Delray Beach, FL (PRWEB) May 10, 2010
As individuals find themselves victims of layoffs due to the struggling economy, many have used this situation as the opportunity they needed to start the business of which they’ve always dreamed. NationalCreditReport.com, a leader in credit monitoring services and a provider of personal credit reports, helps consumers understand how a business owner’s personal credit score can affect their ability to get small business funding.
“The job market is suffering due to the current economic situation and many people who have lost jobs are now dealing with late payments on their debts,” said Samuel S. Ambrose, Vice President of Marketing and Operations for NationalCreditReport.com. “People are out of work and want to start their own business, but might ask ‘Can I get a business loan with bad personal credit?’”
Unfortunately, when lack of income causes payments to be late, your personal credit report is affected. According to Ambrose, a common mistake people make when starting their own businesses is trying to fund it through personal lines of credit. A better option is to apply for a Tax ID for the business so credit can be built in the name of the corporation or LLC without being hindered by the business owner’s personal credit score.
Additionally, whereas monitoring your own credit does not lower your score, multiple inquiries by lending institutions and additional credit commitments, even if they are for a business, can lower the business owner’s personal credit score. It’s better to keep personal and business finances separate whenever possible, said Ambrose.
“Although those aspiring to start their own business apply for business loans, a drop in the score on their personal credit report could mean a lack of funding from lenders because they may check the business owner’s personal credit score to see how they manage their finances,” said Ambrose.
NationalCreditReport.com advises those wondering if they can get a business loan with bad personal credit, that a good first step would be to request their personal credit report and check it for any inaccuracies to begin raising their credit score.
Since 2004, NationalCreditReport.com has specialized in providing online personal credit reports and credit monitoring services to consumers to help them understand their credit report and score. NationalCreditReport.com encourages consumers to check their credit report on a regular basis.