Finance & Lending

 

02 18 2015

Business Credit Reports

02 18 2015

Boosting Your Credit As A Small Business Owner

An individual’s credit score can impact nearly every part of their financial life, from accessing small business working capital to securing a home. However, credit can be even more important for a business itself. Fortunately, there are strategies owners can use to boost their business credit scores and make operations that much easier.

Importance of a business credit score

First, most small business owners will likely want to keep business and personal finances separate. While your business will be intrinsically linked to your income, you don’t want things like business debt obligations to affect your personal credit or that of your partner. If the worst should occur and your business fails, you may find yourself having to declare personal bankruptcy if your finances aren’t separated.

Additionally, obtaining larger business loans will be far easier if your enterprise has a credit profile of its own. A high personal credit score will help you access smaller loans, but oftentimes a business will require larger options.

Also, just like with personal credit scores, the healthier your business credit profile is, the easier it will be to obtain funds with favorable rates and terms, as well as more affordable insurance coverage.

Improving your business credit score

The first step for small business owners looking to boost their scores should be analyzing their business credit report to ensure there are no inaccuracies.

“There’s only one way to improve your score quickly, and that’s if there’s untrue negative information,” Liz Weston, author of “Your Credit Score, Your Money & What’s at Stake,” told Entreprenuer. “If you have somebody else’s account showing up on your credit report and you get that taken off, for instance, you’re likely to see a quick improvement in your scores. Other than that, it’s really a game of small improvements over time.”

As far as what small improvements will enhance a business credit score, the most important is paying creditors on time. Making timely payments in full will show credit rating agencies, and potential lenders, that a business is trustworthy and financially stable.

It’s also helpful to understand how business credit scores are calculated. Factors such as outstanding balances, payment habits, how credit is utilized and years on file all play a role.

For instance, since credit utilization can impact scores, it’s smart strategy for a business owner to open new business lines of credit if they don’t have any or only have a minimal amount. Having multiple credit accounts that are paid off regularly can help improve scores.

Options for businesses with poor credit

Even owners with the best intentions may find their business sporting bad credit scores at some point. While this is definitely something business owners should try to avoid, it’s not the end of the world as far as accessing funding is concerned.

There are special bad credit small business loans available for businesses to utilize. These loans typically put less focus on FICO scores in favor of other financial attributes.

Find Out How Much Funding You Qualify For

Fields marked with an * are required
By clicking this button I agree to all terms and conditions.

Terms & Conditions

General Acceptance

Any applications submitted electronically shall have the same force and effect as if the application bore an inked original signature(s). The above information, together with any accompanying financial statements, schedules, or other materials, is submitted for the purpose of obtaining credit and is warranted to be true, correct, and complete.

 

US Patriot Act:

To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person and business that seeks a business loan.  What this means for you: When you apply for a loan, we will ask for your business name, address, and Tax Identification Number.  We will also ask for your name, address, date of birth, and other information that will allow us to identify you.  We may also ask to see your driver’s license or other identifying documents.

 

For Loan/Merchant Services:

The Merchant and Owner(s)/Officer(s) identified in the application (individually, an “Applicant”) each represents, acknowledges and agrees that (1) all information and documents provided to National Funding, Inc. (“NF”) including credit card processor statements are true, accurate and complete, (2) Applicant will immediately notify NF of any change in such information or financial condition, (3) Applicant authorizes NF to disclose all information and documents that NF may obtain including credit reports to other persons or entities (collectively, “Assignees”) that may be involved with or acquire commercial loans having daily repayment features and/or Merchant Cash Advance transactions, including without limitation the application therefor (collectively, “Transactions”) and each Assignee is authorized to use such information and documents, and share such information and documents with other Assignees, in connection with potential Transactions, (4) each Assignee will rely upon the accuracy and completeness of such information and documents, (5) NF, Assignees, and each of their representatives, successors, assigns and designees (collectively, “Recipients”) are authorized to request and receive any investigative reports, credit reports, statements from creditors or financial institutions, verification of information, or any other information that a Recipient deems necessary, (6) Applicant waives and releases any claims against Recipients and any information-providers arising from any act or omission relating to the requesting, receiving or release of information, and (7) each Owner/Officer represents that he or she is authorized to sign this form on behalf of Merchant.(8) I consent to receive direct mail, faxes, and e-mails sent by National Funding and its affiliates for the purposes of transmitting account updates, requests for information and notices, and (9) this request is for business and not for consumer purposes.

 

For Equipment Services:

I hereby certify: (1) the information provided is true and correct, (2) you are hereby authorized to investigate all bank, credit, and trade references, and said references are hereby authorized to release any requested information to you or your nominee, (3) such authorization shall extend to obtaining personal credit profile in considering this application and subsequently for the purposes of update, renewal or extension of such credit or additional credit and for reviewing or collecting the resulting account, (4) this information may be transmitted by us to you and by you to underwriter(s) for the purpose of granting me credit, either electronically or manually, and that by submitting this application, I take full responsibility for transmission thereof, (5) I am over 18 years of age, (6) I acknowledge my rights under the Fair Credit Reporting Act, (7) I consent to receive direct mail, faxes, and e-mails sent by National Funding and its affiliates for the purposes of transmitting account updates, requests for information and notices, and (8) this request is for business and not for consumer purposes.

The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status or age (provided the applicant has the capacity to enter into the binding contract); because all or part of the applicant’s income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. If for any reason your application for business credit is denied, you have the right to a written statement of the specific reasons for the denial. To obtain the statement, please write to National Funding Inc., 9820 Towne Centre Drive, San Diego, California 92121.  Funding amount and credit approval is subject to a full credit profile review.