If your company always pays the account on time or early, your business credit score may improve. Once a creditor reports an account to a business credit bureau, it should appear on your associated business credit report. ![]() (Some accounts might appear on both types of credit reports, depending on lender credit reporting policies.) However, your consumer credit reports and business credit reports remain separate from each other. It’s worth noting that Experian and Equifax are also consumer credit reporting agencies. When your company opens a credit obligation in its name, the creditor may report the account to one or more of the business credit reporting agencies-Dun & Bradstreet (D&B), Experian and Equifax. How Does Business Credit Work?īusiness credit is similar to personal credit in several ways. In such scenarios, paying a business credit obligation late might damage both your personal and business credit scores. It’s not unusual for commercial lenders and business credit card companies to require personal guarantees from business owners. Business credit reports contain details about debts in your company’s name and the payment history on those accounts (on-time, late, etc.).Īlthough your business and personal credit reports are separate, small business owners need to proceed with caution where business credit obligations are concerned. Personal credit reports contain information about how you manage credit obligations that you take out in your own name under your Social Security number. However, your business credit and personal credit are separate. Other business scores may analyze how likely your company is to default on its credit obligations.īoth business credit and personal credit can help lenders, insurance providers and others evaluate risk. ![]() For example, some business credit scores may predict the likelihood that your business will fail. These evaluate the information found on your business credit reports and predict future financial performance. This information can show others how you have managed commercial credit obligations in the past. These contain your company’s credit history. The business credit umbrella involves two terms: On National Funding's Website What Is Business Credit?īusiness credit is a term that describes several tools lenders, creditors and vendors use to measure the creditworthiness of your business.
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