're maxed out their credit card or they have a late payment it goes against your credit as well so it is a double-edged sword you get all the benefits but do you get all the problems if they don't pay their credit cards on time so if you do do this make sure you have a very clear you know knowledge of how it works and tell them look i don't need the credit card i just need you to add me for three to six months after that take me off and most people will because like and also like when i was younger i paid for it i was giving people four or five hundred dollars hey add me under your card for three four months and then take me off and so they would add me on for three four months and take me off and then i'd get the history my score jumped like five ten points twenty points three uh fifty points and it just kept adding up and up and so until you get your own established credit cards and also if you want to do something for long term like you have american express or something like that have them keep you on there for a little while and then apply for your own so this way hopefully they see that you know the person that you have the american express with is paying and they'll extend some credit to you as well last thing i want to talk about is some of the business credit that you can get now in the automotive industry there's lots of loans lots of lines of credit and lots of equipment loans and structured loans that you can get for your business but there's a big myth out there that oh you don't have to do any type of pg which is personal guarantor on any type of lines of credit if your business credit is built up i'm here to tell you they are 100 full of there is not a single bank in this world that will give you a line of credit or a business loan without some sort of personal guarantor or assets on the line so everyone's like oh well i got a million dollar line of credit and i didn't have to personally guarantee it guarantee you it's it's tied up to either their business assets their business account or their actual like a cd or something they have some sort of guarantee where if this person runs they'll disappear because back in the day i call this the donald trump status they would start two buildings let's say you have two restaurants this restaurant spent tons of money got fancy equipment fancy stuff spent a bunch of money in marketing and they built it up really hot and then they had this other one that was a very small restaurant was bare bones but it was built to make money and save money so this one would save save save and this one will grow grow grow and make a long story short this one right here would file bankruptcy so they'd file bankruptcy and then this business right here would come and buy this one for you know pennies on the dollar and start over again and now they have no debt and this business owns this one outright so now this one's making all the money with you know pretty much no debt they would do this stuff they would literally get an llc get a bunch of money file bankruptcy open up another llc get a bunch of money file bankruptcy those days are gone the banks are hip to it nobody cares about that stuff anymore if anybody tells you they can get you alone without a personal guarantor i am truly shocked now there may be some small little tiny mom and pop banks that do that but unless like i said you have some sort of business relationship or they want to tie up your collateral or they want a personal guarantor it is almost impossible so if you hear me talking about corporate lines of credit it's because you have to personally guarantee it so you need to have good personal credit you could show a million dollars in the bank they don't care we had a guy in houston i did a video about him a few months ago same thing million dollar millions of dollars in uh the bank account and they didn't care they wouldn't give them any types of lines of credit it was embarrassing so credit is king cash used to be king but now credit is we want to utilize your credit to build up your business and help you grow so if you've learned anything like i said gently squeeze the like button i truly appreciate it also if you consider subscribing we're posting all kinds of stuff automotive content and now some business content which is kind of fun um also follow us on instagram automotive.life and we'll see in the next video [Music] you

Channel: Automotive Life

Views: 21,006

Rating: 4.9846888 out of 5

Keywords: business credit cards, business credit card, how to build business credit fast, how to build business credit in 2021, business credit, credit repair, tradelines, building business credit, how to get business credit, build business credit, business lines of credit, business credit scores, credit repair business, how to build credit, how to build corporate credit, lines of credit, fast credit repair, cpn number, credit sweep, transunion, equifax, experian, repairing credit

Id: 4vRhk40qIW8

Length: 23min 14sec (1394 seconds)

Published: Mon Aug 09 2021