business credit

Factors affecting your business credit

You need to know what makes up the business credit score and what gives you a good chance to get a business loan. There are factors which come into play as far as your business credit is concerned. Below are some of these factors and how you to make the most of them.

Blanket UCC filings

Most people do not realize that they should pay attention to the order they get some loans and the UCC filings thecreditreport lender files. Some lenders can file blanket UCC fillings which implies they have an interest in all your assets. Such blankets will take precedence over any subsequent blankets, and this reduces your ability to get credit elsewhere drastically. Ensure that you plan your credit carefully then negotiate UCC filling depending on your needs. For instance, if you need a given asset to be excluded from the UCC filing to use as security for a different loan then you can explain in advance so that those assets are excluded from the blanket fillings. You can also choose to get an account with more specific UCC filing first. Other experts advise that you open accounts that have competing UCC filing at the same time then negotiate the details with the parties simultaneously.

Payment history

Your payment history is a crucial part of your business credit profile and what you D&G paydex score is based on. Most credit opportunities come with a minimum paydex requirement. To improve your score ensure you pay your vendors early or on time.

Credit applications

Multiple credit applications can be a red flag and will keep you from getting approval for a loan. Too many loans in a short time make your company look desperate, and this becomes a sign to potential lenders that you are going downhill. You should plan your credit use properly and keep applications to the minimum possible to accomplish your goals.

Company legal structure

The legal structure of your company may affect your business credit. Lenders are not likely to loan money to sole proprietors than to corporations or limited companies. You should ensure your company is incorporated so that you improve your ability to get credit.

Company financial status

financial statusWith D&B it is usually important to ensure your financial status in the credit file are up-to-date. If they are not, it can negatively reflect on the company when the lender compares the available data. You need to update the financial status on your credit report so that they reflect your current circumstances and do periodic planning.

These are some of the factors that affect your business credit and how you can fix them to ensure to improve your ability to get credits.…