Credit Checks – Simple Steps to Give You the Best Chance of Approval

happy young business woman doing a credit check online

Written by admin

November 14, 2022

If you’re looking to take out a loan for your business, you’ll need to have a credit check. This is how lenders decide whether or not to give you money. Your credit score is one of the most important factors that they look at.

A credit check is when a lender looks at your credit history to see if you’re a good candidate for a loan. They’ll look at things like how much debt you have, whether you make your payments on time, and your credit utilization ratio.  

In this blog post, we’ll talk about how to improve your chances of being approved for a loan by taking simple steps before your credit check.

hands of business owner holding a tablet with sign in page on screen

1. Check your credit score and report

The first step is to check your credit score and report. You can get this information for free from websites like Experian or illion. This will give you an idea of where you stand and what factors are impacting your score.

2. Dispute any errors

If you find any errors on your credit report, dispute them immediately. This can be done online or by mail. Include any supporting documentation you have to prove the error is not valid. The credit bureau will investigate the error and remove it from your report if they find it to be invalid.

stressed business man checking his poor credit score online

If you have any errors on your credit report, it is important to dispute them right away. This can help improve your credit score and help you avoid any potential negative consequences, such as being denied for a loan.

3. Bring balances down on credit cards

One factor that lenders look at is your credit utilization ratio. This is the amount of debt you have compared to your credit limit. It’s best to keep this ratio below 30%, but the lower the better. If you have a high credit utilization ratio, you can try to lower it by paying down your debt or asking for a higher credit limit.

Hand drawn People Online Shopping Credit Card

4. Pay bills on time

Your payment history is one of the most important factors in your credit score. Make sure you’re paying all of your bills on time, including your rent or mortgage. If you have any late payments, try to get them removed from your credit report.

5. Use a secured credit card

If you have bad credit, you may not be able to get a traditional credit card. But you can get a secured credit card, which is backed by a deposit you make. This can help you rebuild your credit if you use it responsibly.

6. Get a co-signer

two business owners signing a document; cartoon illustration

If you’re having trouble getting approved for a loan or credit card, you may be able to get a co-signer. This is someone with good credit who agrees to be responsible for the debt if you can’t pay it back.

7. Become an authorized user

If you know someone with good credit, you may be able to become an authorized user on their credit card. This means you’ll get your own card linked to their account. You won’t be responsible for repaying the debt, but you’ll get the benefit of their good credit history.

8. Check your credit report regularly

It’s important to keep an eye on your credit report so you can catch any mistakes. You’re entitled to a free copy of your report from each of the three major credit bureaus once a year. You can get your reports for free from websites like Experian or illion.

credit report document

9. Use credit wisely

Once you have good credit, it’s important to use it wisely. That means only borrowing what you can afford to pay back and making your payments on time. If you do that, you’ll be in good shape to maintain your good credit for years to come.

10. Get help if you need it

If you’re having trouble managing your debt, there are resources available to help you get back on track. Many credit counseling services can help you create a plan to get out of debt.

young business woman asking for help with her credit report from a female expert

With these simple steps, you can take control of your credit and give yourself the best chance of getting approved for the loans and credit cards you want. So don’t be afraid to check your credit report and start making improvements today.



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