Becoming a lasting success in the business world takes a lot more than producing an awesome product or service and having a winning attitude. While those attributes are very important, the one thing that most startups need in order to succeed, is money. If your dream is to start your own business, then you will need money to develop the product or service, to stock inventory and to purchase supplies and equipment. Money is also required to advertise and to pay your eager team of employees. In most cases, it will take you having money to make you money – and this is where personal credit becomes highly valuable.
Essentially, personal credit is a factor of financial trust. Every time you apply for a line of credit, high power establishments such as banks and credit card companies take a peek inside your credit history. They access your credit information to determine if they are willing to approve your request for a loan. They also use your credit information to calculate your interest rate percentage.
So, it goes without saying that the integrity of your personal credit can either be an asset or a liability for your entrepreneurial dreams. Below are the three ways to strengthen your personal credit and jumpstart your business.
Turning your Personal Credit into a Business Asset:
- Get your credit report: Knowing what’s in your report is step number one to strengthening your credit. Every legal citizen of the United States is granted a free annual credit report from the national credit bureaus, Experian, Equifax and TansUnion. The report is based on length of credit, past financial applications (such as credit card and loan applications), type of credit used, debt and payment history. Based on your report, a score will be determined. Having a low credit score will almost guarantee unapproved loans, while having an average score usually means higher interest rates. An excellent score will almost guarantee approved loans, and low to zero interest rates once approved.
- Repair your credit: Credit repair is very obtainable, even for those with terrible credit reports and low scores. However, many people are intimidated by the thought of repairing their credit, while many others simply do not know how to make healthy financial decisions, so more often than not, their score remains unchanged. While it is possible to repair your credit on your own, it is often recommended to seek the aid of a professional team. Creditrepair.com and other online resources can help by using your credit report to pinpoint issues. They can then develop a repair plan and educate you on making financial decisions. It usually takes between for to six months to see any positive changes.
- Monitor your account: Just as important as repairing your credit is monitoring it. Monitoring your credit by reviewing your annual credit reports will allow you to maintain your good credit and also to challenge any mistakes that can hinder your score.
Once you have strengthened the integrity of your personal credit, you can then confidently move forward with your plans to grow your business. However, it is important to know that being approved for business credit is a huge responsibility. Use the funds wisely to see continual success, and pay back your loans in a timely manner to keep your credit strong.