One of the most crucial concern while starting a new business is the building credits for the company. If you plan to achieve this using traditional business practices, it could take up to many years. However, if you are not willing to spend years gaining credibility for the company, you must consider purchasing an aged company instead of starting a new company.
Notably, the shelf corporations are the companies that are formed administratively and put on the shelf for many years to the age, and they do not have any active business operation. These are created solely with the purpose of selling in the future.
Shelf corporations are an excellent means to access commercial credits like credit lines and loans without spending the time establishing the business credit profile in the traditional manner, and these also help the people who do not want a personal guarantee for the business financing.
Why is it good to purchase the shelf companies?
- Purchasing an aged corporation is indeed a faster process compared to starting a new company or business from scratch. In the case of the aged company, all the work is already completed, and you need to transfer the rights and the documents, which ultimately saves a lot of time and resources.
- Talking about the second most important feature of the shelf company, i.e., credibility, an aged corporation often has more credibility than a new company or start-up.
How can shelf corporations have more credibility than the new businesses?
- The patrons often recognize the name, and they are already much familiar with the company, which makes them trust more for the company.
- The creditors or the lenders are inclined to loan the money to the aged companies because they are established enough to have excellent corporate credit standing. On the contrary, it is pretty tricky for any new business to arrange loans or funds.
How can a shelf corporation help you to get business loans?
The age of the company is the foremost thing to provide credibility for the lenders and the customers. It works primarily if the length of the time for which the person is in business equals the company’s age. These companies come with established credit lines, which can help your company a substantial financial boost. Definitely age of the company is not the sole criterion for the company’s credibility, but indeed is a very crucial factor for the same.
There are many shelf companies available for you to get, including Nevada corporations, Wyoming corporations, and Canadian corporations. These aged companies already have corporate credit scores and an established relationship with the lenders.
Things to consider before purchasing the shelf company
You must consider few essential things before purchasing an aged company. At very first, you need to check the reason for which the company was made. It becomes important because knowing the cause will let you know whether the company has some negative associations and liabilities. You aim to influence the potential investor by acquiring the shelf company, so you need to be sure to check every aspect of it.
Another crucial thing to consider is the cost of the company. It is evident that the cost will be according to the company’s age, i.e., more established is the corporation; more costly it will be. It is better to make sure that the price range you are spending must be according to your purchase. Notably, any aged company with all the documents completed will charge you more than the company with minimum documentation and information.