7/7/2023 0 Comments Credit score range scaleWhat’s more, with a good business credit score a lender or vendor may not require a personal guarantee, which means they won’t be able to go after your personal assets if you default or miss a payment. If you can’t get business financing, you’ll have to rely on personal savings, a personal credit card, home equity or another method of financing. Having a good business credit score makes it easier to get business financing. Why Is a Business Credit Score Important? The only requirement is that the business has suppliers, vendors and lenders who regularly report account activity to a business credit bureau. When a business owner needs to take out a loan or open a line of credit, the lender or service provider will typically check both their personal and business credit score to determine their eligibility.Īny type of business can have a business credit score, from a sole proprietorship to a corporation with thousands of employees. A business credit score functions the same way. When a consumer applies for credit, the lender will pull their credit score to determine if they’re a responsible borrower. We’ll take a look at how a business credit score is constructed, the importance of a high score and what you can do to make sure your business has a strong credit profile. While a business credit score is similar to a personal credit score, there are some key differences in how the score is put together. What you might not realize is that businesses need to do the same. As a consumer, you’re likely familiar with the importance of building and maintaining a good personal credit score.
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