Email marketing is one of the most important strategic channels in a marketer’s toolkit. According to UK DMA, 91 percent of marketers rate email as their most important channel, followed by social media at 83 percent. Email marketing’s success rate comes from its high ROI, which DMA states comes in at around $58 for every …
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Just how Well Do We Understand Social Security? The Social Security is moneyed by the pay-roll tax obligation paid by hardworking American residents. 6.2% is secured of their salaries as well as a matching 6.2% matching payments of companies over all made up the social safety and security payments. Payments quit after the initial 90k …
Just how Well Do We Understand Social Security?
The Social Security is moneyed by the pay-roll tax obligation paid by hardworking American residents. 6.2% is secured of their salaries as well as a matching 6.2% matching payments of companies over all made up the social safety and security payments. Payments quit after the initial 90k of earnings is gotten to per participant.
The optimal Social Security situation is in which the payments are a lot greater than the quantity of advantages to be offered. As well as any type of excess fund after paying all advantages is positioned right into a Trust Fund. The Trust Fund is after that spent in Treasury Bonds because the regulation needs it.
The United States Government might make use of the cash however needs to spend for it later on. Throughout the year 2003 the management headed by Pres. Bush has actually gathered a shortage of $536 billion in which the $156 billion excess of Social Security was utilized. The issue currently is that the management is drawing away all concerns far from the fund they obtained and also is entirely overlooking the entire problem by informing the American individuals that privatization is the only point that can conserve Social Security out of its economic dilemma.
They are likewise stating that if not privatize, the Social Security will certainly have to reduce on some of the future advantages. As well as what takes place currently is that the federal government takes on the fund, invest it as well as after that fail to remember all concerning it which is not excellent given that it impacts the advantages to be gotten by social safety participants.
There should certainly appertain allowances of funds indicating that the fund for Social Security Benefits must not be utilized for battle and also tax obligation cuts. And also if ever before, it is made use of after that the management needs to be liable sufficient in returning the cash they have actually obtained. Its not theirs to begin with, it’s for the American individuals that have actually striven in order to save money on for their future.
The Social Security is moneyed by the pay-roll tax obligation paid by hardworking American people. The issue currently is that the management is drawing away all concerns away from the fund they obtained and also is totally ignoring the entire concern by informing the American individuals that privatization is the only point that can conserve Social Security out of its economic dilemma.
And also what takes place currently is that the federal government takes on the fund, invest it and also after that neglect all regarding it which is not excellent given that it impacts the advantages to be gotten by social protection participants.
There ought to be appropriate allotments of funds suggesting that the fund for Social Security Benefits ought to not be utilized for battle as well as tax obligation cuts.
The post Just how Well Do We Understand Social Security? appeared first on ROI Credit Builders.
Just how Well Do We Understand Social Security? The Social Security is moneyed by the pay-roll tax obligation paid by hardworking American residents. 6.2% is secured of their salaries as well as a matching 6.2% matching payments of companies over all made up the social safety and security payments. Payments quit after the initial 90k …
The post Just how Well Do We Understand Social Security? appeared first on Buy It At A Bargain – Deals And Reviews.
Just how Well Do We Understand Social Security?
The Social Security is moneyed by the pay-roll tax obligation paid by hardworking American residents. 6.2% is secured of their salaries as well as a matching 6.2% matching payments of companies over all made up the social safety and security payments. Payments quit after the initial 90k of earnings is gotten to per participant.
The optimal Social Security situation is in which the payments are a lot greater than the quantity of advantages to be offered. As well as any type of excess fund after paying all advantages is positioned right into a Trust Fund. The Trust Fund is after that spent in Treasury Bonds because the regulation needs it.
The United States Government might make use of the cash however needs to spend for it later on. Throughout the year 2003 the management headed by Pres. Bush has actually gathered a shortage of $536 billion in which the $156 billion excess of Social Security was utilized. The issue currently is that the management is drawing away all concerns far from the fund they obtained and also is entirely overlooking the entire problem by informing the American individuals that privatization is the only point that can conserve Social Security out of its economic dilemma.
They are likewise stating that if not privatize, the Social Security will certainly have to reduce on some of the future advantages. As well as what takes place currently is that the federal government takes on the fund, invest it as well as after that fail to remember all concerning it which is not excellent given that it impacts the advantages to be gotten by social safety participants.
There should certainly appertain allowances of funds indicating that the fund for Social Security Benefits must not be utilized for battle and also tax obligation cuts. And also if ever before, it is made use of after that the management needs to be liable sufficient in returning the cash they have actually obtained. Its not theirs to begin with, it’s for the American individuals that have actually striven in order to save money on for their future.
The Social Security is moneyed by the pay-roll tax obligation paid by hardworking American people. The issue currently is that the management is drawing away all concerns away from the fund they obtained and also is totally ignoring the entire concern by informing the American individuals that privatization is the only point that can conserve Social Security out of its economic dilemma.
And also what takes place currently is that the federal government takes on the fund, invest it and also after that neglect all regarding it which is not excellent given that it impacts the advantages to be gotten by social protection participants.
There ought to be appropriate allotments of funds suggesting that the fund for Social Security Benefits ought to not be utilized for battle as well as tax obligation cuts.
The post Just how Well Do We Understand Social Security? appeared first on ROI Credit Builders.
Lenders often look at your commercial credit report in addition too, or in lieu of, your personal credit score. As you know, they use the information on the report to help them decide if your business is a good credit risk, or a bad one.
So, why is it important to understand your commercial credit report? The answer is, because what your commercial credit report says greatly affects the fundability of your business. Of course, there are many factors that affect fundability, and it is important to understand each of them. However, there are many pieces to the fundability puzzle and it is best to understand each one individually.
Keep your business protected with our professional business credit monitoring.
Dun & Bradstreet offers six different reports. Truly, the one utilized most often by lenders is the PAYDEX. Honestly, this is probably because it is the one most like the consumer FICO score. You see, it measures how quickly a company pays its debt on a scale of 1 to 100. For reference, lenders like to see a score of 70 or higher. To put it in perspective, a score of 100 reveals the firm makes payments ahead of time. A rating of 1 shows they pay 120 days late, or more.
Together with PAYDEX, they offer the following scores and reports.
As you might imagine, this rating determines the chance the company will not pay, will be late paying, or will come file for bankruptcy. For scoring, the range is 1 to 5, with 2 being a good score.
Not surprisingly, this is a measurement of the pressure on a firm’s balance sheet. It shows the possibility of a closure within a year. The range is 1 to 5, and a 2 is good.
This is a ranking that predicts the odds of a firm surviving one year. Similarly, it ranges from 1 to 9, with a 5 being a good score.
As the name implies, this is a recommendation for the amount of debt a company can handle. Financial institutions usually use it to establish how much credit to extend.
This is an estimation of overall business risk on a scale of 4 to 1, where a 2 is considered good. The smaller the number the better. The rating is given as a combination of numbers and letters, which together show a company’s net worth.
Consequently, if there isn’t enough data on a business to assign a regular rating, an alternative score is assigned. This is called a credit approval score. It is based on the number of employees. They will use any data they have available to calculate this alternative rating. That means, a company can control this to a point by ensuring D&B has all of the information they need.
Along with the PAYDEX, Dun & Bradstreet releases a commercial credit report in three components. Each part shows how likely the business is to default on expenses or become seriously late on payments.
On a range of 101 to 670, the commercial credit score anticipates the likelihood of a firm making late payments. A rating of 101 indicates it is very likely that the company will be late with payments. Likewise, a score of around 500 is good.
For this measurement, the scale runs from 0 to 100. It shows the chance of delinquency too. However, it determines this probability versus other companies in the Dun & Bradstreet system. A rating of 1 is the highest possible probability in relation to other companies. The majority of loan providers consider a rating of 80 or higher to be an advantage.
In contrast to the other reports, this is an approach of dividing businesses into classes based on the chance of delinquency. Firms in class 1 are the least likely to be overdue. Likewise, if you are in class 2, that’s still good.
The exact formula used by Dun & Bradstreet to calculate their ratings is proprietary. What we do know is what information they look for and where they get it. The initial source of this information is the business itself.
A business must submit a financial statement to D&B before getting a full rating. Without that, a business gets a limited rating based on the number of employees. For example, the rating would be 1R if the business has 10 employees or more. But it’s 2R if they have fewer than 2 employees.
With no financial statement, a composite credit appraisal can still be issued. However, a business is only eligible for a rating up to a 2 in this case. They are ineligible for a 1 rating without a financial statement.
Businesses can also submit trade references to Dun & Bradstreet themselves. The catch is, it costs money to do so. Furthermore, there is no guarantee it will result in a score increase. Anyway, if you are properly building business credit it will happen for free.
Keep your business protected with our professional business credit monitoring.
Besides getting data from the business, Dun & Bradstreet also accesses public records. They look for liens and bankruptcies, and anything to show creditworthiness, or a lack thereof. They also partner with the Small Business Finance Exchange to access data from their records.
Experian gathers data from a lot of the same sources as Dun & Bradstreet. As a result, their reports are similar. There are a few key differences in sources, calculation, and also presentation however.
Experian uses the Intelliscore Plus credit score, which shows a statistics-based credit risk. The result is, it is a highly predictive score that can help users make well-informed credit decisions.
The Intelliscore scores range from 1 to 100, with a higher score indicating a lower risk class.
| Low Risk | 76-100 |
| Low-Medium Risk | 51-75 |
| Medium Risk | 26-50 |
| High-Medium Risk | 11-25 |
| High Risk | 1-10 |
One of the things Intelliscore is most known for is the list of specific key factors they use that can indicate how likely a business is to pay its debt. In fact, over 800 variables go into the Intelliscore Plus calculation. Many of them are from the general information all credit agencies look at. However, some are unique to Experian. Here’s a breakdown.
As you might imagine, this is your current payment status. That means, it shows how many times accounts have become delinquent. It also shows how many accounts are currently delinquent, as well as the overall trade balance.
Frequency shows how many times your accounts have gone to collections. In addition, it notes the number of liens and judgments you have. Also, it shows any bankruptcies related to your business or personal accounts.
It also incorporates information about your payment patterns. Were you regularly slow or late with payments? Did you decrease the number of late payments over time? That affects your score.
This specific factor focuses on how you use credit. For example, how much of your available credit are you utilizing right now? Do you have a high ratio of late balances when compared with your credit limits?
Of course, if you are a new business owner, a lot of this information will not exist yet. Intelliscore Plus handles this by using a blended model to identify your score. This means your personal credit score becomes part of determining your business’s credit score.
Surprising to some, the blended score is a one-page report that provides a summary of the business and its owner. A combined business-owner credit scoring model works better than a business or consumer only model. In fact, blended scores have been found to outperform consumer or business scores alone by 10 – 20%.
FSR predicts the potential of a business going bankrupt or not paying its debts. Consequently, this score identifies the highest risk businesses by using payment and public records. They look at a number of factors, some of which include:
Similarly, Equifax shows three different points on its commercial credit report. These include:
Similar to PAYDEX, Equifax’s payment index is a measurement on a scale of 100. It shows how many of your small business’s payments were made on time. Like the others, it uses data from both creditors and vendors. However, it’s not meant to anticipate future behavior. That is what the other two scores are for.
This score shows the likelihood of your company becoming severely delinquent on payments. Scores range from 101 to 992 and include an evaluation of:
Keep your business protected with our professional business credit monitoring.
Equifax’s business failure score takes a look at the risk of your business shutting down. Similar to others, it runs from 1,000 to 1,600 and bases its scoring on these factors:
For the credit risk and the business failure scores, a rating of 0 means bankruptcy.
A positive Equifax score for your business is as follows:
Actually, there are multiple other agencies that will issue a commercial credit report. It’s just that these three are the most commonly used. Still, there has been an increase in the use of another option recently. It’s the FICO SBSS.
The FICO SBSS is the business variation of your personal FICO credit report. Unlike your personal FICO, the SBSS reports on a scale of 0 to 300. The higher the score the better. However, the majority of loan providers demand a rating of least 160.
Surprisingly, it is significantly different from other business credit scoring designs. The SBSS utilizes your corporate credit score and personal credit rating. It also makes use of monetary details like business assets and income. As you can see, the goal is to give an overall financial picture rolled into one rating.
Unfortunately, business owners cannot access their FICO SBSS by themselves. There is a proprietary formula for score computations. Furthermore, they do not make that data public. As a result, you go into lending institutions blind as to what your FICO SBSS credit rating might be.
Complicating things even more, lenders can choose how certain factors are weighted in the calculation of your score. This means your FICO SBSS could actually be different from one lender to the next. For example, one lender could put more weight on your business payment history, while another could lean more on your personal credit score.
As I said before, overall business fundability is an intricate web woven out of your business information, business credit, organization, personal credit, public records and more. Your business credit, though only one part, is a large part of the fundability puzzle. This means, you need to know what your commercial credit report says, why it says it, how it is affecting the fundability of your business, and how to make changes when necessary.
The post Do You Understand Your Commercial Credit Report? appeared first on Credit Suite.
Imagine you are in a foreign country and have no understanding of the local language. Of course, you need the basic things such as food, water, and shelter just to survive. The problem is, you cannot ask anyone where to find them. Consequently, each time you try to get these things for yourself the door is shut in your face. You cannot explain yourself in order to get what you need, because you do not speak the language. Even if they did try to help you, you would have no clue what they were talking about. You wouldn’t understand. This what it is like when you do not understand your business credit card score.
Similarly, you need funding for your business to survive. A bad business credit card score can keep you from getting it. If you do not understand your score however, you cannot help yourself. For this reason, you need to know what the score means, what it says about your business, and how it is calculated. Once you understand these things, you can get to work correcting whatever barrier is in the way.
The truth is, it depends. As you likely know, there are various agencies that report personal credit scores. Likewise, there are several that report business credit scores as well. Most noteworthy are Dun & Bradstreet, Experian, Equifax, and CreditSafe. There are a few smaller, lesser known business CRAs. Certainly however, these are by far the largest and most commonly used by lenders.
That’s the easy part. Where your business credit card score comes from and what it means is a little more complicated. First of all, there are a ton of different scores. Also, different CRAs gather their information and calculate their scores differently. As a result, seeing your business credit card score can be very difficult. Understanding it can be even harder. Below, we break down what each score means and where the information comes from for each of the major credit reporting agencies.
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Dun & Bradstreet offers several different types of business credit reports. In fact, there are six different reporting options in all. They all offer different information related to credit worthiness. The result is, it takes all of them to get the whole picture.
The report lenders use most is likely the PAYDEX. This is probably because it is the easiest to understand, due to it being the most like the consumer FICO score. It measures how quickly a customer makes payments and ranges from 1 to 100. Scores of 70 or higher are acceptable. For reference, a score of 100 shows payments are made in advance. A score of 1 indicates that they are 120, or more, late.
The delinquency predictor score measures how likely it is that the company will not pay,
will be late paying, or will fall into bankruptcy. On a scale of 1 to 5, a 2 is good.
The financial stress score measures pressure on the balance sheet. Therefore, it shows how likely the company is to shut down within a year. These scores range from 5 to 1. A score of 2 is good.
This rating ranks the odds of a company surviving 12 months. The minimum score is a 9 and the
maximum is 1. A good score is 5.
The credit limit recommendation reflects a business’s borrowing capacity. Even more, it is a
recommendation for how much debt a company can handle. Typically, creditors use this to
determine how much credit to extend.
This one ranks overall business risk on a scale of one to four. A score of 2 is good. The rating is
given in conjunction with letters, the combination of which indicate a company’s net worth.
Even if there isn’t enough information on a business to assign a regular rating, Dun and Bradstreet will assign what they call a Credit Appraisal Score. Due to the lack of information, this is based on number of employees. Alternatively, they may offer a rating based on what data is actually available.
Experian uses what it calls Intelliscore as its credit ranking. There are more than 800 different factors that they use to predict a company’s credit risk. With Intelliscore, a score of 76 or higher indicates a low risk of default or late payment. If a score falls between 51 to 75, it indicates a low to medium risk. Scores from 26 to 50 are medium risk. Finally, from 25 down to 1 is medium high to high risk.
Experian offers a number of other scores also.
This is a highly predictive percentile score that indicates the likelihood that a business will go seriously delinquent, or have a major financial issue such as a bankruptcy within the next year.
Intelliscore Plus uses more factors to determine the score than the original Intelliscore. While payment history still accounts for 5 to 10%, current payment status, trade balances, and percent of accounts delinquent make up 50 to 60% of the score. Credit utilization, company profile, age of the business, industry risk, and public records account for the rest. Public records include:
Data comes from suppliers, lenders, legal filings, collection agencies, credit card companies, and of course public records.
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FSR predicts the potential of a business going bankrupt or defaulting on its obligations. The score identifies the highest risk businesses by making use of payment and public records. These records include high utilization of credit lines, severely delinquent payments, tax liens, judgments, collection accounts, risk industries, length of time in business, etc.
This is a one-page report that provides a summary of the business and its owner. A combined business-owner credit scoring model is more comprehensive than a business or consumer only model. Blended scores have been found to outperform consumer or business alone by 10 – 20%.
Equifax gets its business credit data in ways similar to D&B and Experian. Like D&B, they also have a sharing agreement with the Small Business Finance Exchange. In addition, they get Net 30 type industry trade credit information from a wide variety of suppliers that provide products and services to businesses on an invoice basis.
They combine financial data with industry trade data, and they add in utility and telephone payment data. They also use public records information.
Equifax Business credit scores include:
It is scored on a scale of 1 to 100, with 90+ indicating that a business has paid its obligations as agreed. An 80 to 89 means they are 1 to 30 days past due, 60 to 79 indicates they are 31-60 days overdue, and a score of 40 to 59 is 61 to 90 days past the payment date. In the same way, It just goes down further from this point.
This score indicates the chance of a company paying its bills late on the following scale:
The purpose of this report is to list bankruptcies, judgments, and liens along with the amount, date of the most recent filing, and how they were satisfied.
This is a pie chart that shows your company’s credit usage. It gives a visual of what percent of your available credit you are using. That is known as your credit utilization ratio, and it has a pretty big impact on your overall credit score.
The summary report shows the number of your business’s credit accounts, as well as the date each one became active. It also lists any amounts past due, along with your most severe status of the past 24 months.
The highest amount of credit extended, the median balance, and the average open balance are included as well.
Additionally, the report lists recent activity such as number of new accounts opened recently, delinquent accounts, number of updated accounts, and inquiries.
This report shows details for the past 36 months, including credit accounts and leases. It lists the status, open and close dates, and original and current credit limits. It also shows any past due amount for each. In addition, the payment amount and frequency for each account, as well as its security status can be seen.
CreditSafe does not gather its own information like the other CRAs. Rather, they offer reporting options based on data from Dun & Bradstreet. Since they compile the data and report it in different ways, these scores still offer information that may be used differently than what is found on a Dun & Bradstreet report. They offer 3 packages: Standard, Plus, and Premier. The problem is, they do not list their prices on the website. You have to request a quote to determine what your pricing would be, as they allow you to purchase individual products as well.
Their main score, the CreditSafe rating, works on a scale of 1-100. It predicts the likelihood that payment performance will become 90 plus days past due within the next 12 months, or that the business will go bankrupt. They offer a variety of other scores and reports that provide a ton of additional information.
This score is derived from the Creditsafe rating. It compares credit risk between companies in different countries.
The Creditsafe recommended credit limit uses information from the business payment records and those of similar companies to calculate a dollar amount recommendation for the maximum amount of credit a company should receive at one time.
Compares how many days late a business pays its bills in comparison to other companies in the industry.
This is a report on the number and value of tax liens and judgements that have been filed in the past 6 years and 9 months. It also includes bankruptcies filed in the last 9 years and 9 months.
A report designed to highlight, at a glance, substantial changes in how a company is paying its bills.
Let’s you know whether the total annual business spending is going up or down when compared to the previous year.
Subscription packages come in levels, and the prices are dependent completely on your business’s individual needs. You have to speak to a consultant to get a quote.
Hit the jackpot with our best webinar and its trustworthy list of seven vendors who can help you build business credit.
Just understanding your business credit card score is not enough. You need to know what you can do about it if it isn’t helping you get funding. That’s where monitoring comes in. Unfortunately, you cannot get a free copy of your business credit reports like you can with your personal credit reports. It costs money to see your business credit card score.
For example, the big three charge closet to $50 or more for each report:
CreditSafe doesn’t even tell you a price until you talk to one of their agents. They will quote you a price after discussing your needs with you. So it’s a subscription type package that you pay monthly.
You can monitor your credit with D&B, Experian, and CreditSafe at a fraction of these costs by going to https://www.creditsuite.com/monitoring/.
First off, if your business credit card score is bad because of mistakes, you can dispute them. In this way, you can have the mistakes taken off. Do this in writing to the credit reporting agency. In addition, you will need to include backup documentation that supports your point. Do not send originals however. Rather, send copies.
In contrast, if your credit is bad and there are no mistakes, start now making payments on time. Furthermore, if you have accounts that do not report to the credit agencies, such as telephone or utility accounts, ask them to report your on-time payments. If you pay rent, ask your landlord to report your rent payments. In addition, work with starter vendors that will offer net 30 invoices without a credit check and that will report your payments. Go here to find a few to start with.
Above all, pay your bills on time. This is the number one way to increase your business credit score.
Once you understand your business credit card score, you can start to figure out what you can do about it. So knowing is half the battle. The other half is getting the problem areas corrected. Once you do, your business can get the funding it needs to grow and thrive.
The post FINALLY! Understand Your Business Credit Score! appeared first on Credit Suite.
Most people know they have a personal credit score. Many business owners do not know, however, that they may have a business credit score. This is a score very similar to your personal FICO, but it is related to your business financial transactions only. It is not connected to your personal finances at all. In fact, free business credit reports are not even connected to your social security number.
The problem is, unlike your personal credit reports, it can be difficult to determine what business credit reports have one them. It is easy to get a copy of your FICO report for free. It is not so easy to do the same with business credit reports.
Just as there are credit reporting agencies for your personal credit score, there are also business credit reporting agencies. The largest one, and the one lenders use most often, is Dun & Bradstreet. However, there are actually several others. The other two most common are Experian and Equifax.
They do not just give out credit reports for free however. In fact, the prices for reports directly from the top 3 most commonly used credit reporting agencies are pretty steep. For example:
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The prices range so broadly due to the varying complexity and detail of the information provided in each report. For example, Dun & Bradstreet has multiple types of scores and a report for each one.
The only real way to get a free copy of your credit report is if you are denied a loan based on your business credit. There are ways to see what is on it, one time, for free however.
Nav is a service that will let you see a summary of your credit reports from all three of the major credit reporting agencies. However, these are only summaries, not full reports. Generally, that means you can see your score, and maybe the accounts you have listed. While this will help you see where you stand, it will not suffice for the purpose of correcting mistakes or even to show you what you need to do to improve your score. You do have the option to pay for more information though.
Credit.net does not offer ongoing free business credit reports, you can access a free trial. There is no credit card required, and after you pull the report, you have 30 days to check it out. This means at least once you can get a totally free look at your report, because there is no fear of missing a cancelation deadline and having to pay anyway.
This is a lesser known credit reporting agency that will let you see your credit report for free before you pay for an ongoing subscription. Unlike Nav or Credit.net, they are actually calculate their own score similar to the big 3 (Experian, Equifax, and Dun & Bradstreet.) They strive to be totally transparent and to make their reports easy to understand.
You do have to pay for an ongoing subscription to CreditSafe, but they will give you a free credit report to get you started. It will only include Dun & Bradstreet, but it is a good taste of what you can see with a full subscription. It is also another option for a free copy of your business credit report. If you do subscribe, they have a number of reports that are unique to them. This means you are getting something that you may not get with the other monitoring services or even the standard reports from the Dun & Bradstreet, Experian, or Equifax.
As mentioned before, you can get a free copy of your business credit reports if a lender denies you for a business loan. This is the less fun way to see your business credit reports for free. After denial, you will receive a letter in the mail from the agency that provided the lender with your report. You will have the opportunity to request a free copy of the report that the lender saw, so that you can see why the result was denial. You have 90 days to submit your request.
Each reporting agency offers different types of reports and information, but they all contain the same general data.
Dun & Bradstreet offers several different types of business credit reports. In fact, there are six different reporting options in all. They all offer different information related to credit worthiness, and it takes all of them to get the whole picture. The price range listed above is dependent on which reports you want to order.
The report most use is the PAYDEX. This is likely because it is the easiest to understand, due to it being the most like the consumer FICO score. It measures how quickly a customer makes payments and ranges from 1 to 100. Scores of 70 or higher is acceptable. For example, a score of 100 shows payments are made in advance, and a score of 1 indicates that they are 120 days late, or more.
Hit the jackpot with our best webinar and its trustworthy list of seven vendors who can help you build business credit.
The delinquency predictor score measures how likely it is that the company will not pay, will be late paying, or will fall into bankruptcy. The scale is 1 to 5, and a 2 is good.
The financial stress score is measures pressure on the balance sheet. It shows how likely the company is to shut down within a year. These scores range from 5 to 1, with a score of 2 being “good.”
This rating ranks the odds of a company surviving 12 months. The minimum score is a 9 and the maximum is 1. A “good” score is 5.
The credit limit recommendation reflects a business’s borrowing capacity. It is a recommendation for how much debt a company can handle. Typically, creditors use this to determine how much credit to extend.
This one ranks overall business risk on a scale of one to four. A score of 2 is good. The rating is given in conjunction with letters, the combination of which indicate a company’s net worth.
Even if there isn’t enough information on a business to assign a regular rating, Dun and Bradstreet will assign what they call a Credit Appraisal Score. This is based on number of employees. Another option is an alternative rating based on what data is actually available.
Experian’s uses what it calls Intelliscore as its credit ranking. There are more than 800 different factors that they use to predict a company’s credit risk. With Intelliscore, a score of 76 or higher indicates a low risk of default or late payment. If a score falls between 51 to 75, it indicates a low to medium risk. Scores from 26 to 50 are medium risk, and from 25 down to 1 is medium high to high risk.
Here is where Experian gets tricky. Intelliscore is a blended score of both the business and business owner’s personal information. That means it offers insights into a business’s public record findings, collections, and payment trends, as well as overall business background. Experian is also unique in that it does not ask businesses to self-report. Instead, they collect all the information themselves. You will have to give permission for a lender to view this report, due to it containing personal information.
Equifax collects information similar to Dun and Bradstreet, including: information from public records, financial data from the business, and payment history from creditors. Credit utilization is also a factor, which accounts for how much credit you are using versus the amount of credit you have available to use.
The information is used to calculate various scores, including the business credit risk score and the business failure score. The first measures how likely it is that a business will become 90 days or more delinquent on bills over the next year. The score ranges from 101 to 992. The second ranges from 1,000 to 1610 and predicts how likely it is that the business will file for bankruptcy over the next 12-month period. A lower score indicates higher risk.
They also calculate what they call the business payment index. This is the Equifax version of Dun & Bradstreet’s PAYDEX. It even runs on the same scale of 0 to 100. This is an indicator payment history over the past year. It is different from the PAYDEX, however, in that you must to reach a score of 90 or higher for it to be a “good” score.
In addition, Equifax offers business identity reports to confirm a company actually exists. It verifies details such as the company’s tax ID, number of employees, and yearly sales.
Equifax does not allow business owners to request reports on their own company. They decide themselves when to start a credit file on a specific company.
CreditSafe offers reporting options based on your Dun & Bradstreet score. They offer 3 packages, Standard, Plus, and Premier. The problem is, they do not list their prices on their website. You have to request a quote to determine what your pricing would be, as they also allow you to purchase individual products as well.
Since their reporting is based on information from Dun & Bradstreet, they are not technically a credit reporting agency themselves. However, since they do have their own reports, they are a little different from a straightforward credit monitoring company as well. They are quickly growing in popularity. No doubt that is partly due to the subscription service it offers, which allows easy insight into your own company’s credit report. The free trial allows for test driving, which sweetens the deal even more.
Their main score, the CreditSafe rating, works on a scale of 1-100. It predicts the likelihood that payment performance will become 90 plus days beyond terms within the next 12 months or that the business will go bankrupt. They offer a variety of other scores and reports that provide a ton of information however.
This score is derived from the Creditsafe rating. It allows for a comparison of credit risk between companies that are registered in different countries.
The Creditsafe recommended credit limit uses information from the business payment records and those of similar companies to calculate a dollar amount recommendation of the maximum amount of credit a company should receive at any one time.
Compares how many days late a business pays its bills in comparison to other companies in the industry.
This is a report on the number and value of tax liens and judgements that have been filed in the past 6 years and 9 months. It also includes bankruptcies filed in the last 9 years and 9 months
A report designed to highlight at a glance substantial changes in how a company is paying its bills.
Let’s you know whether the total annual business spending is going up or down when compared to the previous year.
Subscription packages come in levels, and the prices are dependent completely on your business’s individual needs. You will have to speak to a consultant to get a quote.
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It’s true, a solid business credit score does not always indicate a healthy bottom line. What it does indicate, however, is the propensity for growth. If your business credit reports don’t look so hot, you are going to have a hard time getting funding to expand and grow. Stagnant businesses are doomed to die, meaning your business credit reports could very likely be your lifeline. Knowing how to access them for free is important. However, it is important enough to know what is on your business credit reports that for most, they are actually worth paying for.
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And How to Understand Your Score Most people know they have a personal credit score. Many business owners do not know, however, that they may have a business credit score. This is a score very similar to your personal FICO, but it is related to your business financial transactions only. It is not connected to … Continue reading How to Get and Read Your FREE Business Credit Reports and Understand Your Score