• Are you looking for a business loan or financing? Been turned down?
  • Do you need a business line of credit for working capital or growth?
  • Do you want to lease or finance equipment for your business?
  • Would you like to stop having to personally guarantee every loan?

Financing is a critical part of growing a small business and almost always a very large concern for the owners. Nothing is more important and vital to the health of a small business than having the right financing in place.

Most small businesses are initially financed by the personal savings or assets of the owners, and can rapidly reach a stage of growth where they are forced to seek credit or investment solutions to fund that growth. Below, I am going to teach you how to build your business credit profile in order to assist you in obtaining the financing you need to grow and succeed.

Business owners quickly realize that applying for business funding is a much more complicated process than applying for personal credit. Applying for business funding requires careful preparation and demands that you understand the process and what it takes to qualify.

Why Do I Need A Business Credit Profile?
When you apply for business funding, funding sources will look at your personal credit and the business credit profile to determine: If they will approve your request, the amount, what the terms will be and if you will have to give a personal guarantee.

Example

Let’s say you have an "average" personal credit history (FICO score of 650) but no business credit profile. Based on your personal credit, you are approved for a business loan of $100,000 on terms of 13% interest over 10 years. If there had been a favorable business credit profile, the terms on the same loan might have been 7% interest over 10 years resulting in the savings of tens of thousands of dollars.

Here is what you could save by having a Favorable Business Credit Profile:

cd Un-Favorable or No Profile Favorable Credit Profile
Loan Amount $100,000 $100,000
Interest Rate 13% 7%
Term of Loan 10 years 10 years
Monthly Payment $1,493.11 $1,161.08
Total Payments $179,173.20 $139,329.60

Total Savings:      $39,843.60

Whatever your financing needs are, it is possible to obtain funding for your business. Poor credit, ok credit or good credit, getting the financing you’re looking for is a matter of knowing how to go about it and where to go. Building your business credit profile will improve your chances of success if you go about it in the right way.

 


 

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