You Can’t Do Without Business Credit

As an entrepreneur, there may be many aspects of a business that you can do without but business loan is not one of them. Building business credit is the need of the hour for any business, whether it is new or old.

Don’t!

In the long run, one needs to know how to establish corporate credit. More often than not, this process takes many years in the making. The need of the hour is to understand the difference between business & personal credit. This will help to separate the two from each other.

A credit report is a statement that stands for a person or a business’s ability to make good on a debt. While starting out on a new business, most entrepreneurs commit a very basic error. They confuse their business expenses with their personal expenses. This might not be a problem when one needs to spend a few thousand dollars and dips into his or her personal credit for the money. The problem arises when the need for money and credit increases and begins to negatively affect your personal credit.

Statistics show that of all the new upstart businesses, only 10% make it through the first 5 years. These are the businesses that have concentrated on the creation and maintenance of a good business loan profile. In cases where this was not done, entrepreneurs ended up with no businesses and no personal guarantee worth its salt either.

Truth behind Business Credit

Unlimited business credit can be available to you as long as you know how to capitalize on the knowledge you have of business credit. For gaining an understanding of small business loans, there are a few factual bits of information that you need to have.

The first is about the business credit bureaus. These are the bureaus that give you the business credit scores. Dun & Bradstreet, Experian & Equifax Businesses and last but not the least in any way, Business Credit USA are the ones that you need to be well versed with. These bureaus evaluate your credit profile, if and only if you give them the information by submission of your set of data and credit grantor’s information. This has to a voluntary process. Not many businesses, however old they might be know this and this is the unfortunate reason why they lack any kind of credit.

As compared to the personal credit scores, business credit scores are evaluated on a lower scale of 0 to 100 with 75 being a good score. Most businesses that intend to build a strong business profile aim at scoring 80 and higher.

Seek Attention

It is not essential that you try to build your business credit scores all by yourself. You may go ahead and hire help for you to do so in the form of credit building services. The one great advantage of this is that your business will be able to earn business credit is a much lesser amount of time as compared to your laboring away on your own.