Dun & Bradstreet, Experian and Equifax create their own commercial credit scores. Some lenders and sellers may also use specialized business credit reports when evaluating their business. That’s why you want to make sure you try to work with lenders who report to credit offices.
You are guaranteed to receive a free copy of your personal credit reports from the three major consumer credit offices once a year, but the same guarantee does not apply to commercial credit reports. For small business owners or sole proprietors who wish to check their corporate credit information, alternative services may have free options to help you obtain information about your business credit profile. Once you have prepared a business credit file, make sure you do your bit to build your credit history. When you apply for credit or business loans, lenders and card issuers will review your payment history in time, how much credit you have available compared to how much you have used, and your profile and business credit score.
In addition, we discuss how to build your corporate credit and how to verify your credit score with a variety of free business credit reports. Even a derogatory element in your business credit reports can cause you to be refused loans and credit cards. For example, if you apply for the SBA loan program 7, the SBA will analyze one of your company’s credit scores, your FICO SBSS score, to qualify you for the loan. Although your personal credit score and business credit score are business credit report separate, your personal credit score will also play a role in your ability to receive credit products as loans to small businesses. Therefore, in addition to paying a lot of attention to your credit score, you want to regularly check your personal credit score, pay your personal credit card and other debts on time and generally show a stable personal financial history. As with consumer credit scores, competing agencies create and sell different commercial credit scores.
When applying for a credit or loan for a small business as the sole owner, lenders are likely to analyze your personal credit history. Essentially, lenders as individuals will ask you for a personal guarantee that you will pay the money. This can result in a thorough consultation of your personal credit report, which can affect your credit score.
These are accounts with which companies can later buy and pay goods or services, for example with net repayment terms of 10 or after 30 days. Utility accounts, which traditionally do not appear in consumer credit reports, may appear in small business credit reports. Once you have created your business audit account, you can request a corporate credit card that is reported to commercial credit offices. By making regular timely payments to providers who report to commercial credit offices, you can start building and maintaining a good commercial credit score.