How to Clean Up Your Business Credit Report

Your business credit report is important for your company getting a business loan, because it verifies the information provided in your credit application and business plan. Much like a personal credit report, unless it is managed, the business credit report is often inaccurate, incomplete, and presents your company in a poorer light than it should. Ensure that your business credit report is accurate and complete and do it very early in the process if you want to maximize your chances of getting your business approved for a business loan or equipment lease.

Business credit reports are sold to the credit underwriters employed by lenders and equipment lessors. Dun & Bradstreet is the largest supplier of business credit reports. The data that goes into the business credit report comes from a lot of different public and non-public sources. Do not trust that the information is always accurate because it is not. Take responsibility and verify the report and add as much information as possible.

Steps to Take to Clean Up Your Report

The first step is to get a copy of your business credit report. You do not need to pay for one, you can get it for free from any provider and you can modify the information either online or over the phone. We recommend doing it online. Once you have the business credit report, verify it or correct it.

The following tips will help you out:

• Make sure the business credit report accurately shows the business name, and any trade styles (DBA’s).
• Verify the physical business address and include your website address.
• Look at the payments score in detail and that it is accurate. If it does not accurately sow payment promptness you can challenge an entry, but you will have to be able to prove it.
• Is ownership of the business explained accurately, the report properly shows the business entity type and time in business.
• The business credit report allows you to add the name of the officers of the company, the title and business function, and some work experience.
• It also provides for entry of the history of the company and any recent company events, such as a move to a new location, a change in ownership, etc.
• You can decide whether to add financial information about the company but remember that you will be making sometimes sensitive information available to everyone if you do so.
• The business credit report will show liens, lawsuits, and loans. Make sure this information is accurate.
• Review your business SIC/NAICS code. You want your code to be accurate or else it will not be properly evaluated if your business is not categorized correctly.
• Check public record information. If your credit report lists items such as UCC filings, tax liens or even judgments, you want to check to make sure that information is accurate and complete. If any public record information is wrong, you can dispute it with the credit reporting agency.

The Bottom Line

Managing your business credit report is good practice. Be sure to schedule a follow-up in a year to revisit the report and check any changes or to add new information. It is never too late to work on cleaning up your business credit score. The more effort you put into improving business credit, the bigger your potential return when it comes to your bottom line.