5 Factors That Affect Your Business Credit

What makes up your business credit score? What gives you the best chances of getting a loan? Here are a few factors that play into your business credit picture, and how you can make the most of them:

1. Payment History
This is an important part of your business credit profile. It is the basis of your D&B PAYDEX score. Vendors will look at your whole credit picture, and your PAYDEX is a part of that.

2. Blanket UCC Filings
Pay attention to the order in which you get certain types of loans, and which UCC filings the lenders will file. Some lenders may file a blanket UCC filing. This essentially says they have an interest in ALL your assets. These blanket UCC filings will then take precedence over any later ones. This drastically reduces your ability to get credit elsewhere.

What you can do: Plan your credit with care and negotiate UCC filings according to your needs. For example, if you need particular assets excluded from a UCC filing to use as security for another loan, explain that in advance. That way, you can get those items excluded from any blanket filings. Or get the loan or account with the more specific UCC filing first. Some experts recommend opening accounts with competing UCC filings at the same time. And negotiate the details with each party simultaneously.

3. Credit Utilization (Debt Load)
This factor looks at how much of your available credit you're currently using. If your business is maxing out its credit lines or carrying high balances compared to its limits, lenders may see you as a risk. High utilization can lower your business credit score and signal financial strain.
What you can do: Try to keep your credit utilization low—ideally under 30% of your available credit. Regularly pay down balances and avoid overextending your business with excessive debt. Managing your debt responsibly demonstrates to lenders that you can handle credit effectively.

4. Company Financials
With D&B, it’s important to make sure your financials in your credit file are up to date. If they are not, it could negatively reflect on your company when the lender compares available data.
What you can do: Update your financials on your credit reports. Make sure they reflect your current circumstances. And plan to update often.

5. Company Legal Structure
Having an LLC or corporation versus partnership, etc., can also affect business credit. Lenders are less likely to loan money to sole proprietorships and partnerships. They prefer corporations and limited liability companies. So, if you aren’t incorporated, you should be. The advantages go far past your ability to get credit.

There are other factors affecting your ability to get credit, like the amount of debt you already have and how heavily invested you are in your company.

Even your personal credit can play a role in your approval or denial. Here we’ve covered five of them. The better the all-around picture you can paint, the better your chances of getting loan approvals.

Building strong business credit isn’t just about one factor—it’s the combination of many that paints the full picture for lenders and creditors. By understanding and actively managing these five critical areas, you can significantly improve your chances of securing funding, scaling your business, and protecting your personal credit in the process.

Ready to take the next step toward a healthier business credit profile?

👉 Visit our website at expertbusinessadvisors.org to learn more, get your Free Fundability Scan, and explore funding opportunities designed for businesses like yours.