Think you aren’t eligible for a business credit card? Think again! This post tells how to qualify for business credit cards and why you absolutely should apply for them.
Note: I may receive a referral bonus if you apply for a credit card on any of the links provided below.
Why Should I Bother to Qualify for a Business Credit Card?
First, let’s address why you should bother to qualify for business credit cards. As I’ve covered in previous posts (Travel for Free in Six Easy Steps, My Free Travel Journey, and Why Travel Hacking Makes Sense), travel hacking is a very lucrative hobby. You can put your normal monthly expenses on a strategically chosen credit card. This allows you to earn points or miles that you can redeem for free travel. One of the absolute best ways to earn a lot of points all at once is applying for a new card. After you meet the required spend, you earn the bonus provided. For example, opening a Chase Sapphire Preferred credit card will currently give you 60,000 Chase Ultimate Rewards points after spending $4,000 on the card in the first three months.
Opening new personal credit cards is a quick and easy way to get a lot of points. And you can do this with a lot of different credit cards. But eventually, you will run afoul of the dreaded Chase 5/24 rule. Read more about this rule in my post Travel Hacking Mistakes to Avoid. I think Chase offers the best cards for travel hacking. Chase cards offer generous spending bonuses, and Chase Ultimate Rewards points are the easiest for beginners to use. But Chase will only approve you for new credit cards if you haven’t applied for more than 5 in any 24 month period. It’s pretty easy to apply for 5 credit cards in a 24 month period. This will limit your ability to earn additional Chase Ultimate Rewards points.
Chase Ink Business Cards
But even when you are over 5/24, you can still be approved for Chase business credit cards! Why is this? Because Chase business credit cards do not show up on your personal credit report, even if you use your own Social Security Number to apply for them! More on that below. So this opens the door for a lot of great spending bonuses on cards that do not count against you. The best of these cards is the Chase Ink Business Preferred card. If you can spend $8,000 in three months, you will earn 100,000 Ultimate Rewards Points.
If you are like me, $8,000 in three months is a bit too high. So I have opted to get both the Chase Ink Business Unlimited and the Chase Ink Business Cash cards. Currently, these give you 75,000 Ultimate Rewards points after spending a total of $6,000 in three months on each card.
Chase Southwest Credit Cards
One of the absolute best travel hacks out there is earning enough points to qualify for a Companion Pass on Southwest Airlines. A Companion Pass allows you to take one person on any Southwest flight with you free (except for taxes). To get a Companion Pass, you have to earn 135,000 Southwest Rapid Rewards points through flying or spending on a Southwest credit card. This is a lot of points!
But it’s relatively easy to do this if you can get both a Southwest personal credit card and a Southwest business card. For example, Southwest personal credit cards currently have a 50,000 points bonus after spending $1,000 in the first three months. Then you can get the Southwest Performance Business Credit Card with a 80,000 points bonus after a $5,000 spend. If you get both a personal and a business card, you have 130,000 bonus points + what you have spent on the card so far. This easily exceeds your 135,000 requirement to get a Companion Pass!
Convinced that You Should Qualify for Business Credit Cards?
I hope you are now convinced that applying for business credit cards is a worthwhile endeavor. But if you are anything like me, you may be thinking that you don’t qualify for a business card. I’m a busy mom of teens with a full-time job. I don’t have time for a side hustle! But then I realized that a small business can be literally anything that earns money. Here’s a list of things that people commonly do that could qualify as a small business:
- Selling stuff – garage sales or on online platforms like Facebook Marketplace
- Helping people – babysitting, lawn care, house-sitting, dog walking, etc.
- Freelance work – contracting your talents and expertise out to others
- Monetizing your hobbies – making crafts and selling them on Etsy, starting a blog or podcast, etc.
- Real estate – renting out homes or apartments
- And so many more! Here’s an article with a huge list of ideas!
I am occasionally paid to give a workshop or keynote address. I also have been blogging for years. Both of these activities help me qualify for business credit cards.
But I Really Don’t Make Any Money!
I work in education and give workshops to fellow educators. My honorarium for these rarely cover my expenses. And I’ve spent more money than I’ve made on my blog! But the only thing that matters is that I intend to make a profit on these activities. Intention to make money is the only requirement – you don’t have to have a specific business income threshold to apply. The credit card application will ask how much business income you make. You can put your actual income (even $0!), or you can project how much income you will make in the year you are applying for the card. I recommend projecting your income for the year, even if it’s only a small amount.
Do I Have to Do a Lot of Paperwork?
No – that’s the beauty of this! You can qualify for a business credit card using your own Social Security Number (SSN) and your own legal name as your business name. If you prefer, you can get a free Employee Identification Number (EIN) from the IRS.
Application Checklist
Here is everything you need to complete a business credit card application:
- Legal name of your business (can be your own name)
- Business name on card (you can name your business or just list your own name)
- If your business has another name or is Doing Business As (DBA) a particular name, provide that name.
- Business address & phone number (can also be your own)
- Business type such as incorporated, LLC, partnership, non-profit, or sole proprietorship (this is what you will choose if you are applying with your own SSN)
- Tax identification number (can be your SSN or EIN)
- Number of employees (list 1 if it’s only you)
- Annual business revenue/sales (can be $0 or projected income for the year)
- Years in business (list 1 if you are brand new)
- Industry/category/type of business (there is usually a pull down list to choose from – just select whatever seems to be the closet fit)
- Your title in your business (president, vice-president, treasurer, owner, member, or partner – select whatever seems to be the best fit)
- Total gross annual income (this can include your “real” job as well as the gross income of anyone living in your household)
Troubleshooting
Sometimes your business credit card application is approved immediately. That’s always a great feeling! But sometimes you will get a message that your application is being reviewed. This happened to me for my first business credit card application. I wondered what to do, but decided just to wait it out. Finally after about three weeks, I received an email that I was approved. I didn’t have to submit anything or talk to anyone. In some cases, you may be contacted by the credit card issuer. If this happens, they usually just want a bit more information about why you are applying for the card. Make sure you have thought about this! My answer to this question was that I was launching my business and about to have some business related expenses. I wanted to keep my personal and business expenses separate from the very beginning.
If you are denied, there are usually a couple of reasons for this. First, your credit score may not be high enough. The rule of thumb for business card application is 600 or higher. Fortunately, that’s an easy fix! This article has some great advice for increasing your credit score. Another reason may be that you applied for another credit card within 30 days. If this is the case, wait about a month and apply again.
If neither of these reasons apply, the credit card issuer probably just wants more information. You can call their reconsideration line and make your case with a representative. Here are the phone numbers for the major credit card banks:
- AMEX: 1-800-567-1083
- Chase 1: 1-888-270-2127
- Capitol One: 1-800-227-4825
- Citibank: 1-800-695-5171
Before you call, make sure you have prepared a reason that you are applying for the business card and have your financial information ready. Some things they may ask about are your rent/mortgage payment, reasons for other recent inquiries, and total household income. You may also want to set up an EIN in advance of this call to prove this is a legit business. They may ask about your business sales/profit. Be honest if it’s zero – everyone starts here!
Making the Spend
Congratulations! Hopefully easily, but maybe with a little more effort, you have gotten that shiny new business credit card! Now you may be wondering, how on earth do I make the bonus spending requirements if I don’t spend that much on my actual business? Relax. Focus first on meeting the minimum spend, no matter what expenses you use to do it. After that, though, set the card aside and use it ONLY for business expenses, or at least in categories where it is likely that a small business will spend money. Some examples include offices supply stores, internet/cable/phone services, gas, restaurants, advertising, shipping, travel, etc. It’s not illegal to use a business card for personal expenses, but it likely violates your terms of service, so tread cautiously.
Ready to qualify for business credit cards?
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