How to Interpret a Business Credit Report

A business credit report is not much different from a personal credit report. They provide insight to a lender the credit worthiness of the business. These reports provide you all the information you need about your credit rating and the reasons behind your credit score.

Difficulty: Moderately Easy

Instructions

1. Review your credit rating. This is the number by which your credit is scored. This number is an example of the risk a lender may take in granting you credit.

2. Analyze your payment history, which may be several pages long. The payment history provides a record of all payments made by the business, all debts owed and how many times the business has been late in making payments.

3. Look at the company information on your report. The information should be completely accurate. The business type, amount of employees and sales figures should be included in this section.

4. Verify the legal issues section of the report is accurate if your company has filed for bankruptcy protection, filed any lawsuits, had lawsuits filed against the company or has outstanding liens.

5. Read the collection proceeding part which reports any outstanding balances that were sent to collection agencies.

6. Check your Uniform Commercial Code (UCC) filings. These filings are a major indicator of your use of credit. Assets used as collateral to pay for other loans are listed here.

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