While many small business owners and start-up businesses rely on personal credit for initial financing and use personal assets like homes for collateral, it is a good idea to establish a business credit score as quickly as possible to limit personal exposure.
Business credit scores are an important tool most small business lending companies use to decide whether or not you will get the loan you need. In fact, the Small Business Administration (SBA), banks, suppliers and other business lenders rely heavily on business credit scores and FICO scores when providing lines of credit or extended payment terms.
Establishing good business credit scores is important because:
Small business lenders rely on business credit scores from multiple credit rating agencies to decide whether or not to make loans to small businesses. The three main business credit bureaus in the U.S. are Dun & Bradstreet, Equifax Small Business and Experian Business.
Just like with personal credit, your business credit score stays with you forever. Missing payments or taking on too much debt is a red flag to the rating agencies and prospective lenders. Business credit scores range from zero to 100 with small business lending companies often requiring a minimum business credit score of 75.
If you need to improve your business credit, THD Credit can help by digging into the details of the report, disputing inaccuracies, updating incomplete details and negotiating the removal of negative marks.
Don’t let your business credit report keep your business from thriving. If you have any questions or would like us to help with your business credit report call us at (800) 822-7120.