Hello, I have a question for you guys with multiple parks. My business has been growing fast and I am now buying my 4th park and 7th property. I have been using a credit card for the individual managers to use for park expenses, home repairs, utility bills and general expenses associated with the park, used by both us and the managers. I use Capital One Spark Businessand set up alerts any time a charge is charged it sends a push notification to my book keeper (the wife) and my phones. We keep the limits low and pay off the balances every month. We have our managers scan in every receipt and we reconcile all money in and out to the penny every month. Its been working well.
PROBLEM, the accounts are tied to my SS # and show up on a credit report. Putting all the utility expenses on the cards along with home inventory repair expenses runs the monthly balances up high enough to look like I personally have a spending problem. It has lowered my credit score 100 points from in the 800s to low 700s. I have tried to get the credit card company to help but they don’t have any suggestions.
Lay it on me with your suggestions. We are trying to scale and keep things stream lined and simple as we buy more properties and continue to grow.
I operate very similarly across many parks. It’s less about the $ and more about utilization as a %. I.e. if you get your available credit taken up across cards, usage as a % should come down. You do not want to exceed 20%, and ideally be sub 10%. Paying off balance 2x a month vs 1x a month could also help. Mint is a helpful app to help you look at all of this comprehensively in one place.
I have an American Express that I applied for with my LLC, doesn’t show up on my Credit Report and isn’t tied to my SSN. Maybe try a different card issuer?
Originally started using personal cards and then would call in for credit limit increases regularly . So available revolving limits went high . Was very methodical about all this.
The way i used to operate was getting a CC for each entity. Card of choice was AMEX simply cash back or something like that. Best as I remember… it would not show up on my credit report , downside limits were low for new entities. You did have to provide your personal info at the same time.
Since… I have stopped doing any CC… have converted to an all debit operation. My fear is subconsciously ( and there is some supporting date) that thinking you get points , stars, brownies whatever. and you are tempted to make a spending versus where you might not otherwise… versus debit is real money leaving the bank now… More of a personal finance concept not sure used by business or if it has merit.
And honestly, im a small outfit, we do turnarounds… pump money in … and fall behind on reconciliations and inputs when you got 10 salad plates spinning of one time and you don’t want to miss you didnt have enough for the 8k CC bill that month …
You’ll have to check with your specific bank on functionality and controls, you can do deposit only cards ( but not helpful with spending ) . And know of what kind of Frog protection you are getting, account limitations etc. and the ability for someone to see the balance so there should be some trust or perhaps sweeps implemented.
Get a Dun and Bradstreet account and get company accounts to replace those with the SSN.
Pay Capital One regularly (e.g. 1/week) to keep balances low.
Open trade terms with your major suppliers and don’t use credit cards.
Not all of our managers are adept at financial management, organization, or even math, so all AP processing is done from corporate. Also it is good to keep separation between those who order and pay for some sense of fraud control. Of course we have to call the local manager to verify if work was done.
Additionally, if you open something like the Lowes LAR account, the buyer at the store must provide a PO number and name, which appears on your monthly invoice. An example PO number for us would be “Home52Carpet.” You get all the detail monthly from Lowes corporate showing the date, location, buyer name, PO number, description, etc. on a professional monthly statement, which is much better than scores of hand scanned receipts coming in every day of the month.
You said you already have a Spark business card, this is what we use as well. With the 2% cash back.
Indeed you will take a hit to your credit score, but you should be able to pull it into the 750+ range with regular payments, which should be in the top credit bracket for any purpose you might wish to use it for. Also with your increased gross (business) income, continually increase your credit limit so that your usage relative to your limit is lowered.
But seriously, if you have all of these credit card expenses, you are in fact greater credit risk and you are not going to be in the 800+ range anymore.
mhpcommunity, I am glad that you asked that because I don’t know. We have relied on option 2 & 3 of what I suggested. However, I do want to get a DUNS number from Dun & Bradstreet, so I went to their website today and applied. To get a basic credit account with a DUNS number is free. The website says the upgrade service is $229 or $999 depending on the features. I went with free for now.