Update: We have updated the Ink card details to reflect the current offers
TravelSort reader Jennifer writes “I've been thinking of applying for an Ink business card, but have a couple questions. First, can I get one even though I don't have an official business? My husband and I are planning to fix up a place and rent it out, but we haven't rented it out yet. Second, which Ink card should I get? I'm confused because there are four of them!”
Great questions Jennifer–it can be somewhat confusing given that there are four different Ink business cards from Chase. To address your first question, you're definitely eligible for an Ink small business card. Here are a few pointers.
Are You Eligible for an Ink Small Business Card?
- You do NOT need to have an incorporated business to apply for a small business card; you can apply with your Social Security Number as a sole proprietor, using your own name
- You do NOT need to have started your business yet. Most businesses have a planning and preparation stage, and it makes sense to want to separate out business planning and preparation expenses for tax purposes.
- You do NOT need revenue. Be honest in the application: if you haven't started the business yet or have but haven't yet made any revenue, put $0 revenue. You can explain on the call with Chase business lending services that you're still planning/just started the business, etc.
- Many activities count as small business. A few examples:
- Renting another house or apartment, or renting out your own residence or a room in your house or apartment
- Consulting services: if anyone pays you for anything, from freelance writing to tax preparation to Web site design to personal shopping, that's a small business
- Selling items on eBay, Amazon, at craft fairs, or even garage sales
- Blog or Web site, if you plan to monetize it (even if you don't currently make money from it)
Which Ink Card?
Ink Bold Business Card
= charge card: You must pay it off in full every month. Annual fee of $95 is waived the first year, you earn Ultimate Rewards points that transfer 1:1 to United, Hyatt, Korean Air, Southwest, Marriott, and other partners. Up to $50,000 in annual spend can receive the 5X bonus, for spend on Internet, cable, phone services, spend at office supply stores. Signup bonus: 50,000 points
= credit card: You could carry a balance (but shouldn't, since it would negate the points earned). Otherwise the same as the Ink Bold.
= no annual fee credit card, limited to $25,000 in annual spend that can receive the 5X bonus, must have Sapphire Preferred, Ink Bold or Ink Plus to transfer points out to Ultimate Rewards airline and hotel partners.
Ink Cash = don't bother, if you want to earn transferable points for travel; earns cash rewards only.
Which Ink Card Offer?
- 50,000 points after spending $5,000 in 3 months
- Best for most, as you receive 50,000 bonus points and spend just $2000 more than the Ink Classic offer
- 20,000 points after spending $3000 in 3 months
- Best for those that can only meet the lower $3000 spend requirement or only want a no annual fee card (although note that both the Ink Bold Business Card and Ink Plus waive the annual fee for the first year)
I'm assuming Jennifer and her husband will be able to put significant spend on their new Ink card for their business and perhaps also in 5X categories, so I'd recommend the Ink Bold Business Card
with 50,000 points after $5000 spend in 3 months. By going with the Ink Bold, there won't be a preset credit limit, but charges do need to be paid off in full every month.
Some prefer the Ink Plus
, because of the introductory 0% APR for the first 6 months, which allows you to increase the time you have to meet the minimum spend for the bonus (do make sure you make the minimum payments during this time and can pay off all your spend before the 6 months are up).
Advantages of a Business Card, Especially If You'll Be Applying for a Mortgage or Refinancing
Jennifer didn't mention whether or not she'll be seeking a refinancing of the place she and her husband will be fixing up and renting out, but if she is, it's important to have as high a credit score as possible. Normally I'd recommend not applying for any credit cards at all during the 6 months prior to a mortgage, refinancing or other major loan.
That said, the advantage of business credit cards is that your credit line and your utilization of it are NOT reported to the credit rating agencies the way they are with personal credit cards. As we noted in Understand Your Credit Score and How it Works to Maximize Credit Card Rewards
, Utilization and Outstanding Debt comprise 30% of your credit score, vs. only 10% for credit requests.
To put this in simpler terms, with a personal credit card such as the Sapphire Preferred, you can't just focus on paying off your bill in full every month; if you really want to maximize your credit score, you need to worry about paying off any significant purchases as you incur them. So if your credit limit is $20,000 and you had a $7000 purchase, you'd want to pay that off right away, not wait for the statement due date.
With a business card, it doesn't matter, as long as you're paying in full by statement due date, since business credit card utilization isn't reported to the credit agencies at all. So this is another great advantage of having business credit cards, in addition of course to the 5X category bonuses and no foreign transaction fees for the Ink Bold and Ink Plus. And now with AMEX Bluebird you can even earn points when paying business rent and other expenses you previously paid by check. You may not be able to find Vanilla reloads any longer at Office Depot, but you still have the option of either buying reloads from drugstores that carry them (1 point per $1 is still better than no points for expenses you normally pay by check) or buying Visa gift cards for 5X to use for credit transactions you would normally not earn bonus points on.