Corporate credit is only attainable when your business actively meets its financial obligations leading to banks developing a credit score for them. How’re that many sellers online portray that a shelf corporation comes with an existing line of credit?
The short answer is that many sellers try to scam you and extort money out of you by giving you a false image. Typically, shelf corporations don’t come with existing lines of credit. In this blog, we further clarify why you should avoid shelf corporations with an existing line of credit.
Shelf corporations or aged shelf corporations are entities that are created for the mere purpose of being shelved. There are no business operations carried out, and so the corporation ages until a business owner comes along and shows interest in buying it.
Since there are no business activities present in shelf corporations, they don’t have any means of acquiring finances or being scored for credit. This means that there’s a possibility of existing lines of credit.
Therefore, one should always be wary of catchy phrases they see across the internet when sellers offer credit lines with shelf corporations. These are typically present to lure you into spending an exuberant amount of money for no reason.
Two major risks exist when it comes to buying from vendors that showcase that a shelf corporation has an existing line of credit.
The biggest risk of falling into this trap is that most of these sellers provide you with false, fraudulent, or misrepresented information. There’s a risk that these shelf corporations come with a myriad of liabilities instead of credit lines. And so, if you purchase them, the burden of the liability shifts to you.
Another plausible risk is that they don’t have any existing lines of credit. The vendor can easily fool you into paying a high price while promising immediate funding through these credit lines.
A note to remember: Aged shelf corporations never promise immediate financing. Other factors go into whether your corporation receives funding or not, such as the industry of your business, your credit score, and more.
Don’t waste your money on shady and unregulated shelf corporations. Instead, go for cleaner options that offer you aged shelf corporations. You can differentiate between these easily as they don’t promise a myriad of existing assets, credit lines, or guaranteed financing.
Corporations4Less offers you aged shelf corporations that are free from assets and liabilities unless stated otherwise. Our services promise authenticity and ensure safe company incorporation for you. We also offer LLC company registrations and company incorporation services.
Our aged shelf corporations are available across the US, including Texas, Pennsylvania, Florida, and more. Reach out to us for a detailed analysis of your credit report for the best possible aged shelf corporation recommendation.