A business credit bureau is an agency that collects and researches data on businesses and sells it for a fee to lenders and credit issuers to make lending decisions. It may also be called a commercial business credit reporting agency, or a corporate credit bureau. 

A business credit history is the number of trade payment experiences which are reported on business credit reports. This includes payment terms.

Establishing business tradelines is the act of applying to and using accounts that report to the business credit bureaus.

A business credit profile is all the information included on all your business credit reports including all your business tradelines, business information, and business credit scores. Building your business credit profile means to improve accuracy and accumulate positive experiences and information which present your business in a favorable light.

A personal guarantee is an individual’s legal promise to repay credit issued to a business where they are an owner, executive, or a partner.

With business credit agreements, giving a personal guarantee essentially makes you a co-signer on the business credit account. You will remain liable for any debts the business incurs. You have given a “personal guarantee” that you will be responsible for the debt.

In practice, this means that your personal credit will undergo a hard inquiry, since you are putting your Social Security number on the credit application. With enough hard inquiries, your personal credit score will be adversely affected.

A trade vendor is a vendor that issues trade credit, and trades product or services.

Trade credit is issued by vendors to businesses for the purchase of goods or services.

A vendor account is an account issued to a business with a vendor. It is sometimes reported to the business credit bureaus. The term trade account is common, but it is more accurate to call this account a vendor account.

Business tradelines are vendor accounts reported by the vendor to a business credit bureau. This information is included in a specific location in a business credit report.

When a businesses’ payment activity in relation to a new or continuously reported tradeline is recorded by a business credit bureau.

A continuously reported business tradeline is one that is over 6 months old that has reported multiple payment experiences.

A business tradeline is referred to as newly reported if it is up to 6 months old and has reported payment experiences.

EIN stands for Employer Identification Number. It is a nine-digit number assigned by the IRS, used to identify the tax accounts of employers and certain others with no employees. The IRS uses the number to identify taxpayers who are required to file various business tax returns. EINs are used by employers, sole proprietors, corporations, partnerships, nonprofit associations, trusts, estates of decedents, government agencies, certain individuals, and other business entities. Get your EIN for free directly from the IRS.

You may be wondering: do business credit inquiries hurt my credit? Unlike with personal credit, anyone can pull your business credit reports. This does result in inquiries.

However, unlike with personal credit, business credit inquiries don’t negatively affect your Fundability or business credit scores with each business credit bureau.

Business credit tiers are actually Credit Suite terminology. Our business credit advisors continually check and recheck vendors and other credit and business financing issuers. There are differences in terms of how easy or difficult it is to be accepted for credit, and what you may need to provide to qualify.

For example, business credit tier 1 is vendor credit, where you need very little to get started. You can qualify with few payment experiences on your business credit reports. You may be able to qualify with a short time in business, such as six months. Or you may be able to get around certain more stringent requirements by offering a personal guarantee or making a deposit to secure the credit.

And to get to business credit tier 2, you will need to have at least three trade accounts reporting to the business credit bureaus.

When a lending institution has more than just your personal credit scores to look at, they will review any other information which they believe will better answer their one big question: will you pay them back?

Because it’s possible to have good business credit with bad credit on the personal side. But if your business credit is good enough for a lender, they will weigh it more heavily in their decision.

Lending institutions will let your business credit guide them as they pull your business credit reports and look for a few things.

• Do you pay your bills on time?
• Are there a lot of negative/derogatory items on your credit reports, such as lawsuits or liens?
• How long have you been in business?
• Is the business credible?
• Does the information on the business credit report match the information received on the application?

If the answers to these questions satisfy the lending institution, then you’re more likely to get a loan, although it will not necessarily be for exactly the amount you were originally seeking.