Whether you have just started a business, or you have been running one for a while, you will want to make sure that you are managing your business credit score correctly. There are a few different tips that you can use to help make sure that you are not making any mistakes. The main thing that you need to focus on is maintaining a good utilization rate. You want to make sure that you are using no more than 30 percent of your credit limit. The next thing that you should be sure to do is to pay your bills on time.
Pay early
Taking the time to pay your bills on time is a good way to improve your business credit score. It can also help you form relationships with suppliers and vendors. These relationships can eventually lead to more 
favorable payment terms.
Making a payment in a timely manner is the most important thing to do in this regard. You’ll want to avoid making late payments, especially when it comes to business credit cards. This is because missed payments can harm your business’ credit score, which can make it difficult to obtain loans in the future.
Other than paying your bills on time, there are other things you can do to improve your business credit score. For example, refinancing your business loans is a great way to lower your payments and make them more manageable. You may also want to consider a debt consolidation loan.
Establish credit
Whether you’re a new business or an established company, it’s important to establish a credit score for your business. A good business credit score can help you secure loans, contracts, and insurance. You may even be able to negotiate favorable terms for products and services.
One of the best ways to build a business credit score is to open a business credit card. When you pay off your card bills on time, your score will improve. Also, keep your financial records separate from your 
personal finances.
You should also keep a separate business phone number. This number should be listed in your directory assistance. You should also have a professional email address. Having a professional email address can help you maintain a good business reputation.
Another important step in building a business credit score is to ask your vendors to report your payment history. The information you provide can be weighted in multiple business credit scores.
Keep credit utilization below 30 percent
Keeping credit utilization below 30% is a good rule of thumb to get a decent credit score. It’s a rule that can be applied to individual credit cards and also to your overall credit score. It’s a good idea to call your 
credit card issuer to see if they can help you keep your credit utilization low.
It’s also a good idea to check your credit score online for free. This can be done on sites like WalletHub. It offers a free credit report and free score, along with other credit management tools.
Another tip is to pay off your credit cards. It will improve your credit score and may also help you obtain larger loans, such as a home loan. Paying off a big purchase early will lower your balance and show up as $0 on your next statement.
The 30-percent rule of thumb is a useful metric to use, but it isn’t the be all and end all of credit scoring.
Correct errors on business credit
Having errors on your business credit report can be harmful to your business’s reputation. Even if you’ve had a successful business, errors on your report can make it seem less trustworthy and credible. They can also prevent you from obtaining financing for your business. You can correct errors on your business credit report and repair your credit, but it can be a bit tricky.
The Fair Credit Reporting Act states that consumers have the right to dispute inaccurate information on their credit report. In many cases, disputes are resolved within 30 days. If you’re unsure about your rights, you can contact your credit bureau directly to learn more.
If you’re having trouble contacting your credit bureau, you can use the Experian dispute resolution process. This involves reviewing your business credit report and submitting an online form. If you believe that there are errors, you’ll need to provide supporting documents.
FAQ
Frequently Asked Questions
How to get your business credit score?
There are many credit-scoring agencies that offer free credit evaluations. The most well-known is FICO, which is owned by the Fair Isaac Corporation. Your business credit score is a numerical representation of your creditworthiness. Factors that contribute to a high credit score include timely payments, low debt levels, and a good credit history. A low credit score can indicate a higher risk of default on loans or credit cards.
To obtain your business credit score, you can follow these steps:
- Check with Credit Bureaus: Contact major business credit bureaus such as Dun & Bradstreet, Experian Business, and Equifax Business. These bureaus collect and provide information on business credit.
- Establish a Business Credit Profile: Ensure your business has a separate legal entity and obtain an Employer Identification Number (EIN). Open a business bank account and use it for all business transactions to establish a clear separation between personal and business finances.
- Build Business Credit History: Make timely payments to your vendors and suppliers. Establish trade credit relationships and ask them to report your payment history to business credit bureaus. This helps build a positive credit history.
- Monitor Your Business Credit Report: Regularly check your business credit report for accuracy. Look for any discrepancies or errors and report them to the credit bureau for correction.
- Apply for Business Credit: Apply for business credit cards or small business loans. Ensure that the creditors report your credit activity to the business credit bureaus. Responsible and timely use of credit will positively impact your business credit score.
- Pay Bills on Time: Timely payment of bills and credit obligations is crucial for a good business credit score. Late payments can negatively impact your score.
- Manage Your Debt: Keep your business debt at manageable levels. High levels of debt relative to your credit limits can adversely affect your credit score.
- Maintain a Good Financial Position: Demonstrating financial stability and responsible financial management will contribute positively to your business credit score.
Remember that building and improving a business credit score takes time. Regularly monitoring and managing your business credit profile is essential for maintaining a healthy credit score.
How to build business credit score?
To build a good business credit score, you’ll need to have a strong credit history and maintain good credit habits. You can improve your credit score by paying your bills on time, using a credit counseling service, and avoiding credit utilization (using your credit cards too much). You can also get help from a credit rating agency to improve your credit score.
There is no single answer to this question as it depends on the specifics of your business and credit history. However, a good place to start is by contacting a credit bureau or credit counseling service to get your credit score and credit report reviewed. This will help you identify any issues with your credit history and make improvements if necessary. Additionally, you can use credit monitoring services to keep an eye on your credit score and make sure that it stays high.
Building a business credit score is important for establishing your business’s creditworthiness. Here are steps you can take to build and improve your business credit score:
- Establish a Legal Business Entity: Ensure that your business is legally recognized as a separate entity. This may involve registering your business as a corporation, LLC, or other legal structure. This separation is crucial for distinguishing personal and business finances.
- Obtain an Employer Identification Number (EIN): Obtain an EIN from the IRS for your business. This unique identifier is similar to a Social Security number for your business and is necessary for opening business bank accounts and establishing credit.
- Open a Business Bank Account: Open a dedicated business bank account in your business’s name. Use this account for all business transactions to create a clear separation between personal and business finances.
- Register with Business Credit Bureaus: Register your business with major business credit bureaus such as Dun & Bradstreet, Experian Business, and Equifax Business. This step is essential for the bureaus to start collecting and reporting information about your business’s credit history.
- Establish Trade Credit Relationships: Work with vendors, suppliers, and other business partners who are willing to extend trade credit to your business. Request that these creditors report your payment history to business credit bureaus. Positive trade credit relationships can have a significant impact on your business credit score.
- Apply for a Business Credit Card: Apply for a business credit card and use it responsibly. Make timely payments and keep your credit utilization low. Ensure that the credit card issuer reports your activity to business credit bureaus.
- Pay Bills on Time: Timely payment of bills and credit obligations is crucial for building a positive credit history. Late payments can negatively impact your business credit score.
- Monitor Your Business Credit Report: Regularly check your business credit report for accuracy. Ensure that all information is up-to-date and report any discrepancies to the credit bureaus for correction.
- Gradually Apply for Additional Credit: As your business credit history builds, consider applying for additional forms of credit such as business loans or lines of credit. Responsible use of credit and consistent, on-time payments will contribute to a stronger credit profile.
- Diversify Credit Types: Diversify the types of credit your business uses. This can include trade credit, credit cards, and other forms of financing. Having a mix of credit types can positively impact your credit score.
- Maintain a Positive Financial Position: Demonstrate financial stability and responsible financial management. Lenders and credit bureaus assess your business’s overall financial health when determining creditworthiness.
Building business credit is a gradual process, and it requires consistent effort and responsible financial management. By following these steps, you can establish a positive credit history for your business over time.
What is a great business credit score?
There is no one definitive answer to this question as it depends on a number of factors specific to your business, such as its revenue and credit history. Generally speaking, a high business credit score means that your company is likely to repay its debts on time and has a good credit history.
A great business credit score is typically one that is at the higher end of the scoring range used by the respective credit bureau. While the specific scoring ranges may vary between credit bureaus, a business credit score that is well above the threshold for being considered “good” is generally considered great.
Here’s a general overview based on common business credit bureaus:
- Dun & Bradstreet (D&B):
- A PAYDEX Score above 80 is considered good.
- A PAYDEX Score above 90 is often considered excellent or great.
- Experian Business:
- An Intelliscore Plus above 75 is considered good.
- An Intelliscore Plus above 80 or 85 may be considered excellent.
- Equifax Business:
- An Equifax Business Credit Risk Score above 80 is generally considered good.
- An Equifax Business Credit Risk Score above 90 or approaching the upper limit is considered excellent.
Keep in mind that these are general guidelines, and the definition of a “great” business credit score can vary. Achieving a great business credit score is beneficial for your business as it enhances your creditworthiness, increases the likelihood of favorable financing terms, and establishes trust with creditors, suppliers, and partners.
It’s advisable to regularly monitor your business credit score and take proactive steps to maintain or improve it over time. Responsible financial management, timely payments, and a positive credit history contribute to achieving and maintaining a great business credit score.
What credit score do you need for a small business loan?
The credit score needed for a small business loan can vary depending on the type of loan, the lender, and other factors. Different lenders have different criteria, and some may consider both personal and business credit scores. Here are some general guidelines:
- Small Business Administration (SBA) Loans:
- For SBA loans, lenders often consider both personal and business credit scores.
- A FICO SBSS (Small Business Scoring Service) score is commonly used, and a score above 140 is considered strong.
- A personal credit score above 680 is generally considered good for SBA loans.
- Traditional Bank Loans:
- Traditional banks may have higher credit score requirements.
- Business credit scores in the range of 660 to 720 or higher may be considered favorable by some banks.
- Personal credit scores above 700 may enhance your eligibility.
- Online and Alternative Lenders:
- Online lenders and alternative financing options may have more flexible credit score requirements.
- Some may accept credit scores as low as 500, but higher scores increase the likelihood of approval and better terms.
- Microloans:
- Microloan programs, often offered by nonprofit organizations or community lenders, may have lower credit score requirements.
- Credit scores in the range of 550 to 650 may be considered for microloans.
- Credit Unions:
- Credit unions may have varying credit score requirements for small business loans.
- A credit score above 650 is generally considered good for credit union loans.
It’s crucial to check with the specific lender to understand their credit score requirements for the type of small business loan you are seeking. Additionally, while credit scores are important, lenders also consider other factors such as the financial health of your business, revenue, time in business, and the purpose of the loan.
If your credit score is not within the preferred range, consider taking steps to improve it before applying for a small business loan. This may include making timely payments, reducing outstanding debt, and addressing any negative items on your credit report. Regularly monitoring your credit reports can help you stay informed about your creditworthiness.
How do i check my credit score for my business?
The best way to check your credit score for your business is to use a credit scoring agency such as TransUnion or Equifax. You can also check your credit report yourself through the three major credit bureaus.
To check your business credit score, you can follow these steps:
- Choose a Business Credit Bureau: Select a reputable business credit bureau. Major business credit bureaus include Dun & Bradstreet, Experian Business, and Equifax Business. Each may have its own scoring model, so it’s a good idea to check with multiple bureaus for a comprehensive view.
- Verify Business Information: Ensure that your business information is accurate and up-to-date with the credit bureau. This includes your business name, address, and other relevant details.
- Request a Business Credit Report: Contact the chosen business credit bureau and request a copy of your business credit report. You may need to provide information such as your business identification number (EIN), business name, and other details to verify your identity.
- Review Your Business Credit Report: Carefully review the information on your business credit report. Check for any errors, inaccuracies, or discrepancies. If you find any issues, report them to the credit bureau for correction.
- Understand Your Business Credit Score: Business credit scores typically range from 0 to 100, with higher scores indicating lower credit risk. Understand how your score is calculated and what factors contribute to it. Factors may include payment history, credit utilization, public records, and more.
- Monitor Regularly: Regularly monitor your business credit score. You may choose to set up alerts for any changes or updates to your credit report. This helps you stay informed about your business’s credit health.
- Take Steps to Improve: If your business credit score is not where you want it to be, take steps to improve it. This may involve making timely payments, reducing outstanding debt, and building positive credit history.
- Consider Credit Monitoring Services: Some credit bureaus offer credit monitoring services that provide ongoing monitoring of your business credit profile. These services may include alerts and additional insights into your credit health.
Remember that, like personal credit scores, building and maintaining a good business credit score takes time and consistent financial management. Regularly checking your business credit report allows you to address any issues promptly and make informed decisions about your business’s creditworthiness.
Whats a good business credit score?
There is no definitive answer to this question as it depends on a variety of factors, including your business’s credit history and current financial situation. However, a good business credit score typically ranges from 700 to 850, and would generally be good for obtaining financing and obtaining favorable terms on products and services.
Business credit scores typically range from 0 to 100, and what is considered a “good” score can vary between credit bureaus. Different credit bureaus may use different scoring models, but generally, a higher score indicates lower credit risk. Here’s a broad overview:
- Dun & Bradstreet (D&B):
- D&B PAYDEX Score: The PAYDEX Score ranges from 0 to 100.
- A score above 80 is generally considered good.
- Scores of 70 to 79 are considered fair, while scores below 70 may be seen as higher risk.
- Experian Business:
- Experian Intelliscore Plus: The Intelliscore Plus ranges from 1 to 100.
- A score above 75 is often considered good.
- Scores below 25 may be considered higher risk.
- Equifax Business:
- Equifax Business Credit Risk Score: The score ranges from 101 to 992.
- A score above 80 is generally considered good.
- Scores below 50 may indicate higher risk.
It’s important to note that these are general guidelines, and the interpretation of a “good” business credit score can vary depending on the specific scoring model used by each credit bureau. Additionally, individual lenders may have their own criteria for assessing creditworthiness.
Maintaining a good business credit score is crucial for accessing favorable financing terms, obtaining business loans, and establishing trust with suppliers and partners. Regularly monitoring your business credit report and taking steps to improve your creditworthiness can contribute to achieving and maintaining a good business credit score.
What does your credit score have to be for a business loan?
The credit score requirements for a business loan can vary depending on the lender, the type of loan, and other factors. Different lenders have different criteria, and some may place more emphasis on business credit scores while others consider personal credit scores as well. Here are some general guidelines:
- Small Business Administration (SBA) Loans:
- For SBA loans, lenders often look at both personal and business credit scores.
- A FICO SBSS (Small Business Scoring Service) score is commonly used, and a score above 140 is considered strong.
- Generally, a personal credit score above 680 is considered good for SBA loans.
- Traditional Bank Loans:
- Traditional banks may have higher credit score requirements.
- Business credit scores in the range of 660 to 720 or higher may be considered favorable by some banks.
- Online and Alternative Lenders:
- Online lenders and alternative financing options may have more flexible credit score requirements.
- Some may accept credit scores as low as 500, but higher scores increase the likelihood of approval and better terms.
- Credit Unions:
- Credit unions may offer business loans with varying credit score requirements.
- A credit score above 650 is generally considered good for credit union loans.
It’s important to note that credit scores are just one factor lenders consider when evaluating loan applications. Other factors such as the financial health of your business, revenue, time in business, and the purpose of the loan also play a role in the approval process.
Before applying for a business loan, it’s advisable to check with the specific lender to understand their credit score requirements. Additionally, taking steps to improve both personal and business credit scores can enhance your eligibility for favorable loan terms. Regularly monitoring your credit reports and addressing any issues can contribute to a stronger credit profile.
How can a business improve their credit score?
Improving a business credit score takes time and consistent effort. Here are steps a business can take to enhance its creditworthiness and improve its credit score:
- Check and Correct Information:
- Regularly check your business credit report from major credit bureaus (Dun & Bradstreet, Experian Business, Equifax Business).
- Ensure all information is accurate, and report any errors or discrepancies to the credit bureau for correction.
- Establish a Separate Business Entity:
- Ensure that your business has a separate legal entity, distinct from personal finances.
- Obtain an Employer Identification Number (EIN) from the IRS.
- Open a Business Bank Account:
- Open a dedicated business bank account in the business’s name.
- Use this account for all business transactions to establish clear separation between personal and business finances.
- Build Positive Trade Credit Relationships:
- Work with vendors and suppliers who report payment history to business credit bureaus.
- Make timely payments on trade credit accounts to establish positive credit history.
- Apply for a Business Credit Card:
- Apply for a business credit card and use it responsibly.
- Make on-time payments and keep credit utilization low.
- Make Timely Payments:
- Ensure all bills, loans, and credit obligations are paid on time.
- Late payments can have a negative impact on the credit score.
- Manage Debt Levels:
- Keep business debt at manageable levels.
- Avoid maxing out credit lines or exceeding credit limits.
- Diversify Credit Types:
- Have a mix of credit types, such as trade credit, credit cards, and term loans.
- Diversification can positively impact credit scores.
- Monitor Your Credit Score:
- Regularly monitor your business credit score to stay informed.
- Set up alerts for any changes or updates to your credit report.
- Negotiate with Creditors:
- If facing financial challenges, communicate with creditors.
- Negotiate payment plans or terms that can help avoid negative impacts on your credit score.
- Demonstrate Financial Stability:
- Maintain a positive financial position.
- Show evidence of stable revenue, profitability, and responsible financial management.
- Seek Professional Advice:
- Consult with financial advisors or credit professionals for guidance on improving your business credit.
Remember that improvements in business credit scores take time, and consistency is key. By taking these steps and demonstrating responsible financial behavior, a business can gradually build a positive credit history and improve its credit score.
Here are descriptions for some terms related to business credit scores:
- Business Credit Score: A numerical representation of a business’s creditworthiness, indicating its ability to manage and repay debts.
- Creditworthiness: The assessment of a business’s financial reliability and credit risk, often determined by factors such as payment history, debt levels, and overall financial health.
- Dun & Bradstreet (D&B): A major business credit bureau that provides business credit reports and scores, including the PAYDEX Score.
- Experian Business: A credit bureau that specializes in business credit information, offering credit reports and scores for businesses.
- Equifax Business: A credit bureau providing business credit information and scores, helping businesses assess their creditworthiness.
- PAYDEX Score: A business credit score provided by Dun & Bradstreet, indicating how promptly a business pays its bills.
- Intelliscore Plus: A business credit score provided by Experian Business, assessing a business’s credit risk based on various factors.
- Small Business Scoring Service (SBSS): A scoring model used for Small Business Administration (SBA) loans, considering both personal and business credit factors.
- Credit Report: A detailed record of a business’s credit history, including payment patterns, outstanding debts, and other relevant financial information.
- Credit History: A record of a business’s past borrowing and repayment activities, influencing its credit score and creditworthiness.
- Trade Credit: Credit extended by suppliers or vendors to a business for goods and services, impacting the business’s credit profile.
- Credit Utilization: The percentage of a business’s available credit that is currently being used, a factor influencing credit scores.
- Credit Monitoring: Ongoing observation of a business’s credit profile for changes, often facilitated through monitoring services provided by credit bureaus.
- Business Credit Card: A credit card specifically designed for business use, contributing to the establishment and improvement of business credit.
- EIN (Employer Identification Number): A unique identifier assigned by the IRS to businesses for tax purposes, often required for opening business accounts and building credit.
- Business Bank Account: A dedicated bank account for business transactions, essential for establishing financial separation and building credit.
- Business Financing: Various forms of funding and credit options available to businesses, impacting credit scores based on usage and repayment.
- Loan Eligibility: The likelihood of a business being approved for a loan, influenced by credit scores, financial health, and other factors.
- Credit Rating: A general assessment of a business’s creditworthiness, often expressed as a letter grade or numerical score.
- Financial Stability: The ability of a business to maintain a strong and secure financial position, a key factor in creditworthiness assessments.
These descriptions provide an overview of some terms related to business credit scores and credit management.