1. Acquire a shelf company from a
state that doesn't require a business license.
This is important in terms of choosing
a shelf company. A state that requires a business license also
requires disclosure of the owners. A change of ownership resets
the age of the shelf company to Zero; in the eyes of a bank or loan
The solution: Acquire the shelf
company from a state that doesn't require a business license, or
disclosure of the owners.
What states are best to locate a good
shelf company? The best shelf companies are found in Montana,
Wyoming and New Mexico.
2. After you acquire the shelf
company, then file for the Employer Identification Number (EIN), and
open the bank account.
Don't acquire a shelf company that has
established EIN. A shelf company may owe back taxes, credit card
bills, and other unseen obligations. For this reason, you should
acquire a shelf company that doesn't possess an assigned EIN or bank
Many shelf company providers sell shelf
companies with existing EIN's and/or bank accounts; and charge much
more. Please think this through. They are offering you a
shelf company that is sour with debts, potential tax liabilities, unpaid
taxes, unfiled returns, and other potential issues. You are much
better off acquiring a shelf company that has no EIN and no bank
3. Update the Secretary of
State where in the state where the shelf company was filed, and the
state in which you seek to do business.
This is critical. All information
on the state level, business licenses on your local level, , website,
and other public information must show a consistent address, and the
same principals, for your shelf company. Consistent information is
important to DNB and the banks.
4. File the shelf company in
your home state. If you live in California, file the shelf company
The banks want to see that you're doing
business in the same state in which you live. It's logical.
Anyone who purchases a shelf company from Wyoming, and lives in
California, will need to file the shelf company in California. The
banks seek to validate that you are where the shelf company is doing
business. Further, they seek to validate that the shelf company is where
you are. For these reasons, simply file the shelf company in the
state in which you live.
5. It's normal to buy an
established or existing business. If someone asks you if you
purchased a shelf company, tell them the truth. Tell them you
acquired an existing business.
6. The name of the shelf
company may involve most industries. At this time, banks are not
dealing fairly with any business seeking financing for real estate
If your shelf company name involves
words such as; real estate, realty, development, financial, or the like,
you are unlikely to obtain financing. Since banks lost so much
money on real estate and financial speculators, they are unlikely to
extend any credit to any business in those industries.
7. Don't change the name of
the shelf company. Instead, file the shelf company in the state in
which you seek to do business, and then file a Doing-Business-As(DBA).
Name changes reset the age of the shelf
company to zero; in the eyes of any finance company. A better
alternative is simply to file a DBA for the shelf company in the state
where you do business. In this way, you manage to do business
under the preferred name, and the age of the shelf company remains in
8. Obtain small loans and
accounts using your shelf company. Then pay off those obligations
early. The account will be reported to DNB and your shelf company
accumulated Paydex score is developed. An accumulated score of 80
is your goal.
9. After reaching an
accumulated Paydex score of 80 for about three to six months, then
you're ready to apply for financing.
Obtain a shelf company
from a state that requires a low annual filing fee to maintain
the company, respects your property rights, and doesn't require
disclosure of the owners of the company on public record.