Stay on Top of Your Business Credit Score
Small business owners have to work hard at keeping their finances in order. When you are preoccupied with basic bookkeeping matters and trying to control costs, it is easy to lose sight of the importance of your business credit. Of course, meeting your financial obligations has a lot more immediacy than the consequences of how your financial activities are going to impact your creditworthiness. Nevertheless, you have to keep an eye on your business credit score in order to practice good money management and position your company for growth.
Mistakes on both consumer and business credit reports are surprisingly common. In the event that there is a mistake on your report, you want to catch that as soon as you have an opportunity to do so.
Fix Mistakes Before They Hurt Your Business
You certainly do not want to find out about a glaring error at a time when an inquiry on your credit is already underway. Financing providers and lending institutions have to interpret your score as it appears on its face, and your explanation that your report contains a mistake is going to offer little reassurance. Indeed, the mere fact that you were unaware of an inaccuracy on your credit report could give some potential creditors. Failing to monitor credit could indicate that you are not managing your finances attentively.
Regularly checking your business credit score gives you a chance to remedy errors before they become a problem for your business. The process of disputing a negative remark on your report with multiple credit reporting bureaus could take some time, so catching issues early could give you the time that you need to effectively resolve an issue.
Find Out About Fraud
Just like an individual, a business can become a victim of identity theft. Taking a look at your detailed credit report alerts you to any active tradelines that a third party has opened using your company’s information.
Track Your Progress
Building up your business’ credit can take some time, so periodically reviewing your score could offer you some insight into what credit-building tactics are producing positive results. Likewise, you can evaluate what areas are negatively affecting your score and what you need to work harder on.
Knowing where you stand enables you to make well-informed decisions about how you use credit to pay for overhead costs and grow your business. Ultimately, keeping tabs on your business credit score is an important part of monitoring your business’s overall financial health.