Lender Compliance is a series of items that traditional, affordable lenders like banks and credit unions look for when reviewing your application to help determine your level of risk. This applies to every business, new and well-established. A business who fails to correct any failed compliance items may be categorized as high-risk.
Business Lenders and Creditors pay close attention to the personal credit of the business owner and the credit of the business. Before applying for business financing or credit, it’s important to know what’s being reported about you and your business, and to correct any misinformation being reported.
Even if your business has the resources necessary to operate and produce profits each month, utilizing credit keeps more money in your bank account for longer periods of time. Your business can benefit from the additional cash on hand, especially when you consider expansion or applying for a loan. Banks lend more money when you have money.
As a small business owner, it’s not uncommon to be turned down for a bank loan. There are plenty of alternative financing sources available to business owners who need cash now. However, alternative financing sources are very expensive and should not be your long-term financing game plan. These can be great loans if they are used short term-while you build your lender compliance and personal and business credit profiles.