Where to get your business credit report
Dun & Bradstreet®
Dun & Bradstreet uses payment history, outstanding balances, business transactions, and more data to calculate a series of business credit scores and ratings. Business partners, like potential lenders and creditors, can get a glimpse into the ﬁnancial health of your company by checking your D&B business credit file. NOTE: These scores and ratings can ﬂuctuate often, changing based on your ﬁnancial activity.
Your credit score from Equifax is calculated based on FICO® Score 8 model. Your lender or insurer may use a different FICO® Score than FICO® Score 8, or another type of credit score altogether. Results may vary. Some may not see improved scores or approval odds.
Not all lenders use Experian credit files, and not all lenders use scores impacted by Experian BoostTM. Your credit score is calculated from the information found in your credit report including payment history, amount of debt, credit history length, amount of new credit, and credit mix.
CreditSafe generates a business credit report as a free trial. The length of your free trial is determined when a CreditSafe.com company representative calls to set you up. After you access the free trial, you have the option to subscribe to three different packages depending on your business needs.
CreditSignal provides companies with free access to changes in their Dun & Bradstreet® credit scores and ratings. CreditSignal also provides information and advice about how to interpret and manage your scores.
Nav Credit Monitoring®
“In a short period, I have gone from a business with no rating to an A rated company. I could not have done it without the tools provided by Nav.”
This is just one of the many positive reviews about Nav’s credit services. Their free service is a good fit for anyone who wants a basic overview of their business credit life.
- Personal credit score and summary report from Experian
- Letter grades and reports for your business from Experian and Dun & Bradstreet
- Tools to build business credit
- Personalized financing matches
- 24/7 monitoring and alerts
Another helpful feature is the ability to view your personal and business credit scores side by side so you can discover where your credit needs work and what to do next.
How to establish business credit
Consider these tips to help establish business credit. Don’t “set it and forget it”! Be sure to monitor your credit activity regularly and address any problems pronto:
Apply for a business credit card
Business cards typically carry credit limits of $50,000 or more. This makes it much easier to purchase high dollar goods and services that you need to run your business efficiently. Using a business credit card responsibly can boost your credit rating. Note that a business credit card stands alone. Your personal credit rating is not impacted by your business transactions. A business credit card also helps you control employee spending and track business expenses. Bonus: Many business credit cards have great perks.
Work with vendors that report payments and pay them early
Vendor accounts that report to business credit reporting agencies will help your business build business credit. A vendor can be any business – look into where you get your office supplies, inventory, and other outside products or services.
It makes it easier to create a business credit file when you form a separate legal entity for your company like an LLC or corporation. This move also makes it easier to qualify for business financing and may also provide tax advantages and can protect you from personal liability you might have as a sole proprietor.
Separate business and personal expenses
They always say don’t mix business with pleasure and in this case business owners should avoid mixing their personal and business finances. This is something you should be doing from the get-go. If you haven’t already, make clear definitions between your personal and business finances with separate accounts, this will give you a better vision on what you are spending and where.
Get an employer identification number (EIN)
If bringing on employees, you need to register for an employer identification number (EIN). An EIN is a nine-digit number assigned by the IRS used to identify the tax accounts of employers (and certain others who have no employees). The IRS uses the number to identify taxpayers who are required to file various business tax returns. Apply for an EIN on the IRS website.
Open a business banking account
According to the SBA, as soon as you start accepting or spending money as your business, you should open a business bank account. Common business accounts include a checking account, savings account, credit card account, and a merchant services account. Merchant services accounts allow you to accept credit and debit card transactions from your customers. You can open a business bank account once you’ve gotten your federal EIN.
Establish a business address and phone number
It’s important to establish your business with an address and phone number. Here are some guidelines:
How to get a physical address for your business
- Get a P.O. Box from the United States Postal Service
- Get a Mailbox Through the UPS Store
- Use the Address of a Co-Working Space
- Get a Virtual Business Address
Keep business information current with the bureaus
Each business credit bureau collects different information and has unique scoring models. Different suppliers and different lenders report different kinds of data. Because a lender or supplier could pull your business credit report from any or all of the main bureaus, it’s important that you are maintaining all three.
You are allowed to update basic information about your business like employee number and years of business. A complete profile is the best practice to keep information current.
Calculating Overall Business Health
Do you want an overall picture of the financial health of your business beyond your business credit score? This knowledge is particularly important if you’re seeking low cost funds for working capital, debt refinance or for a commercial real estate purchase or refinance.
Business owners may not realize that banks calculate several metrics, not just personal credit and business credit. Those metrics include combined debt coverage, business debt coverage, business debt usage, personal debt usage and business revenue trends.
It may sound daunting to calculate each but you don’t need advanced accounting skills. SmartBiz® has a free tool, SmartBiz Advisor, that calculates these metrics and generates your “Loan Ready Score”.
This score can tell you where you stand if you’re seeking an SBA loan with low rates and long terms, a bank term loan, or another custom financing solution. Sign up today, free of charge, here: Welcome to SmartBiz Advisor.