Your dreams of business ownership, a nice office and great equipment can all be tied to your business credit. Having a bad credit score is not only detrimental to being able to afford loans on the things you want to buy, but also can affect the job that you are able to get. Read the tips below for ways that you can repair your credit if necessary and keep it good if it already is.
The minimum credit card payment is not all you can pay, try to pay over that amount. Paying higher than the minimum payments looks excellent on a credit report and will contribute to a higher FICO score. It also helps your finances by lowering the amount of interest you are paying which will save you money.
Keep your business credit card balances low. having a high credit limit on your card can seem like you’ve won the lottery, but using that entire limit will lower your score. Try to keep balances at a 50% maximum. 30% is more of a prime target. By doing this you are showing that you can handle your business credit well, and that you don’t need every dollar that has been extended to you.
Keep your first account open. Whatever credit account you have had open the longest, is the best one to keep on your report. Don’t close this account because the limit is too low or the rate is too high. Try to get a higher credit limit, or ask for a lower interest rate, but even if they won’t give that to you, keep the card and keep using it. The longer track record you have with an account, the more it will affect your score in a positive way.
To have a better business credit report, pay your bills as quickly as possible. Create a schedule of your monthly payments and stick to it. Your debt will not keep on growing and your report will not contain any late payments. Late payments is something banks and financing agencies look at when granting you a loan.
Report good information to credit agencies to help increase your score. If you have a job that is not listed, have it added to show job stability and increased income. If you owe taxes and have paid them on time, have that information added as well, to show that you do have the ability to pay debts.
With the new business credit card laws in place, banks must now decline your card in the event of a possible overdraft. They will most likely try to get you to opt out of this, claiming that it is a service they provide to approve the purchase anyways, and then charge you a small fee. These fees are high. You will be much better off getting declined and using a different bank account or credit card for your purchase, than paying their fees.
An important tip to consider when working to repair your business credit is to pay your bills on time. This is one of the most important steps for maintaining good credit and preventing your score from dropping. Bad marks for past due accounts will stay on your account for five to seven years.
Not having a good business credit score, or not having any commercial credit at all can seriously impact the life that you live. So much of what we do relies on credit. We need it to buy a car, a house or even have a credit card. This article has shown you how to manage your credit in a way that you will be able to enjoy all of these things.