5 Ways Improving Your Credit Score Can Help Your Business
On an individual level, having a good credit score typically translates to lower interest rates on credit cards, mortgage loans and auto loans. This translates to a financial savings, especially when it comes to long-term loans like auto and home loans. The same is true when it comes to your business – good credit can be the lifeline to building a great company all while helping out your bottom line. Here’s a closer look at how having a good credit score can behoove your business:
5 Ways A Great Credit Score Helps Your Business
If your credit score isn’t up to snuff, here’s a look at why taking the credit repair steps to improve it can prove to be so valuable for your business:
1. Lower interest rates: Just as a higher score gets you lower interest rates on auto and home loans, it can get you lower interest rates on business loans as well. Improve your score today by making on time payments and keeping your credit utilization ratio at or under 30 percent.
2. Fast approval: When it comes to running a business, you usually can’t wait long periods of time for loans to be approved and funding to come through – you need it immediately to stay solvent. Good credit ensures faster approval compared to having shaky credit.
3. More options: In addition to fast loan approval and low interest rates, a good credit score will also mean you’ll have more borrowing options.
4. Groundwork for the future: It’s one thing to make on time payments and build positive credit history with a lender. It’s another thing to continue to build your credit score in other ways throughout the duration of the loan, something that can leave lenders with a very positive impression of your consumer behavior and overall operations. This goodwill can pay big dividends in the future when lenders recognize how reliable of a consumer you are. There’s a good chance that they won’t think twice when it comes to improving future loan applications.
5. Competitive advantage: We’ve already established how a good credit score can save you money on interest rates. And this money that is saved on financing can be utilized in a number of ways. For instance, you can pass the savings on to your customers to offer a less expensive product than your competitors. Or you could keep prices steady and improve your profit margins to expand and grow your company. That’s a choice for you to make, but it all starts with good business credit. If it’s not in good shape, make the steps to start improving it today.