Finding the capital to keep a business afloat is a challenge many small business owners face. A staggering 33 percent of these companies need more funds to continue operating, but one of the best ways to combat a lack of capital is business credit cards and loans. Securing a loan for your business is much like securing one to purchase a home or car.
Your business credit score ranges will provide lenders with information to determine fair terms and interest rates for your company. A score in the ideal business credit score range will help you secure better terms for your small business.
The good news is that you’re in the perfect spot to learn more about credit reports and business finances. Continue reading to boost your business credit score today!
What Is a Business Credit Score?
Most consumers are familiar with personal credit scores, and business credit scores are similar in some regards. Instead of a scale ranging from 300 to 850, business credit scores can be from zero to 100. The minimum ideal business credit score is 75, but it’s better to aim higher.
Lenders and the Small Business Administration lean heavily on your business credit scores when assessing you for a loan. It’s best to have a business credit score range between 80 and 100 to increase your approval odds. You’re more likely to receive the best Business credit cards to build our brand into an industry power.
Factors Impacting Credit Reports
Your business’s longevity plays a significant role in determining your credit score. Having a company that has operated for several months or years will aid you in securing the business finances you need.
Your credit score is also affected by your business revenue. Bringing in more money annually pushes your credit score higher.
The assets owned by your company also increase your credit score. Consider any vehicles or properties your brand owns when applying for business credit cards.
Outstanding debts will harm your credit score when building business credibility. Look at the current loans and credit cards you’re using to finance your business. Using a credit card responsibly and making payments on your debts is the best way to borrow money and maintain a strong credit score.
Lenders will also use your personal credit history when determining the risk of lending to you. A solid personal credit score will help you improve the odds of securing financing. Lenders want to see a history that indicates you pay off the loans you take out.
Find the Best Business Credit Score Range
The ideal business credit card range is between 80 and 100, with 100 being the best score possible. A higher business credit score will help you secure better loan terms and gain access to business credit cards.
Your credit score is affected by the longevity and revenues of your business. Lenders will also consider your credit history and any existing debts your company has.
Securing cash flow and using business loans and credit cards is crucial to get your brand off the ground. Read more of our Technology and Marketing articles to gain the knowledge and advice to build a successful brand today!
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