Understanding Business Credit Scores: What Lenders See

Business Credit vs. Personal Credit

Many business owners don't realize that businesses have their own credit profiles — separate from personal credit. While personal credit (FICO) ranges from 300-850, business credit scores use different scales and are maintained by different bureaus.

The Three Business Credit Bureaus

Dun & Bradstreet (D&B)

D&B uses the PAYDEX score, which ranges from 0-100. A score of 80+ is considered good. D&B also provides a Commercial Credit Score (1-100) and a Financial Stress Score.

Experian Business

Experian's Intelliscore ranges from 1-100. A score of 76+ is considered low risk. Experian blends business and personal credit data in some models.

Equifax Business

Equifax provides a Business Credit Risk Score (101-992) and a Business Failure Score (1,000-1,610).

What Affects Your Business Credit Score

1. Payment History

The most important factor. Late payments — especially those more than 30 days past due — significantly lower your score.

2. Credit Utilization

How much of your available credit you're using. Keep utilization below 30% of your total credit limit.

3. Length of Credit History

Older accounts with good payment history strengthen your profile. Keep old accounts open even if you don't use them frequently.

4. Credit Mix

Having different types of credit (term loans, lines of credit, credit cards, trade accounts) can help.

5. Public Records

Bankruptcies, tax liens, and judgments severely damage business credit. Some stay on your report for 7-10 years.

6. Company Size and Age

Older, larger businesses tend to have stronger credit profiles simply because they've had more time to build history.

How to Build Business Credit

1. Establish your business entity — LLC, S-Corp, or C-Corp with an EIN
2. Open a business bank account — separate from personal finances
3. Get a DUNS number — register with Dun & Bradstreet (free)
4. Open trade accounts — vendors that report payments to credit bureaus
5. Apply for a business credit card — use it responsibly and pay on time
6. Pay early when possible — PAYDEX rewards early payments with scores above 80
7. Monitor your reports — check all three bureaus annually for errors

What Score Do Lenders Want?

• Traditional bank loans: Typically require a PAYDEX of 75+ and good personal credit
• SBA loans: Focus heavily on personal credit but also review business credit
• Online lenders: Vary widely — some accept lower scores but charge higher rates
• Equipment financing: Often more lenient on credit, focuses on collateral value

Common Myths

Myth: If I have good personal credit, I don't need business credit. Reality: Many lenders — especially for larger loans — want to see both.

Myth: Checking my business credit hurts my score. Reality: Unlike personal credit, business credit inquiries don't lower your score.

Myth: My LLC automatically has a credit profile. Reality: You need to actively build credit through accounts that report to bureaus.

The Bottom Line

Building strong business credit takes time — often 1-2 years of consistent on-time payments. Start early, keep personal and business finances separate, and monitor your profiles regularly. Your business credit score is one of the factors in your overall Funding Readiness Score.

LoanFit Pro provides educational content only and is not a lender, credit repair service, or financial advisor.