5 Tips to Improve Your Business Credit Score Before Applying for a Loan

Your business credit score is one of the most important factors lenders consider when you apply for a loan. A higher score means better rates, larger loan amounts, and more lender options.

Why Business Credit Matters

Business credit scores (from agencies like Dun & Bradstreet, Experian Business, and Equifax Business) range from 0–100. A score of 75+ is generally considered good, while 80+ is excellent.

Unlike personal credit, business credit scores are built through your business's financial behavior — and you have more control over improving them than you might think.

1. Establish a Separate Business Entity

If you're operating as a sole proprietor, your personal and business credit are intertwined. Forming an LLC or corporation separates the two and allows you to build an independent business credit profile.

Action steps:

• Register your business as an LLC or corporation
• Obtain a federal Employer Identification Number (EIN)
• Open a business bank account

2. Get a DUNS Number

A DUNS number is a unique nine-digit identifier from Dun & Bradstreet. It's free to obtain and is required for building a business credit file with D&B.

Action steps:

• Apply at the Dun & Bradstreet website
• Use your EIN and business information consistently across all applications

3. Open Trade Lines with Vendors

Many suppliers and vendors offer net-30 or net-60 payment terms. These trade lines report your payment history to business credit bureaus, which helps build your credit profile.

Action steps:

• Ask your current suppliers if they report to credit bureaus
• Apply for net-30 accounts with office supply, hardware, or inventory vendors
• Always pay on time or early — payment history is the biggest factor in your score

4. Pay Bills Early or On Time

Payment history accounts for the largest percentage of your business credit score. Even one late payment can significantly impact your score.

Action steps:

• Set up automatic payments for all business bills
• Pay invoices before the due date when possible — early payments can boost your score
• Monitor your cash flow to ensure you always have funds available

5. Keep Credit Utilization Low

Just like personal credit, using too much of your available credit can lower your score. Keep your credit utilization ratio below 30%.

Action steps:

• Monitor your business credit card balances
• Pay down existing balances before applying for new credit
• Consider requesting credit limit increases to improve your utilization ratio

Monitor Your Business Credit Regularly

Check your business credit reports from all three major bureaus at least once a year. Look for errors or discrepancies and dispute them immediately.

Ready to Apply?

Even with less-than-perfect credit, ASBCLF can help. We work with 75+ lenders, including those who consider the full picture of your business health. Start your application today.