Merchant Advance Blog

Blog Article: Bad Credit Score and Business Loans

Business financing can be a headache for any small business owner, and choosing the best financial option for your business can be intimidating. At Merchant Advance Capital, our applicants often ask us about personal credit and the importance of maintaining a good score.

We’re proud to offer alternative business funding to Canadian merchants, as our flexible financing program is able to accommodate many business owners who have less than perfect credit and who may have been denied by traditional banking institutions.

For the benefit of our merchants and applicants, we’ve scoured the web in order to compile some helpful tips for maintaining a healthy credit score!

 1. Do Some Homework

Knowing how a credit score is determined is the first step in knowing how to maintain a good one. If you aren’t educated about the factors that affect your credit, you should be. There are many myths about credit score influencers that shouldn’t be taken into account when considering personal credit. For example, checking on utility payments won’t make a difference in your credit score. Things that will make a difference include your payment histories, level of debt, and the length of your credit history. Good credit is based on credit activity in general, so accumulating credit responsibly at a young age is beneficial. Just remember to pay down those credit cards each month!

 2. Pay Your Bills On Time

Any and all bills that you receive need to be processed and paid. This includes personal and household bills, and any others that you may accumulate. Falling behind on these payments reflects poorly on your credit score, and will tarnish your record even if you pay them down the road. Paying bills late is better than not paying at all, so make sure to keep track of invoices and ensure that payments are being made regularly.

 3. Keep Balances Low

A healthy credit score will often reflect numerous lines of credit, all of which will credit cardshave low balances. By assessing invoices regularly, you can determine the best way to cycle through credit cards and figure out where the repayments should be allocated first. It’s simple: The higher your credit card balance is, the worse your credit score will be. Keeping those balances low will indicate that you’re truly invested in preserving your credit through responsible spending habits.

 4. Be Sparing with New Credit

There’s a fine balance between too much credit and not enough. While balancing several lines of credit/loans can be beneficial to your score, each time you apply for additional credit your score will take a hit. It’s difficult to avoid and isn’t going to influence your credit in the long run, but it’s good to be aware of the process.

 We hope our tips have been helpful in gaining some insight into the world of personal credit scores! If you have further inquiries about your credit and the merchant advance application process, please do not hesitate to call one of our client reps at 1 866 240 3694. 

We’d love to hear from you!

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David Gens

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