These helpful tips on what to do before applying for small business credit come from American Express Open.
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Getting Credit If You Own a Small Business
It's best to get organized before you apply for small business credit. Doing so will increase the chances that you'll gain access to credit.
Before applying for credit, be sure to do the following:
- Clean up financials - Review credit bureau reports regularly and verify that all accounts and credit balances are in line with internal records. Make financial statements as transparent as possible to share with banks and issuers. Financials can be prepared internally, but consider having them certified and validated by an accountant.
- Don't apply for too much credit - In any credit environment, too many credit requests can lower a credit score and negatively impact the ability to access credit. Personal and business credit is related, and both should be managed carefully.
- Register the business - Make it easy for card issuers to confirm that the business is an established enterprise by registering with commercial bureaus like Dun and Bradstreet and the Small Business Financial Exchange.
- Keep licenses current - If a business license has lapsed, an issuer or bank could question the viability or future of the business. Making sure the business is insured and bonded can also indicate a healthy business that expects more clients and/or projects.