Navigating Credit Scores for Small Business Loans
Differentiating personal and business credit
Personal credit and business credit are two distinct entities used to assess a person's or a business's creditworthiness. Personal credit is based on an individual's credit history and financial behavior, while business credit is based on a business's financial health and payment history.
When applying for a small business loan, personal and business credit are important factors that lenders consider, including Community Development Financial Institutions (CDFI). While a strong business credit score can demonstrate the business's financial stability, personal credit scores are also considered because they provide insight into the individual's ability to repay the loan.
CDFI support for boosting credit ahead of a business loan
Benefits of choosing CDFI like Pathway Lending for credit concerns
Working with a CDFI can provide several unique benefits for small business owners seeking financing. One of the main benefits is access to financial education and resources to help small business owners understand and improve their credit scores. We can also offer a more flexible loan process compared to traditional lenders.
Pathway wants to work with small business owners to find a loan solution that meets their specific needs and financial circumstances, even if their credit score is not as high as traditional lenders might require. This means that a low credit score is not a black-and-white decision.
Connect with a Pathway coach for credit and loan guidance
Whether your score is exceptional or needs improvement, talking about it with a financial expert is helpful.
Pathway coaches are experts in their field—former executives, CPAs, and more, with expertise ranging from accounting to sales and marketing. We're ready to help you and your business start and grow!