How to Get a Business Credit Report and Stay On Top Of Your Scores
When you need to know how to get a business credit report, where do you turn? Do you know exactly how to easily request and check your business credit reports?
Your best choice as a business owner is to remain on top of your small business credit reports. These come from PAYDEX, Equifax, and Experian. There are three big credit reporting agencies for small business.
And you really should evaluate all three of them routinely. This is because they use marginally different criteria. Therefore moving the needle for one can move the needle for both of the others, although perhaps not as much.
Do not let your small business credit scores slide, as you have to catch any mistakes as quickly as you can. And locate anything which is dragging your scores down. And then take remedial steps.
You can get your reports easily. And stay right on top of all three scores by following a few basic steps.
How to Get a Business Credit Report and Check on Your Scores
Does your small business have a good business credit score? Are there any mistakes on it? You won’t know for sure until you know how to get a business credit report. And then you’ll need to start digging.
So you are presently in business, and you are striving to keep on top of your commercial credit scores. Or possibly you aren’t, and have decided now is a good time to start. Or maybe your company is somewhat new, and this is the very first time you’re doing this.
You Need to Be Doing This
Despite your situation, you have most likely asked this question at least once. Are my scores any good?
Let’s check out at the three company credit reporting agencies and solve this mystery at long last.
Keep your numbers in line and good things will happen. But you’ll never know your numbers are any good until you take action.
How to Get a Business Credit Report: Dun & Bradstreet (PAYDEX)
Dun & Bradstreet’s PAYDEX score of your small business can wind up being among the principal reasons that your company gets credit in any manner. D & B provides Credit Signal, which is a means to track your credit score by having the reports come straight to you, for a cost.
You may find the cost is well worth it to avoid the bothers that can arise from letting this score slip. And you would not have to develop and take care of the schedules and reminders you might need to stay up to date with if you don’t use it.
Don’t wish to use Credit Signal? Not to worry, as you can obtain your PAYDEX report through D & B and, if necessary, you can talk to their Customer Service department. So this department exists as a part of Dun & Bradstreet itself.
Plus, in order to review your PAYDEX report, check out what D & B provides, which is a sample report and even some higher level help in ways to read it.
Your Company’s PAYDEX Score
Dun & Bradstreet‘s PAYDEX score runs from 0 to 100. A PAYDEX score has a basis in payment details which is on report to the bureau. Or it is on report to data-gathering firms partnering with the CRA.
D & B uses this information, as well as a credit score and financial stress score, to recommend just how much credit a creditor should extend to your company.
Getting a PAYDEX Score
So as to have a PAYDEX number, you must file for a DUNS number via Dun & Bradstreet’s site. The number is free. In addition the credit reporting agency needs to have reports of your payments with four or more vendors.
Your small business’s PAYDEX score reveals if your payments are often made punctually or ahead of schedule. As you may expect, a higher number is better.
PAYDEX Score Details
The scores break down as follows:
- 80-100: A low risk of late payments
- 50-79: A medium risk of late payments
- 49: A high risk of late payments
Business Credit Score
Your business’s credit score ranges from 1 to 5. 1 is the best score. This matches your business with other companies with comparable payment histories. The score reveals how often those businesses tend to pay promptly. This information can help lenders to recognize your business’s standing. However, it does not genuinely show all of the payment records from your small business.
Financial Stress Score
The financial stress score also ranges from 1 to 5. This score matches your company with other companies sharing comparable financial and business characteristics. These similarities are in areas like size or amount of time in business.
This score shows how often those companies tend to pay on time. As before, 1 is the best score. This rating is a broader evaluation of the business landscape, versus an analysis of your company’s genuine payment history.
A great PAYDEX score for your company is 80-100.
How to Get a Business Credit Report: Equifax
Equifax furnishes a risk monitoring service which is easier as it permits reports to go directly to you. If you do not wish to pay for ongoing reports, you can as an alternative request your business’s Equifax report.
On top of that, if you need to dispute your small business’s Equifax report, you can do so by adhering to the information on their website. You can learn how to review your Equifax report by checking out a specimen of their reports.
Your Business’s Equifax Score
Equifax displays three distinct business determinations on its commercial credit reports. These are the Equifax payment index, your company’s credit risk score, and its business failure score.
Equifax Payment Index
Similar to the PAYDEX score, Equifax’s payment index, which is measured on a scale of 100, shows how many of your small business’s payments were made on time. These include both information from creditors and vendors.
But it’s not meant to forecast future behavior, which is what the other two scores are for.
Equifax Credit Risk Score
Equifax’s credit risk score assesses how likely it is your small business will become severely delinquent on payments. So scores range from 101 to 992, and they assess:
- Available credit limit on revolving credit accounts, e. g. credit cards
- Your business size
- Proof of any non-financial transactions (e. g. vendor invoices) which are delinquent or were on charge off for two or more billing cycles
- Length of time since the opening of the earliest financial account
Equifax Business Failure Score
Lastly, Equifax’s business failure score takes a look at the likelihood of your small business shutting down. It ranges from 1,000 to 1,600, appraising these elements:
- Total balance to total current credit limit average utilization in the previous three months
- The length of time since the opening of the oldest financial account
- Your business’s worst payment status on all trades in the prior 24 months.
- Proof of any non-financial transactions (e. g. merchant invoices) which are late or have been on charge off for two or more billing cycles.
Equifax Scores Analysis
For the credit risk and the business failure scores, a rating of 0 means bankruptcy.
Hence a good Equifax score for your small business is as follows:
- Payment Index 0-10
- Credit Risk score 892-992
- Business Failure score 1400-1600
How to Get a Business Credit Report: Experian
Experian also provides a method for acquiring reports sent to you for a cost. As a result you can track your Experian business credit score and the setup is simple.
But if you would rather not get continuing reports (and pay for them), then order a single Experian report for small business on their site.
Likewise, if there are any complications or matters of contention, you can dispute any mistakes on your business’s Experian report. Just follow the directions on their website. Also learn about checking your Experian report by evaluating a sample Experian small business credit report.
Your Small Business’s Experian Business Credit Score
Experian’s Credit Score report includes a business credit score along with other facts, including account histories, payment trends, and public records. Experian commercial credit scores run from 1 to 100.
So unlike Dun & Bradstreet’s PAYDEX score and Equifax’s payment index, Experian takes into consideration several factors, and not just payment histories.
Experian Scoring Factors
The variables that go into the calculation include:
- Lines of credit your company has an application for in the last nine months
- New lines of credit you’ve begun in the last six months
- Your small business’s years in business
- Payment history in the prior twelve months
- Lines of credit in use in the prior six months
- Collections totals within the most recent seven years
- Percent of available credit in use
- Number of payments one – 30 days overdue, or 31 days or more late
- Amount of non-net-30 lines of credit (that means the payment is due in fewer or more than 30 days).
So in most cases, even businesses that use credit conscientiously will get a medium-low risk rating. As you might expect, older businesses will have an easier time attaining a low-risk rating.
A good Experian score for your small business is 76-100.
How to Get a Business Credit Report Before Report Mistakes Drag Your Scores Down
Sometimes, it pays to hand over a few dollars to ensure that you acquire your company credit reports consistently. It’s a lot less complex than have to always remember to do this. And you’ll probably examine these reports more closely, as they come at a price tag.
Stay on target and make use of the tools these various credit reporting companies offer, and make your life easier. After all; you’ve already got enough on your plate.
As a result of the recent data breach, there are all the more reasons to check small business credit reports and personal credit reports. And be vigilant about any issues you spot. Discover this new way to understand and how to get a business credit report and scores.