Did you know that maintaining a good credit score does not only apply to you, but to businesses? A bad score makes it difficult for both people and businesses to seek out loans. Loans, in many cases, can be life-saving for businesses and people. Improving your credit score can save you, or your business, from missing out on a chance for a loan.
In this piece, not only will you find three ways to improve your number, but you will find out what a credit score is, why it is important to people and businesses, and what good credit scores are.
What is a Credit Score?
In order to understand how to maintain a good or better score, one must firstly remind themselves what a credit score is. Essentially, it is a three-digit number that represents our likelihood to pay back our debts. It’s no wonder that this directly affects our chances for a loan, as it gives the person or company (such as LendNesse) supplying the loan a good idea of our reliability.
Whether you are a potential homemaker using a loan to purchase a house or you are a business owner using a loan to purchase a place to conduct business, loans are vital. Loans create a solid, safe foundation for us to start from, but it is important to remember that these foundations are safe so long as we intend on paying back our loan. This is why loans and credit scores correlate; if one has a bad reputation of not paying back their debts, why would a loan holder want to risk them not paying back on their loan?
What is a Good Credit Score?
Typically, according to Experian, a person has a credit score between 600-750. This is a decent one, but in order for it to be considered “good,” a person would maintain a score above 700 or 800. For business scores, the range is typically 0-100, a good score ranging from 70-90.
There are many factors that affect it. Experian shares that late payments, the total amount of debt, bankruptcy, the number of inquiries for your credit report, and the number of credit accounts you have open all affect your score.
How to Improve Your Credit Score?
Improving your credit score is as simple as paying your bills on time. These bills can include rent, phone bills, television bills, and any type of loan. If remembering to pay bills is difficult for you, try leaving yourself notes where you’ll see them, or set up a reminder on your phone.
Some people believe that opening new credit accounts will help them. This is not true and is more likely to hurt your score than help it. Not only does owning more credit accounts make it more tempting to spend money and land yourself into more debt, but it will also create more inquiries on your credit report.
Some businesses will work with you despite your credit score. This doesn’t mean a bad one will land you funding, but with LendNesse, for example, you will find experts willing to help you find the best business credit funding to match your score. With twenty-five years of experience, this business can certainly help match your company to proper funding.
Conclusion
Loans are vital to helping a business flourish and a good credit score makes it easy to obtain them. The important thing to remember as a business or person is that you are the only one who can improve this score. You aren’t totally alone, however, as LendNesse has placed even the most “challenging” credit scores to funding. Even if your score isn’t good at the moment, using the tips mentioned can easily help you improve it to the point that you are applying to obtain loans.
