Your overall financial health depends on your credit score. When you apply to a loan, lenders will use your score as a guideline for how much you will need to pay. The business credit score is not the same as consumer credit scores and can differ from one bureau or another. This means you cannot rely on one credit bureau to provide accurate credit scores.
Equifax
Equifax has been in the credit score business since 1996 and now provides reports to consumers. These reports contain public records, 12-month payment history, and comments made by previous credit grantors. Consumers can use these reports to apply for credit and set credit limits. Businesses can also use the information in these reports to monitor their financial health.
Equifax has two different scores for companies: a credit risk score and a business failure score. The credit score is a number that ranges from one to nine hundred. It indicates how credit-worthy a company. The business failure score, on the other hand, is a number between one thousand and is based on how likely a company will fail within the next 12 months.
Experian
A business's Experian credit score is a number between one and one hundred that is calculated based on the risk of defaults or delinquent payment. Higher risk means a higher score. Experian uses 800 variables to calculate your score. These include information obtained from credit card companies and legal filings. It also includes information from public files and demographic information. Lenders consider businesses with scores of one to ten high-risk. Businesses with scores of eleven to fifty five are considered moderate-risk. A score of 76-100 is considered to be low-to middle risk. A score seventyfive to one hundred can be considered good.
Your Experian credit score can determine whether or not you're approved for a loan or credit card. A high score is more likely to be approved for the loan/credit that you apply, while a lower score can lead to rejection.
TransUnion
TransUnion provides consumers with a free credit score every year. It also provides identity theft insurance and credit monitoring products. However, it has been accused by deceptive market practices. The company is not a bad company, it's just deceptive marketing practices.
TransUnion uses its own algorithm when calculating credit scores. This is a reflection of TransUnion's credibility and ability to assess risk. TransUnion credit scores are not sufficient to make decisions about auto loans, mortgages or credit cards. To avoid damaging their credit scores, they should instead carefully review their credit reports.
Experian Business Longevity
Experian is the largest global information provider. Experian assists businesses in implementing successful customer relations management, marketing, and risk management strategies. Experian's business longevity report gives a detailed overview of a company’s credit history and predicts its likelihood of falling behind in the next twelve months.
Experian Intelliscore Plus
Experian Intelliscore Plus can help you determine your credit score. The model uses over 800 owner and company data points to create a single score. Experian has developed a proprietary formula to calculate scores. Though it is impossible to know exactly which factors impact your business score, you can use the data to make informed decisions. Your payment history is an important factor in your score. Avoid late payments and delinquent accounts to increase your score.
An important aspect of getting a loan is establishing a credit score for your company. Many lenders prefer to use the Intelliscore because it is a reliable indicator of the risk that your business will default on its payments. The score is a combination o of current payment status, percentages of delinquent accounts, overall trade balance, and the percentage of defaulted accounts.