Page 145 - Winning The Credit Game Bundle (CK Patrick)

It’s worth noting here that FICO uses different processes for
evaluating small, medium-sized, and big businesses. This is
important because otherwise, larger businesses would have a
huge advantage over small businesses due to their larger cash
flows and larger assets.
Since FICO considers business size when making credit score
determinations, a sole proprietor freelancer can have the same
FICO score as Walmart if they play their cards right, and can be
just as likely to get approved for a loan! 2

HOW DO YOU BUILD YOUR FICO SBSS?

Remember how we said that a business credit score of 140 was
necessary to be considered for an SBA-backed business loan?
Good news! A business owner with a stellar personal credit score
and excellent business cash flow can obtain a business credit
score of 140 even if they just started their business last month
and have no prior business credit history.
This is encouraging for any small business owner who is
intimidated by the thought of entering the business credit game.
However, 140 is the very minimum business credit score that
may qualify you for SBA-backed loans. To have higher chances
of getting more loans with better interest rates and higher credit
limits, you will want to build your business credit in much the
same way you would build your personal credit. For new busi-
nesses, there are two major ways to do this:

1. Maintain your personal credit. Sole proprietorships
and new businesses are especially vulnerable to taking
credit score hits if their owner’s personal credit score
drops.
2. Signing up for new lines of credit such as net 30
accounts, revolving credit accounts, and more.
Throughout the rest of this book, we will cover which
account types to apply to over the upcoming months
to maximize your business credit score.

133