What is a FICO score?
Your FICO score is a numbering system created as a result of your personal credit worthiness based on your past and present usage of credit. Any score above a 680 will easily qualify you for business financing. With a score above 640 there will be some creative funding programs available to you; and with a score below 620 you will most likely need to find someone other than yourself to act as a guarantor for business funding, unless your business has assets or receivables to secure the financing.
For example, your guarantor could have a FICO score of 720 when it is calculated from the Equifax report and a 690 when it is calculated from Trans Union. Most business funding sources use the FICO score(s) as a "Go", "No Go" switch. It is important to know your Guarantor's FICO scores from all three (3) credit agencies before you apply for a business loan.
Next you need to know if your business has a "Business Credit Profile" and a PayDex score. A PayDex score is similar to a FICO score only it is the measure of your business credit worthiness. I will explain it in further detail later.
Having a PayDex score of 75 is like having a FICO score of 750. Go to http://www.dnb.com to find out if your business is already listed and has a PayDex score.
Click here to understand exactly what a Paydex score is.
