Introduction
As a business owner, understanding your business credit score is vital to the success of your company. Your business credit score influences many aspects of your business, including your ability to secure loans, credit terms, and better vendor or supplier relationships. In this article, we will provide a step-by-step guide to checking your business credit score, top-rated credit score checkers, a comprehensive checklist to ensure successful credit score checks, and strategies to strengthen your credit score.
A Step-by-Step Guide to Checking Your Business Credit Score
Your business credit score is affected by several factors, including payment history, credit utilization, and the length of credit history. A strong business credit score increases your chances of obtaining loans and favorable credit terms. Here are some steps to follow when checking your business credit score:
- Get your business credit report
- Review your credit report for errors
- Track your business credit score
- Improve your credit score
The first step is to get your business credit report. You can get your reports from various credit reporting agencies, including Experian, Dun & Bradstreet, and Equifax. Contact the agencies to obtain your credit report or go to their website to request a copy of your report.
Once you have your credit report, review it for accuracy. Confirm all the information and look out for errors like the misspelling of your company name, misreported data, and false trade lines. Errors adversely affect your business credit score, so it’s crucial to get them corrected as soon as you notice them.
Most credit agencies will provide you with ongoing credit monitoring services to track your credit score and alert you of any changes or fraudulent activities. It’s an excellent way of keeping an eye on your credit score without checking it manually every time.
Suppose you note any errors or inaccuracies. In that case, you should dispute any negative information reported to the credit agencies, contact your creditors to make payment arrangements, and work with vendors or suppliers who report to credit agencies to improve your credit score.
Checking your business credit score regularly and disputing any errors is one way to improve your credit score and improve your chances of getting favorable credit terms.
The Top 5 Business Credit Score Checkers You Need to Know About
The following are the top-rated credit score checking services for businesses:
1. Experian Business Credit Reports
Experian provides business credit reports and scores that range from 0-100, with scores above 75 rated excellent. Their reports are available in real-time and include current credit information, collection information, and industry-specific scores.
2. Dun & Bradstreet
Dun & Bradstreet provides Delinquency Predictor Scores, which predict the likelihood of business delinquency and failure. Businesses are rated on a scale from 1-5, with 5 being the highest risk and 1 being the lowest.
3. CreditSafe
CreditSafe provides in-depth credit reports on businesses, including credit scores, judgments, liens, and collections reports. They also offer alerts on any changes or updates to the credit report.
4. Equifax Business Credit Reports
Equifax provides businesses with credit scores and reports, including payment histories, credit utilization, and past due amounts. They offer different monitoring packages to track the credit score depending on the business needs.
5. Nav
Nav offers a range of small business credit solutions, including free and paid business credit reports. The free reports include credit summaries from various credit bureaus, while paid reporting options provide more detailed credit information for a monthly fee.
Why Checking Your Business Credit Score Regularly is Critical
Checking your business credit score regularly is crucial to your business success due to its direct impact on your loan eligibility and credit terms. Failure to monitor your business credit score can result in less favorable loan terms, higher interest rates, and difficulty obtaining credit for your business. Business owners should check their credit score regularly, especially when preparing to apply for business financing.
The Ultimate Business Credit Score Checklist
Here is the ultimate business credit score checklist that business owners can follow:
- Get your free credit report annually from each of the reputable credit agencies
- Review your report and look for any inaccuracies or errors that could minimize your business credit score
- Dispute any incorrect information with the appropriate credit reporting agency
- Make timely payments to your creditors as late payments can hurt your credit score
- Monitor your credit report for any fraudulent activity, such as identity theft
By following this checklist, business owners can ensure successful credit score checks and maintain a strong business credit score.
How to Improve Your Business Credit Score
If your business credit score needs improvement, there are several strategies you can employ to raise your score:
- Reduce debt: Pay off your existing debts to reduce your credit utilization rate, which will positively impact your credit score.
- Keep your credit accounts open for long periods: The length of your credit history is a significant factor in your business credit score. Long-standing accounts with positive payment histories positively affect your score.
- Maintain good relationships with vendors or suppliers: Poor payment histories with your vendors or suppliers can harm your credit score, while favorable payment terms strengthen your credit score.
Employing these strategies can help you improve your business credit score and increase access to business financing.
Conclusion
Checking and monitoring your business credit score regularly is critical to your business’s success. This comprehensive guide has provided insight into how to check your business credit score, top-rated credit score checkers, a checklist to ensure successful credit score checks, and strategies to strengthen your business credit score. By following this guide, you can improve your business credit score and increase access to business financing and better vendor and supplier relationships.