Saturday, March 20, 2010

Business Credit Report

Business credit reports contain information on a business's existing credit obligations, payment history, background history, and previous or existing legal filings. Such a record is typically an indicator of a company's financial health. Potential lenders look at business credit reports to determine if a company is able to handle further financial obligations such as loans. Of course, since a new, start-up company isn't established, a lender wouldn't be able to look over the business credit report. In this case, the financial history of the person or persons starting the company would be examined. Only companies that actually have a history of finances would have a company record available for evaluation. Either way, it is vital that potential company owners have both clean business and personal records.

Unfortunately, a company's success often weighs heavily on how much money is available for investing. A new and even an established company needs funds for a location, supplies, employees, equipment, marketing and products, especially when profits are slow. In these cases, borrowing is nearly an unavoidable necessity. In order to get loans, though, the company must be potentially or currently profitable in the eyes of the lender. Thus, banks will look at the business credit report to examine the past and determine the future of a company. If the business credit report shows consistent payments on previous loans, few legal issues, and a favorable balance between debt and profit, the lender is more likely to approve a loan. If, however, the company should fail to get a loan, there is hope. "I will abundantly bless her provision: I will satisfy her poor with bread" (Psalm 132:15). With faith and prayer, God will make a way if it is His will.

Business owners need to look over their business credit reports before the lenders do. Even before applying for loans, the business owner can go online and visit the websites for any of the major credit bureaus such as Experian or TransUnion. For a fee, these bureaus will provide the company owner with a copy of the business credit report. Should there be a large number of blemishes on the record, the company needs to clean them up as best as possible before applying for loans. Such a clean up can lead to lower interest rates and higher loan amounts. It may take some time and commitment, but a clean record will be well-worth the effort as the company works towards success.

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