Financial Solution of Business Franchise

The credit score most commonly a franchisor will look at is called the FICO score. The system was developed by Fair Isaac Corporation FICO and moved to the public in 1987. The score is determined by a number of things, including (without limitation): credit history, loan payments, bankruptcies, “pings” your account from the account activation, changes address, etc. FICO scores range from 300 to 850, all below 600 is considered below average. The higher your credit score, the more likely you are a loan franchise.

The heaviest weighted figures for a FICO score include payment history, length of time with a credit card, credit types (white / L), the number of credit applications, and your use of the overall credit (how much of your available credit is actually used). A general rule does not exceed 30% of your available credit to use and pay in full when an invoice is received.

Credit reports can be obtained from one of the three major credit bureaus in the United States: Equifax, TransUnion and Experian. A free credit report can be made once a year for each of the three agencies. Follow the evolution of information and ensure that your report is accurate and current. Credit reports, some of the following: name, address, account balances, bonds, bank accounts, mortgages, liens, charges offs, payment, and accounts of the collection.

Increasing your credit score:

Obtain a copy of your report

Make sure you get a copy of all three credit bureaus, because they all have conflicting information. A good idea is to prepare a report every four months, this way you will keep your credit record for years, instead of once a year. Review the report and found inconsistencies. If you find errors, please contact the office and have them corrected immediately. Errors on your credit report can have side effects.
Pay your bills and pay on time

Make sure that each invoice is booked and paid. If possible, pay more than the minimum balance. Late payments can remain on your report for seven years from the date indicated. All credit-offs or privileges also negatively affect your credit rating overall.
Less is more-

Just because you are approved for 10 credit cards this month does not mean you should get them. Stick with 2 or 3 and use less than 30% of the credit allowed. If you are responsible to cover it. This tactic will improve your credit score because it shows that you are in charge of your finances and money to pay for the use of credit. In addition, will be making minimum payments poor reflection on your overall credit rating.
Types of credit / Ping

Another factor in your credit score is your mix of credit. The FICO score examines what type of accounts you have open. Try the types of credit you have open mix, such as car loans, mortgages, credit cards, student loans. Keep applications up to a minimum. Each time you submit an application, a “ping” will appear on your credit report. Too many of these pings on your credit report can hurt your score.
Franchise Loans:

Franchising can be a very profitable once you’re approved for financing a loan. Follow the advice above and make sure you know what your credit report looks like. Qualify for loans in this economy is more than ever, but not impossible. Take time to your finances right, and a score well above the 600 have.

Once you find a franchise that interest you, the franchisor to discuss funding. Some companies have in-house financing systems that are easier to qualify for. Bank loans to businesses are often more difficult to obtain, but you’re ready and I know that your credit report, like the back of your hand.

Monday, October 3rd, 2011 Small Business

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