How Business Credit Rating is Determined
Most people have at least a moderate understanding of what a personal credit score is, how it is determined, and the different ways that it can affect their lives. Business credit ratings are formed on similar principles, though there are several significant distinctions between the business and individual systems. Depending upon the nature of your business or your approach to its growth, generating and maintaining a strong credit rating may be vital to securing the loans and terms of financing that you need to turn a desirable profit.
If you are encountering resistance to your efforts to obtain credit for your company, consulting with an experienced business attorney who understands the subtleties of corporate finance is highly recommended. Contact the Des Moines business lawyers of LaMarca Law Group, P.C. at (877) 327-2600 to discuss your situation or simply to learn more about how you can effectively grow and enrich your enterprise.
Factors that are Evaluated
With personal debt, your credit rating is shaped by the condition of outstanding financial obligations, your payment history, and other pertinent factors that offer some insight into your track record with other institutions’ money. With a business credit rating, the specifics vary, but the concept remains the same. In assessing your company’s creditworthiness (and essentially its corporate financial honesty), prospective lenders, partners, or others are attempting to gain a perspective on your level of risk. Some of the elements that may be considered are:
- Transactional history with suppliers
- Repayment history with lenders
- Corporate financial statements
- Legal actions and encumbrances
- Business profile (size, structure, reputation, etc.)
We are dedicated to helping Iowa’s business owners position themselves for success because we understand the positive effect that this has on the entire community. Contact the Des Moines business lawyers of LaMarca Law Group, P.C. today at (877) 327-2600.