How Business Credit Affects Credit Scores
If you are in business, you have to know how your credit affects your credit scores. This is very important in order for you to know how your business is going. Since money is the entire bottom-line of business, you must know its flow. In your credit score, there are two inquiries that may appear such as the soft inquiry and the hard inquiry as well.
The first one is the so-called soft inquiry, which is considered the look at the credit report for purchase purposes.
This can be your personal or the employer’s inquiry to the credit score for the purpose of pre-approval. If you have the purpose of purchasing, then you need to have your hard inquiry. These two types of inquiries will appear on the credit score you have. Now, in case of the arousal of a rejection, your report will absolutely be affected. So, it is very important for you to report all your inquiries so that your business will not be in trouble in the future.
In business, you will be having several inquiries. All these inquiries are actually recorded on the credit report you have and even those inquiries that you asked yourself. Now, what if majority of the inquiries in your credit report are hard ones? The effect would be the belief of the potential lenders that you are planning to spend outside the current means. Bear in mind that this will not mean that you don’t have the authority to shop around for a certain loan anymore. All the inquiries that had showed up in the credit report will then be grouped into a hard inquiry.
Learn How Business Credit Affects Credit Scores
You must take note that all your inquiries must be reported so that you will be able to receive warnings beforehand if any person will intend to apply for a credit using your name. By receiving the credit reports in a regular basis, you can absolutely identify or spot if there is an unusual activity that is happening. Being subscribed to a credit monitoring program will also help you to keep track of your credit score without anyone to help you.
You also don’t need to worry about unauthorized individuals who can receive your very own credit information as an assurance from the Fair Credit Reporting Act that only the lawful business entities will be the ones to access the credit reports. Since the placement of the inquiries, they will remain on the report for two years. If there are inaccuracies you can dispute them. But without any hard proof that your report is correct, they will still not be removed.
Keeping an eye on your credit scores and reports is very essential. By getting more good credits, you can have several business benefits and advantages. This can also be the way on how you can make smooth sailing large purchases.
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