Can I Use My Personal Credit Score To Apply For a Business Loan? - The answer to this question depends on the type of business loan you are applying for. Some business loans require a personal credit score and a personal guarantee, while others do not.
Here are some examples of business loans that may or may not affect your personal credit:
- Traditional Bank Loans and SBA Loans: These loans usually require a personal credit score of 680 or higher, and a personal guarantee from the business owner. This means that your personal credit will be checked during the application process, and you will be legally responsible for repaying the loan if your business fails.
- Invoice Factoring: This type of financing lets you use your unpaid business invoices as collateral for a loan, and does not require a personal credit check or a personal guarantee. However, you may have to pay higher fees and interest rates than other types of loans.
- Corporate Credit Cards: These are credit cards that are issued to your business entity, and do not require a personal credit check or a personal guarantee. However, you may need to have a strong business credit score and a certain level of annual revenue to qualify for them.
To find out more about the different types of business loans and their credit requirements, you can use a loan comparison tool or consult a financial advisor. You can also use a loan payoff calculator to estimate your monthly payments and interest costs for any loan you are considering.
use a loan payoff calculator to estimate your monthly payments and interest costs for any loan you are considering.