This may sound surprising, but if you are in business, a separate business address is of great importance and helps you in many ways. First, it increases your credibility because a company with a shared or no address looks suspicious. Marketers and business owners will not believe such businesses.
Also, it helps you build business credit and obtain funds, loans, etc. Here’s how the business addresses influence credit decisions.
A business address can influence credit decisions
Many of you may not know it, but creditors always consider business addresses before deciding. Regardless of where your business is located, they will look at whether or not you exist.
You can make your home address and business address the same. In this case, they will ask you some questions to confirm. Once they are satisfied, they will begin the process. Although there is no harm in keeping your home and business addresses the same, having a separate business address will help you get the loan quickly.
Which is more helpful – virtual or physical business address?
It depends on the credit provider. Many credit providers do not accept virtual business addresses because they can be created by anyone and are unreliable. However, most lenders will consider physical business addresses, such as post office box numbers or your office address with street number, where you can receive mail physically.
So if you want to build your business credit, you must choose your credit provider wisely. Also, you should consistently maintain your business address and include it the same on all official documents, as this will increase your credibility. So, choosing the correct business address is also important because it will help you make no or fewer mistakes, and you don’t need to change it repeatedly.
Is a business mailing address enough to build Business Credit?
Your business credit depends on your business address, which of course, starts with your business name. So always make sure you choose a business name that is not risky.
Usually, lenders check your business name and address before making a decision, and they never invest in a risky business name. So, please choose the business name without specifying the type of business. For example, you can select “Jane’s” instead of “Jane’s Gas Station”.
Also, your mailing address would be a business address rather than a P.O. Box number or a home address. Credit providers prefer physical addresses with a street number, most likely your office address, as this increases your credibility.
Most lenders will reject your application simply because it does not include an actual street address.
Drawbacks of using Personal Address as a Business Address
In most cases, business owners use their personal address as a business address, which is not bad. However, there are some disadvantages to using your personal address as a business address.
First, using a personal address as a business address will affect your privacy. However, nowadays, it is possible to find anyone’s address, but it is still helpful to keep the addresses separate.
Also, most businesses require business meetings, and a separate office will make a big impression on your clients, as no meetings can take place at a kitchen table.
So, keeping your two addresses separate will allow you to expand, add value, increase your credibility, and build your business credit more effectively.
Can virtual business addresses work?
It’s difficult for remote business owners to have a separate business address because they usually work from home. However, they can use virtual addresses as their physical business address. This way, they don’t have to use their home address.
A virtual business address has the same value as the actual mailing address. With a virtual business address, you have access to a virtual mailbox. This is basically a real mailbox at an exact location that is not a post office.
Moreover, virtual business addresses along with mailboxes are more beneficial as they are accessible for both work and meeting rooms. Now you don’t have to hold meetings at your workplace even though you don’t have your own office.
Besides, with a virtual business address, you can receive all confidential files and packages more securely and have them guarded 24/7. It looks more professional and helps you build your business credit more efficiently.
Some virtual business spaces also offer reception and messaging services, which is beneficial if you need someone to take calls and messages for you.
The only problem with virtual business addresses is requiring a registered agent. Otherwise, they would be useless and would not contribute to business credit.
When it comes to business loans, your business address is of great importance as it helps lenders and loan providers verify the identity of your business. So, if you provide a separate business address with accurate details, you can build a better credit score that will eventually help you get more customers.