By establishing business credit, you are setting yourself up for success. Business credit protects your personal credit, helps you secure competitive loans, and can even help you attain better insurance rates. In this article, we’ll explain what exactly a business credit score is, the ways you can check it, and resources for the best credit repair packages.
What Is a Business Credit Score?
A business credit score is similar to a personal credit score, with a few key differences. A personal credit score is a three-digit number that suggests how reliable you are with credit to lenders. The higher the score, the better deals you may get with loans (lowered interests rates, higher loan amounts, etc).
Lenders and creditors will look at your business credit score to minimize risks when they offer you a loan (or check your business credit to see if they should loan to you at all). Here are a few key distinctions from how business and personal credit scores work:
- Personal credit scores are scored on a 300-to-850 scale, whereas business credit scores are rated on a 1-to-100 scale. For business credit, a score between 80 and 100 is considered strong.
- Creditors and lenders will track your business through your employer identification number (EIN), rather than your social security number.
- Your personal credit score is not public information, but your business credit score is. Anyone can look this information up.
- For personal credit scores, you can request a report from Experian, Equifax, or TransUnion. For business credit scores, there are several credit reporting agencies to pull from. The top three include Dun & Bradstreet, Equifax Business, and Experian Business. Unlike with personal credit scores, you may have to formally request one of these agencies to track you through an application process.
We recommend you establish a credit account for your business and register through a reputable credit reporting agency. This way, you can catch identity fraud, take out business loans at lower rates, and more–all of which far outweighs any credit repair costs.
How to Check Your Business Credit for Free
Unfortunately, many of the popular options for checking your business’s credit score come at a price: either a monthly fee or a one-time fee. If you’re just getting started and need more cost-effective options for monitoring your business’s credit, we recommend setting up a free trial with CreditSignal.
With a CreditSignal account, you can receive a monthly summary of charges to your business credit file. This summary includes other alerts and services, but does not grant you unlimited access to your report.
CreditSignal is a product through Dun & Bradstreet, and with a free trial, you can access full-service solutions that will help you monitor your business’s credit and grow your business. You can also access your Paydex score, another credit-monitoring and scoring option offered through Dun & Bradstreet.
Checking Business Credit for a Fee
Eventually, your free trial with CreditSignal will eventually pass. You can sign up for the full services after your trial with CreditSignal expires, and benefit from the full scope of services Dun & Bradstreet offers. There are also two other credible options: Equifax Business and Experian Business.
Equifax business provides you updates on your business’s score, as well as other services that can help you make business financing decisions. With a one-time fee, you can pull one Equifax report that allows you access to your Equifax Business Credit Risk score and your Equifax Business Failure Score. These scores are often pulled by lenders to evaluate your ability to repay loans or lines of credit relating to your business.
Experian Business operates similarly, and for a fee, you can pull one business credit report and see your business credit scores from Experian. You can opt for either a one-time report and scores for this fee, or you can subscribe to ongoing monitoring and access to your scores.
The Bottom Line
A business credit score can not only protect your personal credit and financing, but can also open doors for business opportunities and loans. To build credit on your business, you must apply through a reputable business credit reporting bureau. You can start a free trial to begin your journey, and subscribe to receive continued updates and monitoring of your business’s credit.
You want your business’ credit score to fall between 80 and 100, but if you fall short, it’s time to look into credit repair. The Phenix Group is one of the leading credit repair servicers that can analyze your credit and build a plan to repair your score.
Looking for more information about boosting your financial literacy, including whether or not you can use a credit card at an ATM? Check out our latest posts!