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business credit??? North Carolina

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  • business credit??? North Carolina

    I am currently getting started on a business plan for my new diner. My husbands credit is not good. My personal credit is good. I live in North Carolina and state law says my husbands and my credit count as one. Is there any way I can legally separate my husbands credit from mine for the purpose of financing my own business? Also, would a DBA or LLC suit best for this type of financial plan? I'm still pretty ignorant on such things and researching my self to death right now! Thanks for any advice.

  • #2
    I can't answer your first question about whether you can separate your credit rating from your husband's, but keep in mind that a rating is just a tool that lenders use to help them determine whether or not to make a loan. If you are a good risk and can explain to a lender why your husband's credit rating is not relevant to your loan, you may overcome the problem with your husband's bad credit.

    As for whether you should use a DBA or an LLC, I think you are really asking the wrong question. For a diner, I don't think any knowledgeable attorney would recommend that you conduct business as a sole proprietor, which is all that a "DBA" is - you doing business under an assumed name. A sole proprietorship offers you NO protection from the liabilities of the business.

    Your question should be LLC or corporation? Both offer you some degree of protection from liabilities of the business. There are many factors to consider. Neither is necessarily "right" or "best" - it just depends upon which factors are most important to you.

    For more information, see How to Form a North Carolina Limited Liability Company.

    Good luck and feel free to post follow-up questions.
    David K. Staub (
    Forum posts are not legal advice, are for informational and educational purposes only, and are not a substitute for proper consultation with legal counsel.