Business Credit Report
Are you trying to secure financing for your small business? One document you need to pay attention to is a business report. The major credit bureaus that handle your personal credit, Experian, Equifax, and TransUnion, are all responsible for handling your business credit report as well. A business credit report allows lenders to see what type of financial obligations you have and if you are able to meet them in a timely manner.
What information is in a business report?
Similar to your personal credit report you can expect to see information that is sent in directly from your vendors and creditors. How often they report information is up to them as many of the vendors out there are very inconsistent with their reporting procedures. The information they report will have a direct impact on your business credit and will allow future lenders to quickly figure out if you are worthy of additional financing.
Why do we need business reports?
A business credit report is a waste of space to some people as they feel the success and growth of their small business should speak for itself. While you may be operating a successful company now, some of the decisions you have made in the past may hurt you. The purpose of a business credit report is to show lenders critical information about your company so they know who they are dealing with and if they are taking on a risky investment by lending you money. Some of the things lenders will review includes the following:
• Payment history. Have you defaulted on loans? Have you had any liens placed on your property? Have you struggled to make your monthly payment obligations?
• Erratic spending of credit cards
• Growth potential based on the debt to income ratio
Know your score
Whenever you are applying for any type of business financing, you need to know your credit score. Your business credit score is known as a PayDex score and it allows a lender to see what type of risk you are. Like your personal credit, you can improve your business credit with timely payments and by reducing your debt to income ratio. Check your business credit score often to make sure your image is not being tarnished in the industry. Check your business credit report for errors to make sure they are free from errors that can damage your ability to acquire a loan.
About the Author
Are you trying to secure financing for your small business? One document you need to pay attention to is a business credit report. http://www.corporatecreditconcepts.com/directory/business-credit-report.htmlRep
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