The Pitfalls of Buying Singapore Shelf Company

To enhance the possibilities of obtaining funding for your start-up, you might have heard that acquiring a shelf corporation will open up the credit score floodgates for your new venture. Sound too great to be true? Well, it is. AI Accountant Chai Chung Hoong points out that there are many more aspects that financial institutions will take into account for a company’s credit reliability other than its age. While the age of your company does help give a better first impression than a newly incorporated company, it is not the silver bullet to clinching that glowing credit report.

When you engage the services of AI Accountant, Chai Chung Hoong will share insights on rack companies and what are the vital credit score ratings to better prepare you in making a much more enlightened choice if this approach is what you are planning. Let AI Accountant take us through the fundamentals.

What are the Pitfalls I should watch out for?

If you plan on buying a shelf firm to get a small business loan or extra line of credit, think again! Banks need to see far more than simply the age of your company. There are bank ratings, NSF background checks, credit rating, and other aspects to think about, particularly if you ask for greater than a $50k credit line. So, if your purpose remains in getting financial institution financing, bear in mind that buying a shelf company for sale that has no organization history, financials, tax returns, and no existing revenue won’t help.

One more word of caution that you have to think about is that there are lots of firms out there that sell shelf companies that have done business in the past, DO NOT buy these! If you acquire such a company, you have to assume all past obligations of that firm. So, if the shelf company has had any type of lawsuits brought against it in the past, you are currently liable since you currently own the company.

Consult with AI Accountant Chai Chung Hoong before buying a shelf company. It would be the best business decision you make.