As a business owner, one of your goals is to grow your company. To reach this goal, you may need financing at some point. If you have less than perfect credit, your options become limited. Whether you’re looking to obtain a small business loan from a bank or you’re gunning for an alternative option, there’s a good chance that your credit score will come into play. That number not only determines whether or not you qualify but your rates and term options as well.
Bad credit doesn’t have to be forever. With these credit repair tips, you can boost your score and improve your odds of getting the financing you need for your business goals.
Know Where You Stand
When it comes to credit repair, one of the first things you need to do is know where you stand. Request a copy of your credit reports and spend some time going over them. Dispute any incorrect information you find, even if it’s a slight misspelling of your name. Even minor issues can affect your overall credit score.
Pay All Bills On Time
Another critical step in the credit repair journey is paying all of your bills on time. Your payment history makes up a good portion of your score, so any late or missing payments can have devastating effects. Make it a habit to pay your bills on a set date or set up autopay so that you never miss a due date. Remember, however, if you set up automatic payments, you’ll want to ensure that you always have the funds in your account to cover them.
Reduce Your Financial Obligations
Look for ways to reduce your expenses. Operating lean can help you save money and pay off your existing debts more easily. Take a look at all of your business expenses and see where you can make cuts. Some options to consider include using free apps instead of paid versions, downsizing, and hiring freelancers on an as-needed basis rather than bringing on full-time employees.
Be Smart with Credit Cards
Credit cards can be a great asset for improving your credit score. They can also be a detriment if you’re not careful. Avoid accumulating new cards to shuffle existing debt. Instead, focus on paying off what you already have. If you do use a credit card for any business purchases, be sure to pay it off promptly to avoid accruing too much interest and accumulating even more debt.
Credit repair isn’t difficult, but it does take some time and effort. When you take the time to improve your credit score, you widen your financing prospects and make it easier to qualify for the types you need.