Company Credit Report

Everyone knows about the Personal Credit Report but SBA and some banks are now running a Company Credit Report. The regular Personal Credit Report, reports on your credit with what you pay currently on your accounts that report to the major credit agencies. These agencies are TransUnion, Equifax and Experian. Banks do not have to report, but if they do, they must agree to certain standards of recording and transferring information. Banks report Personal Credit and do not report Business Credit. Now if you are a Sole Proprietorship and you “are” the business then they will report all of your loans. It really depends – is it in a personal name or a business name?This is another reason to get the business to have its own entity so to speak, like a LLC or a Corporation or Partnership, that has it’s own Tax I.D. Number or TIN. If you are using you name and your Social Security Number then they will report your loans on the Personal Credit Report.

Your probably thinking, if the bank does not report the business credit then what is the report for anyway? Most bankers do not run a Business Credit Report because of that very reason. The Business Credit Report will pick up Bankruptcies, Liens, and Judgements. The Business Credit Reporting Agency will say they monitor the suppliers of the companies but most of this info is obtained from the company they are reporting on, such as the company’s suppliers. Most company’s will not give a name of a supplier, that they do not pay promptly. Dun and Bradstreet use to be a good source of  info but most bankers used it to see the background of the company, which was usually reliable. Most bankers did not trust the trade information or any credit scores given by the credit company reporting on a business.

This is the Computer Age and if you do not show up on a Google Search, you do not exist! These Business Credit Reporting Agencies constantly troll the Government Informational sites that report Bankruptcies, Liens and Judgements. This information if fairly easy to obtain and it is usually accurate to a degree. The last one I looked at had negative information from a Tax Lien filed several years ago and also showed that the lien was released, but the company still had a very negative Credit Score.

In summary, take Liens and Judgements very seriously and get them dismissed or released before they cause major problems. Most banks do not run a company credit report but SBA does run one on any company using their loan programs. Remember the Company Credit Report only picks up Bankruptcies, Liens, and Judgements. They can use supplier information but those referrals are given to the reporting agency by the company being reported on. Most banks do not worry about Liens and Judgements as long as they are Released or Dismissed. Tax Liens can take precedence over company assets and Banks do not like loosing collateral to the government.

This is a brief overview of the Company Credit Report. Please email me if you have any questions or comments at roger@rogerschlueter.com and please also see my website at www.schlueterfinancial.com for more contact information.