A business credit score is a number that tells lenders how reliable your business is when it comes to paying back borrowed money on time and in full. The higher your score, the better. While it’s definitely possible to get a loan with a lower credit score, you pose less risk to lenders if your score is good or excellent. Additionally, as your score increases, you’ll be able to ask for larger financial loans, which would really help your business grow. So how do you improve your business credit score?
Tips for Businesses Looking to Improve Their Credit Score
Business credit scores are similar in many ways to personal credit scores. Consequently, in order to improve your business credit score, you can simply practice the same self-control and responsibility that you should with your personal credit score. Here are some tips:
• Borrow manageable amounts of money or use a credit card to make purchases that you know you can pay off on time. Then pay the balance or loan off promptly to avoid fees or the temptation to borrow more than you should.
• If you’re currently in debt, work on paying that debt off as quickly as possible to create a positive mark on your business’ credit record. Set reasonable goals and come up with a monthly payment that you will be able to stick with. You can even set up auto-pay so that you never forget to make a payment.
• Make sure you pay your bills on time. Set a reminder on your phone for several days before the bill is actually due and pay it ahead of time. This gives the payment a few days to process, ensuring your payment isn’t late.
• Double-check that your credit report is correct. If you see anything that isn’t right, call the company and get it straightened out. Every positive incident and every negative incident influences your business’ credit report.