Business Credit Report 101
Just like your personal credit report, your company’s credit report is very important to keep track of and maintain at a high level. If you have a high business credit score, it will open doors to better opportunities for your company. For example, you may find more lenders willing to offer loans to your company, allowing you to pick and choose the best option for you instead of being stuck with whoever is willing to help you. However, maintaining the credit for your business works a little different than your personal credit.
There are some major differences between your business and personal credit scores. For example, where a personal score ranges from 300 to 850, a business score ranges from 0 to 100. The best way to build the score is to make on-time payments. Standardization is another key difference; business credit score algorithms don’t follow an industry standard as personal does, so they will vary from bureau to bureau.
Another large difference is that you cannot get a free credit report for your business if you want to get it from the major credit bureaus. These three are Dun & Bradstreet, Experian and Equifax. This is different from personal credit scores, which you can generally find for free from online sources that track credit. Your information is public when it comes to your credit for your business, which is another way that it varies from personal.
Since each major company for tracking business credit scores works a little differently, it is important to know what each company is looking at when determining your score. This way, you will be able to do better with improving all three scores, which will give you a higher chance of benefits such as lower insurance premiums, lower interest rates on loans and larger loan amounts offered. Once you know how the scores are calculated, you can find out your score by going to the websites and paying for a credit report. This is recommended at least once a year so that you know where you stand, because you may be doing better or worse with your credit than you realized.
Being aware of your business credit score is one of the major things you can do for your company to get better business opportunities. These opportunities can make a large difference in your ability to operate successfully and grow, so this is nothing to just ignore. Get started on tracking and improving your score today.