Wednesday, August 27, 2014

Two Tricks to Improve Business Credit!

Obtaining financing is hard. It doesn’t matter what your credit score is, new businesses often are faced with ‘no’ after ‘no’ when first starting out. If you have a less than stellar credit score, obtaining credit is going to be even harder.

I have some sure fire ways to make improving your credit- or lack thereof- easier in business. First, know that 35% of your credit score relies upon your timeliness of payments. If you have a new business with no credit, obtain a pre-paid credit card. Make and then payoff (and on time) small purchases every month. If you have poor credit, this simple tactic is the quickest way to jump your credit score.

If you do have a great personal credit score but a poor business credit score, don’t cojoin the two. Keep these two entities separate, after all- they are separate entities. While cosigning for your business may help your business obtain a better APR, your personal score will suffer and this isn’t a good thing.

My second tip is to check each statement you receive yourself. You can’t rely on your accounting people to take good care of your company’s credit- or build it up. You need to look at every paid, pending, and outstanding invoice on a monthly basis. You need to examine monthly bank statements. You need to examine payroll. It is up to you to verify numbers and transactions. Accounting people can help you navigate your finances but it is up to you to ensure accountability and authenticity in every transaction.

Until tomorrow,

Twyla N. Garrett

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