Wednesday, September 20, 2017

The Best Quick Trick to Start Building Your Credit Fast

We’re thinking of a number between 300 and 850… and it’s your credit score.

Do you know what it is? And most importantly, is it where you want it to be?

Unless you have an absolutely perfect credit score—850—we’re willing to bet that you’d like to tack on a few points to that three-digit number.

Building credit fast is no easy task. Your credit rating is with you for the long-haul and is built up over years and years of credit history—so it won’t just change overnight.

But there are things you can do to bump up your credit score quickly.

When it comes to building credit fast, here’s what we recommend: credit monitoring.

We strongly believe that the more you know about your credit rating, the better you can take care of it.

Building credit fast is hard, but credit monitoring can help.

Here’s how.

Why You Need to be Monitoring Your Credit

If you’ve ever applied to small business loans before, you know just how crucial your credit score is. It’s probably the single most important piece of information on your business loan application.

And that’s not just for business loans. Your credit rating is considered for any big financial move in your life.

When you’re taking out a mortgage, applying for an automobile loan, getting a credit card, securing a student loan, or even landing your dream job… your credit score matters—a lot.

We could talk about how important your credit score is all day. But it all comes down to this:

Having a great credit score can save you thousands on your personal (and business) finances. On the other hand, black marks on your credit rating can really limit your financial options.

That’s why anyone who’s interested in building credit fast needs to be monitoring their credit score carefully and often.

A Run-Through Of Your Credit Score

Monitoring your credit—and building credit fast—first comes down knowing what actually goes into your credit score.

So here’s a quick credit score refresher:

Your credit score measures how reliable you are with your financial obligations. When a lender, a bank, or even a potential employer looks at your credit score, they’re essentially asking themselves this: “Can I trust you?”

A stellar credit score shows that you’re responsible with your financials and a safe borrower to work with. On the other hand, if your credit score suggests that you often don’t repay what you owe—or you’re always late to repay—lenders are less likely to trust you with their money.

What Goes Into Your Credit Score

There are three main credit reporting bureaus that monitor your personal credit score: Equifax, Experian, and TransUnion.

They each have their own formula for reporting your credit score—and none of them actually tell us what that formula is.

But we have a good idea of what matters and what’s not as important.

Here’s what they pay attention to:

  • Payment history (including bankruptcies and judgments)
  • Amount of debt you have
  • Age of your open credit accounts
  • Diversity of credit accounts
  • Your credit utilization (or how much of your available credit is actually being used)
  • Tax liens
  • Hard credit inquiries

Now that you know what makes up your credit score, you’re ready to monitor your score—and start building credit fast.

Best Practices for Monitoring Your Credit Score

There is no cut-and-dry formula for how you should monitor your credit score.

But when it comes to building credit fast by monitoring your score, here are the steps you can take:

Know Your Credit Report Like the Back of Your Hand

Your credit report is a summary of your borrowing and repayment history—and it’s the backbone of your credit score.

Every piece of information that’s used to calculate your credit score comes from your credit report. So it pays to know and monitor exactly what your creditors are seeing on your credit report.

If your credit report shows that your late bills are weighing your score down the most, then you can put more effort into paying your bills on time. If your report shows that you’re being dinged for having too high a credit utilization, then you can reign in on your usage instead.

All in all, monitoring your credit report keeps you up-to-date on what’s affecting your credit score. By staying on top of your report, you can change your borrowing behavior when any red flags arise.

Building credit fast isn’t easy, but monitoring helps you stay on your toes and make changes in your borrowing habits where necessary.

You of course can’t monitor your credit report if you don’t have access to it. So check out to get your report for free. You’re also entitled to one free credit report once a year from each of the three credit reporting agencies.

Check Your Credit Report For Errors

When it comes to building credit fast, monitoring your report for errors is an easy, effective step you can take to boost your score.

You’d be surprised by how often you can get dinged for things you didn’t actually do. In fact, studies show that 1 out of 5 credit reports contain errors in them. And when those errors were corrected, credit scores increased. (If that’s not evidence of how crucial credit monitoring is to building credit fast, we don’t know what is.)

When you find an error in your credit report, dispute it.

If you’ve never disputed an error on your credit report, here’s how:

Check all three of your credit reports—if an error has popped up on one of them, you’ll want to see what’s going on with the other two. Next, make sure it’s really a mistake. Just because you might be surprised by some negative information on your report doesn’t mean that the information is inaccurate. If the blip on your report did result from a misstep by the credit bureau, now it’s time to gather documentation to prove your case. This could be proof of payment or a correspondence related to the charge in question. You’ll also need to have a copy of your credit report with the disputed charges clearly highlighted.

Once you’ve gathered the documents you need to support your claim, write a letter to the credit bureau reported the error. Check out the Federal Trade Commission’s example of a dispute letter for help. You can also dispute an error on the credit bureau’s website, too. Once you’ve submitted your claim, you should hear back within 30 days.

3 Other Things You Can Do to Build Credit Fast

We stand behind the fact that monitoring your credit is the most effective way to build your credit score. Being able to detect small changes to your credit report (and fixing them if need be) will help you boost your score quickly.

While this is the best “trick” in the books, there are other things you can do to build your credit fast.

Pay Down Your Balance

Of all the factors that make up your credit score, 30% of it comes down to your amounts owed.

But it’s not just how much you owe, it’s more about how much you owe relative to your credit limits (how much you can borrow). So if you’re taking up a lot of your credit limit with high balances, try paying them off.

Say you have a $8,000 credit limit, and you currently have a $4,000 balance on that account. That’s a 50% credit utilization. Best practice is to keep your credit utilization below 30%.

And paying down a balance with high utilization could be the quick boost that you’re looking to have with your credit score.

Get a Credit Card

It may seem obvious, but if you don’t already have a credit card, getting one will help boost your score—fast.

Having one or two cards that you use responsibly can help show that you practice good borrowing behavior—and you’re deserving of a higher credit score.

With that being said, you don’t want to apply for a bunch of credit cards in a short period of time. This is typically an indicator of risky behavior to the credit reporting bureaus.

Pay More Than Once a Month

This tip is especially important if you tend to carry high balances on your credit cards.

You’re told to pay your credit card statements at the end of the month. This is a good practice, but the credit reporting agencies don’t all collect information on your balance on the last day of every month. They can be collecting information throughout the month, when your balance was high (even though you planned on paying it down fully at the end of the month).

This can be risky for borrowers who use more than 30% credit utilization on their accounts.

An easy way to boost your credit fast is to try to pay twice a month so credit reporting agencies aren’t seeing too high of balances on your account.

The Bottom Line on Building Credit Fast

If your credit score isn’t where you want it to be, there’s no overnight solution that can bring it up a notch.

But if you know what’s bringing your credit score down, you’ll know exactly what you need to do to bring it up. And the only way to stay up-to-date on your credit score is to monitor it closely.

Once you make the quick fixes that are hurting your score, you’ll start to see it rise within a few weeks!

The post The Best Quick Trick to Start Building Your Credit Fast appeared first on Fundera Ledger.

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The Best Business Loan Options Depending on Your Credit Score

If you have a business in need of financing you might be wondering: based off my credit score, what kind of loan do I qualify for?

It’s a tricky question. Unfortunately, there are no hard and fast rules when it comes to who qualifies for a loan. Many different factors contribute to your ability to borrow, and it’s not just your credit score. It’s important to understand all loan application processes before you apply to see what’s required of you and what the borrower might ask of you.

The best thing you can do for your business when applying for a loan is to be thoroughly prepared in every way possible. Different lenders require different things, but most will inquire about your business’s annual revenue, reserves, profitability, cash flow, existing debt, and debt history.

That said, some credit scores are better suited to qualify for certain types of loans than others. See our breakdown below.

If You Have Good Credit  

700+: If you have a 700 or above credit score, you’re in a good position to qualify for a business loan with most lenders, including banks. You might even qualify for a coveted long-term loan, which will give you more time to pay off the debt.

However, note that it’s never a done deal. A great credit score will certainly help you, but it’s not a guarantee. Like any financing option, it’s important to understand the business loan application process thoroughly and highlight your business’s other strengths to ensure you can secure the long-term financing.

Term Loan

A term loan is a form of debt that is paid off over an extended time frame that usually exceeds five years. Obtaining a long-term loan provides a business with working capital that they can use to purchase assets, inventory, or equipment that can then be used to create additional income for the business.

650+: If you have a credit score over 650, you might still be able to qualify for long-term business loans, but it will be trickier. Other aspects of your business—such as revenue and growth—will need to also be stellar. The good news is, at a 650 credit score, you might also still qualify for an SBA loan.

SBA Loan

The 7(a) Loan Program is the Small Business Adminstration’s program to help small businesses secure financing for general business purposes. The SBA does not make loans itself but rather guarantees loans for program participants made by participating lending institutions. Taxpayer funds are used in the event of borrower default, which reduces the risk to the lender, thus creating more leniency in the application process in terms of credit scores.

Note that this does not reduce any risk to the borrower, who remains responsible for the full debt, even in the event of default.

If You Have Average Credit

620+: If you have a credit score over 620, you could qualify for a medium-term loan.

Medium-term Loan

Medium-term loans work the same as long-term loans, only with slightly less time to pay off the debt—usually between one to five years. Interest rates will be higher, but you’ll pay off the debt faster.

550+: If you have a credit score between 550 and 620, you could qualify for a short-term loan or potentially a medium-term loan if your business is in a good financial position in other areas.

500+: If you have a credit score between 500 and 550, you’ll have trouble qualifying for long or medium-term loans. However, if your business is doing really well, your low credit score might get canceled out by some other financials. You might want to consider a short-term loan or some of the alternative lending options listed below.

Short-term Loan

A short-term loan is a loan scheduled to be repaid in less than a year. When your business doesn’t qualify for a long or medium-term loan from a bank, you might still have success in obtaining money from them in the form of a one-time, short-term loan to finance your temporary cash needs.

If You Have Poor Credit

500 and below: If you have a poor credit score, you’ll have a very difficult time qualifying for most loans, particularly from banks. Again, if your business is doing extremely well, that might help you in some ways.

Regardless, you’re likely going to need to look to alternative, online lenders to secure financing. Getting financing from a bank unfortunately is highly unlikely—it’s even common for business owners with good credit to get rejected from banks.

But it’s not all bad news—you still have plenty of alternative lending options to consider. Even if you don’t have good credit, these options could be a good fit for your business depending on your needs.

Alternative Lending

Alternative lending is a broad term describing small business lending options available outside traditional banks. With alternative lending, small business owners—with a range of credit scores—can work with online lenders to access a variety of business financing—from those coveted term loans and lines of credit to invoice financing and short-term loans.

Whereas big banks have an approval rating between 13% and 20% over the past five years, alternative lenders have accepted on average between 61% and 64% of small business owners looking for funding. Benefits of alternative lenders include less paperwork, more flexibility, and faster funding, though these might come with slightly higher interest rates.

Business Line of Credit

A business line of credit is a financing option typically used for a business’s short-term cash needs, such as inventory purchases, project costs, or payroll. Lines of credit are primarily used to help even out your cash flow. You’ll want to be careful how much you are borrowing from a credit line, as interest rates tend to be higher, but it’s a great way to get fast cash when you need it.

Asset-based Loans

An asset-based loan is a form of funding that lets you use your company’s assets, such as outstanding invoices, inventory, and machinery, as collateral for a loan. Your assets will be appraised and the loan amount determined based on their worth. If you default on the loan, your assets will be seized by the lender.

Invoice Financing

Invoice financing is a type of asset-based lending that’s great for companies that have a lot of outstanding invoices in accounts receivable. These products allow companies to not have to wait on clients to pay their invoices in order to get the cash they need to run their business.

There are two ways to finance invoices. The first way is through a sale: invoices can be sold to a factoring company in exchange for an immediate payment. The factoring company then is responsible for seeking payment from the client. Factoring is pretty easy to obtain because you are technically selling an asset rather than getting a loan. 

The second route for invoice financing is to use your recurring, outstanding invoices to secure a revolving line of credit through an asset-based loan. The most important requirement to qualify is to have invoices from creditworthy commercial clients. As a result, factoring is available to small businesses that don’t have substantial assets or a long credit history. Both of these options can be obtained through online lenders.

Nonprofit Microloans

A nonprofit microloan is a small sum of money lent at low interest to a business via nonprofit or government organizations. The benefit of a nonprofit microloan is that profit is not the objective of the lender. Many microlenders are “mission-focused” or “mission-based,” meaning they strive to offer loans geared toward helping underserved or economically struggling communities.

Microloans can run up to $50,000 for startups or other small businesses. Plus, many organizations, such as The Small Business Administration or Aspen Institute’s FIELD program, provide pro bono consulting and training to help businesses succeed.

Just know that the application processes for these types of loans can be harrowing, with strict requirements and eligibility factors.

If You Have No Credit

If you’re just starting your business and have no credit associated with that business, you’ll have trouble securing most business related financing. But you still have options.

Personal Loan

It’s common for new small-business owners to access financing through personal loans, often through alternative, online lenders. But like credit cards, personal loans usually have high APRs—sometimes as high as 30%—especially for bad credit borrowers. You will likely need to have good personal credit score.

Consider this a last resort and only if your business just needs a small amount of money to get started—you don’t want any unforeseen business issues to negatively affect your personal credit score long term.


Grants from private foundations and government agencies are another way to raise startup funds for your small business. They’re not always easy to get, but free capital might be worth the hard work for some new businesses. Veterans, minorities, and women have access to specific grants carved out for those groups. You can search small business grants here to see if you’re eligible.


Crowdfunding can go a couple of ways. Well-known peer-to-peer crowdfunding sites such as Kickstarter or Indiegogo let you raise money through public, online campaigns by offering rewards for donations. It’s a great way to test the market for your business and receive feedback along the way. But you might also consider equity crowdfunding, such as First Democracy VC, in which you tap a pool of investors who agree to finance your company in exchange for equity in the business.

As shown, there are many options when it comes to securing financing depending on your credit score. If you have poor credit, there’s still hope. The best way to know if you qualify for any type of loan is simply to apply for it. As always, just be prepared!

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Tuesday, September 19, 2017

How These Amex Business Cards Have Changed the Way We Book Business Travel

The American Express brand has been synonymous with luxury travel for over a hundred years, ever since the company made its name in traveler’s checks back in the 19th century.

Since then, Amex’s influence on travel has persisted, from the 1950 launch of the Diners Club card (one of the first-ever travel charge cards) to the more accessible Gold Card in 1966, to the super-exclusive Amex Platinum, which made its debut in 1984.

Even today, its points cards, airline and hotel loyalty cards, and premium charge cards have drawn the eye of travelers everywhere.

Here are five ways Amex cards have changed how we view travel and travel credit cards.

1. Elite status is much more accessible.

Unless you’re a very frequent business traveler or a huge fan of a particular hotel chain, you probably thought hotel elite status was out of reach. The right Amex card, though, opens a lot of doors. The Business Platinum® Card from American Express OPEN, for example, offers automatic Gold status at Starwood Preferred Guest and Hilton HHonors hotels.

If the Platinum’s $450 sounds daunting (or if you simply prefer loyalty credit cards), check out the Starwood Preferred Guest® Business Credit Card. Its annual fee is $95 (waived the first year) and also comes with SPG Gold Elite status. The card comes with a signup bonus of 25,000 Starpoints when you spend $5,000 in the first three months and comes with access to the Sheraton Club Lounge and bonus rewards for SPG spending.

Alternatively, if you don’t mind using a consumer card for your business needs, the Hilton Honors™ Surpass® Card offers automatic Gold Elite status for a $75 annual fee. You’ll also get 100,000 Hilton Honors points when you spend $3,000 in the first three months, and a free weekend night after your first cardmember anniversary.

Whether with a branded loyalty card or a general travel card, Amex can help you achieve hotel elite status.

2. Airports are kind of awesome.

Gone are the days of arriving at the airport three hours before your flight and spending the next two and a half hours sitting in a hard plastic chair (or chancing a late arrival and missing your flight). The Business Platinum® Card from American Express OPEN offers a respite from the typical pre-boarding experience.

First of all, you’ll get a reimbursement for TSA Precheck or Global Entry, both of which cost $100 and last for five years.

The former lets you skip the line and have a faster screening process on domestic flights, while the latter is a huge timesaver when going through customs (and usually gives the same domestic perks).

And once you’re past security, you can enjoy access to American Express’ network of lounges: Amex Centurion, Amex International, Delta Sky Club, and Priority Pass Select. You can put your feet up, load up on free food and drinks, enjoy fast Wi-Fi, and generally escape the stressed-out airport crowds.

Plus, Amex lounges have really stepped up their dining game. The menu at Dallas-Fort Worth’s lounge comes from Dean Fearing, a James Beard winner; Zagat 30-under-30 winner C├ędric Vongerichten crafted the food served in New York’s La Guardia airport; and San Francisco International Airport’s menu was designed by Daniel Patterson, founder of the two-Michelin star restaurant Coi and a James Beard best regional chef winner.

Between bypassing security lines and getting pampered in lounges, Amex is changing the pre-flight experience.

3. Booking with Amex is worth your while.

Of American Express’ 100+ years of travel perks, this is among the newest.

As of late 2016, Amex Business Platinum cardholders can get 5 points per $1 spent on flights or prepaid hotel stays booked through Amex Travel. You’ll also get an extra 3.5 points for every 10 you redeem with their Pay with Points program toward your preferred airline, or for business or first class travel on any airline (up to 500,000 points per year). Since Membership Rewards Points are valued at 2 cents apiece, your rewards rate on travel booked through Amex is a pretty fantastic 10%.   

You’ll also enjoy a great signup bonus with the Amex Business Platinum: 50,000 points when you spend $10,000 in the first three months of cardmembership, and an extra 25,000 points when you spend an additional $10,000 in the same time period. Whether you transfer your points to one of Amex’s airline or hotel partners, or get the 35% airline bonus when you redeem with Amex Pay with Points, it’s a compelling signup bonus.

4. Airline fees aren’t (as) annoying.

While nothing short of spiritual enlightenment can make you shrug off airline fees entirely, the Amex Business Platinum’s annual $200 airline fee credit comes close.

You’ll automatically get a statement credit for bag fees; in-flight food, drink, and entertainment; and seat booking fees. This perk goes a long way toward offsetting the $450 annual fee, and makes traveling on Spirit, RyanAir, and other budget airlines more appealing.

5. Anyone can get a good travel card.

If you looked at the Amex of 30 years ago, you’d be forgiven for thinking that its offerings were only for the highest of high rollers. But today, even lower-spending businesses and infrequent travelers can get value from an Amex card.

Take, for example, the Blue Business℠ Plus Credit Card: it has no annual fee and comes with 15 months of 0% APR on purchases and transfers. It also earns 2 Membership Rewards Points on every $1 you spend on business purchases and dining up to $50,000 annually, and an unlimited 1 point per $1 thereafter. Since these are full Membership Rewards Points, you can transfer them at a 1:1 rate to Amex’s travel partners, bringing their value up significantly.

Even if you travel infrequently, or don’t want the hassle of an annual fee, you can still take advantage of Amex’s strong travel rewards program.


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Managing Expenses for Your Construction Business in the Winter

In some parts of the country, typical construction work tends to drop off in the fall and not pick up again until the spring. This makes it tough for construction firms that still need to pay overhead and provide an income for employees and owners. How can companies manage to stretch six to nine months... Read more

The post Managing Expenses for Your Construction Business in the Winter appeared first on Kabbage Small Business Blog.

from Kabbage Small Business Blog

Monday, September 18, 2017

What’s Your Credit Score Meaning? We Break It Down Step-by-Step

Three little digits. A simple, seemingly arbitrary number on a page. It’s hard to imagine that a single number—any number—could have such a big impact on your life choices or opportunities.

But when those three digits represent your personal credit score, they can indeed have a dramatic impact on your future choices. Can you buy a house or a car? Can you rent an apartment? Can you take out a personal loan? To a large extent, the answer depends on those three digits of your credit score, so you should probably know your credit score meaning.

Simply put, your personal credit score—also often called your FICO score—is a number between 300 and 850 that indicates to lenders your level of creditworthiness, or whether you are a good candidate for future credit. The number is based on complex calculations that take into account various factors of your borrowing history.

What exactly goes into those calculations, and how are they impacted by your day to day spending habits? We’ll break down all the details below…

But first, you’ll want to understand a bit about FICO and its credit algorithm.

Credit Score Meaning: What is FICO?

FICO is the largest and best-known company for calculating an individual’s personal credit score. Though FICO isn’t an abbreviation anymore, the name does come from the longer, original company name Fair Isaac Corporation.

Here’s where people often get confused:

FICO isn’t actually a credit reporting agency.

Instead, they’re a predictive analytics company that created the algorithm most widely used by lenders to understand how likely you are to pay back a bill on time. Using the information found in credit reports from the three main U.S. Credit Bureaus, often called the main credit reporting agencies—Equifax, Experian, and TransUnion—FICO’s algorithm assigns each individual a number between 300 and 850 that labels the individual’s risk to a lender based on their past credit habits.

And one more important part of your credit score meaning:

As you probably already know, your FICO credit score is a dynamic, “living” number. It changes as your habits and life circumstances do. Each time you check your credit score, you could have a different (hopefully higher) number than before.

The FICO Algorithm & Your Credit Score Meaning

Technically, a FICO score is made up of 12 different scorecards.

Consumers are segmented into different categories, because a slightly different equation is used for each segment.

For example, there’s a particular scorecard for individuals with late payment histories and a separate card for individuals whose credit history is less than a year.

But while every individual’s profile is different, the goal of the FICO algorithm (and your credit score meaning) is always the same: the algorithm’s intention is to predict your relative likelihood of defaulting on a debt within the next 18 months.

The breakdown of how a FICO credit score is calculated for the average person is also more or less the same—or similar enough that FICO has shared a percentage breakdown for the average borrower.


Your score is decided based on your payment history, amounts owed, length of credit history, new credit, and the mix of credit you use.

But what exactly do each of these categories mean—and how do they reflect your ongoing habits as a borrower? How can understanding these factors help you understand your credit score meaning?

Let’s dive a little further into each one now, starting with the largest category.

Payment History (35%)

Not surprisingly, your payment history is the biggest factor used to calculate your credit score by FICO.

After all, your recurring habits for paying off debt in the past is the most telling sign of how you’ll pay back future lenders. (The proof is in the pudding, as they say!)

Naturally, an on-time payment history is good—and the more credit lines you have with a consistently on-time payment history, the better your score will be.

But what if your payment schedule has been less than perfect? Will one bad season of spending haunt you forever?

The algorithm factors in more than simply whether or not you pay your bills, thankfully. Both severity—how far delinquent you are—and frequency—how many times you were late—impact the payment history section of your credit score. In addition, when the delinquency occurred matters.

Late payment histories are bad, but the later they are, the worse it will reflect on your score. The first level of delinquency to impact your credit is at 30 days late. It’s not good, but 60 days is worse, and 90 days is even worse… And so on and so forth.

In addition, being currently delinquent is worse than being delinquent in the past—so, for example, being 30 days delinquent as we speak will have a more negative impact on your current score than being 60 days late on a payment four years ago.

This is a small silver lining for late payers:

Even if you showcased bad habits in the past, the more you make an effort to pay your debt on time going forward, the more you’ll slowly start to boost your score again. And eventually, negative payment history ages off your file. It will no longer appear on your credit report 7 years after the first date of delinquency.

Amount Owed (30%)

You probably guessed that this category reflects total amount of credit you currently owe—or have outstanding. But in addition, and more importantly, amount owed also reflects the ratio of your current outstanding debt relative to your credit limit. In terms of your credit score meaning, this is a big factor.

To better explain amount owed, we’ll need to review the two types of of credit contracts: installment and revolving.

An installment credit account is a closed-end loan with specific payment terms—like a car loan, student loan, traditional term business loan, or mortgage.

For example, let’s imagine that you take out a 5 year car loan with 60 payments.

When you first open the loan and are making your first few payments, your utilization ratio (or your ratio of amount owed) will be very high. Closer to the end of the 5 years, on the other hand, your utilization rate will be much lower, because you’ll have made the majority of payments back to the lender. Essentially, your utilization ratio on an installment credit contract decreases incrementally over the life of the loan.

For the purposes of your FICO score, your utilization rate on installment credit is generally less significant than your revolving utilization ratio. Revolving credit accounts are any in which you have a set borrowing limit, but can repeatedly borrow and repay funds within that limit. (Like a line of credit, for example.)

For example, imagine you have a credit card with a $10,000 limit. If you spend $5,000 and that’s what is reported to the bureaus, you have a 50% utilization ratio. Maybe you pay back $1,000 of that amount and now your utilization ratio is 40%. It’s easy to see how—if your spending continues to outpace your payments—your utilization ratio could skyrocket quickly.

Individuals with high levels of revolving credit utilization are the targets of the FICO algorithm, because they’re statistically most likely to default on a payment.

Borrowers with high levels of revolving utilization are basically financing their lifestyles with very expensive debt, since carrying a balance month to month means paying very high interest rates. These are typically individuals living paycheck to paycheck, so they have little if any wiggle room in their personal finances.

Sadly, what inevitably happens in many of these scenarios is that the borrower encounters either an unexpected expense or a loss of income, and next thing they know, they’re behind on a payment. With so little cushion, one mistake or surprise can cost a lot.

In terms of credit score meaning, amounts owed is important because it identifies those people without enough flexibility who are just one little slip—a car repair, a medical expense, a temporary disability—away from becoming a delinquent borrower.

When you have revolving credit, it’s best to keep your credit utilization ratio below 30% at any given time—if you can afford it.

This means that, if you have a $10,000 credit limit, keeping your utilization below $3,000 on your account will help you avoid hits to your credit score on the amounts owed front.

If you’re having a hard time keeping your accounts at a reasonable utilization ratio, consider contacting your revolving credit issuer to request an increase on your credit limit. This will give you more breathing room with your total available credit, helping you manage your credit utilization ratio.

But it’s also important to note that you want to keep your utilization above 0%. If it looks as though you’re not using the accounts you’ve opened, your lack of credit utilization could end up hurting your credit score in the end.

It might seem like a delicate game of balance when it comes to amounts owed, but it doesn’t have to be that complicated: try to stay below the 30% threshold.

Length of Credit History (15%)

Would you lend money to someone you just met?

Probably not.

And that’s the same logic that FICO, the credit bureaus, and ultimately lenders use in considering length of credit history as a factor in your overall credit score meaning.

When you take out your first credit card, car loan, or student loan, FICO and the credit bureaus are on the edge of their seats, waiting to see what kind of borrower you will be:

Will you make your payments on time, every time? Will you budget and plan ahead for upcoming payments? Will you be a transactor—paying your credit card bill in full every time? Or a revolver—getting closer and closer to your credit limit while making only minimum payments?

In the beginning, FICO doesn’t have those answers, so their algorithm just doesn’t have much to go on. Your credit score meaning is based on only a sliver of data.

From a statistical perspective, the more data points FICO has—think types of credit, months and years of payments made or not made on time—the more confident their algorithm can be about its overall prediction of your future behavior. So if you only have 6 months of credit history, there’s just not a lot for the algorithm to work with.

Because of this category, new borrowers will often have a lower credit score for a year or two after opening their first account, at least until they gather a longer payment history.

The good news?

In this category at least, your credit score will keep going up the longer you’re listed as a borrower.

That said, your length of credit history is ultimately an average—so, in some cases, it can be brought back down by FICO’s next category.

New Credit (10%)

Of course, we all know that our credit scores—and our lives in general—are not as simple as a single account opened or a single line of credit.

As life goes on, you’ll have multiple lines of credit opening and closing. You buy a new car or house. Open a new credit card. Take out a new student loan on behalf of your college-aged child. Chances are good that, every couple of years, you’ll be taking on some form of new credit.

On the other hand, if someone just recently took out 5 new borrowing accounts, that would drive their average length of history down.

Because FICO hasn’t seen a lengthy borrowing history on those accounts, it’s hard for them to predict their trajectories into the future. The equation just isn’t sure that the person has established that they can handle all of this new borrowing.

You might be thinking that these two categories—length of borrowing history and new credit—sound pretty similar.

It’s true that they’re intertwined in many ways, but the main difference between the two is that new credit factors in credit inquiries.

Let’s explain:

Every time you submit an application for a new credit account—whether it’s to open a new credit card, rent an apartment, buy a car, or take out a personal or business loan—the lender you’ve applied to is going to pull your credit report with at least one, if not multiple, credit bureaus.

And when they do, only the first inquiry will be logged—which is why it’s often recommended that, if you’re shopping around for the best deal, you do so within a short span of time so it only impacts your credit rating once.

A new account is always preceded by an inquiry, and it tells FICO’s algorithm that you’ll probably be borrowing more money soon. FICO’s algorithm can’t yet track a payment history for that new account, but it’ll eventually impact your credit score. If you check your credit score very regularly, you’d probably see it go down just slightly after an inquiry, and even more so right after you open that new account. But eventually, after one month, three months, six months, and a year of positive payment history on that account, the negative impact on your score go away.

The bottom line:

Both on individual accounts and with your credit life in general, the longer you’ve shown a positive payment history, the more confident the equation will be. This is a fundamental rule of your credit score meaning.

Mix of Types of Credit Used (10%)

Imagine that a friend from work asked to borrow money from you. The colleague seems like a pretty nice person day-to-day, but you only know them in the context of work. You’ve never met their family. You don’t know anything about their personal life.  Maybe you’re not even sure why they need the cash.

Do you really feel comfortable lending them money?

By contrast, imagine if that friend from work also lived in your neighborhood and attended the same volunteer group as you, so you knew their family well and interacted with them all the time outside of work. Wouldn’t that make you a bit more comfortable with the idea?

This is exactly the same concept that leads FICO and the credit bureaus to include what’s called your “credit mix” or “account mix” as a factor in their scoring algorithm: diversity of context matters for your credit score meaning. The equation wants to see how you handle different types of credit accounts.

To better understand this, let’s track back to the two types of accounts we discussed earlier: revolving accounts (like credit cards and lines of credit) and installment accounts (like car loans, student loans, and mortgages).

Remember, the FICO algorithm’s goal is to predict your future behavior with any type of credit, not just one.

In general, borrowers are much more likely to be late on a credit card payment than they are on a mortgage or car payment. After all, if you miss a few car payments, the lender can take your car away. If you’re severely delinquent on mortgage payments, the bank can repossess your home. If you’re late or fail to pay your credit card bill, there are fewer direct or immediate consequences.

Because of this, your positive payment history on your car loan or mortgage can’t totally reassure lenders that you’d behave the same way with a credit card or revolving line of credit. That’s why the FICO algorithm looks for a mix of credit types, so that it can more accurately predict your future behavior with different types of credit.

Multiple Factors Working Together

At this point, we’ve walked through each of the 5 factors that make up each individual’s FICO credit score.

That said, it’s important to keep in mind that the exact calculations and considerations for each person will look a little bit different: these guidelines aren’t totally scientific.

And remember, there are actually 12 different algorithms that FICO uses depending on population sector, so exactly how each of these categories work together will depend on things like your age, income level, past credit behaviors, and more.

Plus, the FICO algorithm isn’t the only piece of the greater credit score puzzle… We also have to look at the role of the credit bureaus.

Credit Score Meaning: Different Bureaus, Different Ratings… But Why?

If you’ve ever pulled your own credit report before, you might remember that you didn’t do so directly from the FICO corporation. Remember, FICO isn’t a credit reporting agency. They’re just the creator and owner of the statistical model that credit bureaus use to calculate credit scores.

This distinction might seem trivial, but it actually has a significant impact on your final credit score meaning.

While all reputable credit reporting agencies—including the three most widely known: Experian, Equifax, and TransUnion—use the FICO algorithm to calculate your credit score, the exact information that goes into that algorithm can vary widely between agencies.

Each agency has its own proprietary method of collecting information about borrowers, meaning they can gather slightly different information at different times…

Remember when we broke down the various types of credit accounts you might have earlier?

Well, not all of those lenders report to every agency or on the same timeline. To complicate matters even further, the Federal Trade Commission suggests that—because of issues like name changes or similarities, changes of address, and clerical errors—at least 1 out of every 20 consumers is likely to have errors on their credit report.

This is why, despite both using the same algorithm built by the same statisticians, a lender can pull your credit report from two different agencies at the same time and see different scores.

Maximizing Your Score With Smart Credit Choices

Of course, now that you know what goes into your credit score, every borrower’s immediate question is the same:

What can I do to maximize my credit score?

Unfortunately, a lot of the recommendations online that involve “reverse engineering” the FICO algorithm to somehow trick your credit score can often do more harm than good.

That said, there are common sense measure you can take to boost your FICO score. Here are just a few:

1. Get Up-to-Date On Payments

If you’re not current on all your credit accounts, take steps to address that immediately.

Being currently behind on payments is the single biggest factor that will weigh down your credit score, so this one is non-negotiable. Set a budget for yourself and figure out how to take control of your current finances before you consider any new debt.

Your credit score meaning translates into “How reliable of a borrower are you?” If you’re not paying your lenders back, you’re giving a pretty straightforward answer: “I’m not.”

2. Thoroughly Check Your Credit Reports

Are you the 1 in 5 Americans with errors on your consumer credit report?

Without reviewing your report from all three major credit bureaus, you can never really know.

Pull your personal credit report from Experian, Equifax, and TransUnion, and check it thoroughly for any accounts you don’t recognize—or that you might’ve forgotten about.

If you find a delinquent account that’s accurate, take immediate steps to get it paid off. Collections agencies will can sometimes help to ease the burden of added fees if you reach out to them to make a payment.

If, on the other hand, you do find an error on your report, contact the credit bureau in writing to dispute it.

A word of warning: the process of correcting errors on your credit report can be long and arduous—but depending on the charge and your future financial needs, it’s usually worthwhile to get your credit report straightened out.

3. Pay Attention To Your Revolving Utilization Ratio

Even if you’re fully up to date on all accounts, it’s worth paying attention to your utilization ratios—particularly for any credit cards or other revolving credit accounts.

An ideal utilization ratio is below 30%, but the lower the better. Any steps you can take to pay down credit card debts and lower your utilization ratio will be in the best interest of both your credit score and, ultimately, your bank account.


Most of all, it’s important to remember that your FICO credit score is a tool that meant to work for you. Lenders avoid opening accounts with borrowers who have low credit scores because it’s unlikely that those individuals will be able to pay back the funds borrowed.

Your credit score meaning is a way for you to understand whether it’s smart to take on that loan or credit card.

While there might be alternative “quick fixes” that can help you to make small improvements in your credit score, you’re better off focusing on common sense personal finance principles and trusting that, as you get a better handle on your finances, your credit score will increase to reflect those choices. Plus, there are also financing opportunities for individuals with bad credit: use these to build your credit up over time.

Good luck!

The post What’s Your Credit Score Meaning? We Break It Down Step-by-Step appeared first on Fundera Ledger.

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Sunday, September 17, 2017

25 Free Tools to Get Your E-commerce Store Off the Ground

In a perfect world, you’d have an unlimited budget when launching your e-commerce store. You could start out with the best tools, from the highest quality providers, with no regard for their impact on your bank account.

Of course, most of us aren’t that lucky. Rather than being able to splurge on everything that catches our eye, we have to be judicious about where and how we invest our budget.

But just because we have to be careful doesn’t mean we have to give up quality.

Thanks to the following 25 tools, it’s possible to launch an e-commerce business with virtually zero financial investment. And do it well.


Your chosen e-commerce platform is the system that powers your store. Make your decision wisely.

1. WordPress

WordPress isn’t an e-commerce tool itself, but as it’s responsible for 27% of the world’s websites, a number of shopping cart plugins have been developed that’ll turn your blog into a sales engine.

2. WooCommerce

WooCommerce calls itself the “most customizable e-commerce platform for building your online business.” Pay particular attention to the company’s Storefront theme, which can help you get your shop up and running quickly for free.

3. Magento

If your e-commerce needs are more complex than what WordPress or WooCommerce can satisfy, Magento—which bills itself as the “world’s #1 e-commerce solution”—might offer the functionality you need.

4. osCommerce

An open-source e-commerce platform, osCommerce has been around for more than 17 years and boasts more than 20,000 live stores.

If none of these platforms meets your needs, Venture Harbour offers a discussion of paid alternatives, including Shopify, BigCommerce, and Volusion.

E-commerce Tools

Beyond your chosen e-commerce platform, a number of free tools can enhance the usability and performance of your shop.

5. Shopify Free Tools

Though Shopify itself isn’t free, the e-commerce giant offers dozens of free tools to the public—including a logo generator, business name generator, image resizer, and more.

6. Oberlo

Not sure what to stock your store with? Oberlo connects would-be e-commerce sellers with drop-shipped products that make getting started with online selling as hands-off as possible.

7. Aftership

Aftership makes it so e-commerce sellers can provide customers with real-time shipping and delivery updates. Though paid plans are available, the company offers a “forever free” basic plan for merchants shipping fewer than 100 products per month.

8. Responsinator

Mobile-friendliness has become an important ranking factor contributing to your site’s search performance. Check your site’s responsiveness across multiple displays with the free Responsinator tool.

9. SurveyMonkey

In an e-commerce context, customer feedback can be used to inform everything from policies and procedures to future stock decisions. Capture this important insight with SurveyMonkey’s free plan, which lets you gather up to 100 responses per month.

10. Zendesk Chat

63% of customers said they were more likely to return to a website that offers live chat as opposed to one that doesn’t. Zendesk Chat’s “Lite” plan can get you started for free.


Once you’ve built your store and added the necessary tools, it’s time to turn your attention to marketing. The free resources below will help you capture the customers needed to make your site a success.

11. MailChimp

According to VentureBeat, as shared on the Campaign Monitor blog, email marketing generates the highest ROI of all tactics for marketers. Start building your own list with MailChimp’s “Forever Free” plan.


Another email marketing provider worth considering is, whose free plan provides access to some of the more advanced automation workflows excluded from MailChimp’s free offering (though’s free version does stick you with the company’s branding until you upgrade to a paid account).

13. Sumo

Sumo is so much more than an email marketing tool. After installing the system, you’ll also have access to heat mapping, content analytics, image sharing, and other tools—all for free.

14. Buffer

Effective social media marketing requires a consistent, engaging presence. Use Buffer to schedule updates to your social profiles to ensure a steady stream of activity.

15. Canva

Not sure what to fill your social channels with? Free image editing tool Canva can help you quickly create engaging social graphics based on established templates—no matter what your level of design skill might be.

16. Pexels

Pexels is a royalty-free, Creative Commons license-driven collection of stock photography that you can use to build out the pages of your e-commerce store. Just be sure to watch the attribution requirements listed with each image. Failing to follow them properly could result in major copyright infringement penalties.

17. Google Analytics

Get ready to hear a lot about Google, which earned six spots on this list. But what can I say? The search giant’s free tools and services are must-haves for e-commerce merchants.

Start with Google Analytics, which is probably the best free website analytics provider available today. Shopify has a great guide on using it to track e-commerce sales.

18. Google Search Console

Another key Google resource for e-commerce merchants is the Search Console. There, you’ll find warnings about any site issues that could be impacting your search performance, as well as data on your current search rankings, by keyword.

19. Google PageSpeed Insights

Page speed matters, for both SEO and UX reasons. Keep your site humming along smoothly—especially if you’re using a plugin-intensive WordPress e-commerce install, versus a more streamlined platform—with Google’s free PageSpeed Insights testing tool.

20. Google Keyword Planner

You need a Google AdWords account to access this tool (don’t worry—you don’t actually have to run a live campaign), but once you’re inside, the Keyword Planner will give you access to huge amounts of data regarding keyword search volume for the words and phrases your shoppers are using.

21. Google Trends

Whether you’re validating demand for your idea or trying to gauge what will interest your shoppers next, keep your eye on Google Trends to measure consumer interest.


22. Google Alerts

LiveChat Inc. shares the following data, demonstrating the disconnect between customer service expectations and reality:

“According to data collected by Edison Research, at least 39% of people expect responses on social media within one hour, but the average response time from businesses is five hours.”

Some of these mentions will appear directly in your social feeds, while others won’t tag you directly–even if they still call you out by name. Ensure brand mentions online don’t go unnoticed with the free Google Alerts service.

23. Heatmap

The visual display of website engagement shown by heat maps helps reveal structural site issues that may be preventing conversions. Give them a try using’s free version.

24. MozBar

The free MozBar provides a wealth of data, but it’s especially useful for e-commerce sellers as a competitive intelligence tool. Use it to watch changes in the DA of competitors’ individual pages, as well as the keywords associated with their product pages.

25. BuzzSumo

Finally, use the free version of BuzzSumo—a content analytics tool—to identify the subjects your audience is most interested in. Building content around these topics can send a steady stream of new customers your way.

Got another free tool to add to this list? Leave me a comment below with your suggestions.

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Saturday, September 16, 2017

6 Business Loan Scams That Are Completely Avoidable

Over the last several years, the explosive growth of the online alternative lending industry has made it easier than ever for small business owners to access the funds they need to make their business goals a reality.

Unfortunately, though, legitimate and trustworthy online lenders like OnDeck, LendingClub, and Kabbage among others aren’t the only ones using the internet to expand their reach.

Common Business Loan Scams to Avoid

While small business owners have access to plenty of credible and beneficial opportunities for funding online, you do need to stay on guard for some of the less-than-honest, self-described “business lenders” or “loan brokers” whose only real goal is to take your money and run.

Before you sign any questionable contracts or send anyone your hard earned cash, make sure you’re aware of and on guard against these six common—and completely avoidable—business loans scams.

1. Advance Fee Scams

Get a business loan with almost zero interest—no matter your personal credit history, how long you’ve been in business, or whether you have any plan in place to make repayments! Have a bankruptcy on your credit history? It doesn’t matter! According to these supposed loan providers, anyone can qualify for a low-interest loan.

The only catch? There are a few fees they need you to pay up front. A processing fee, an application fee, some kind of premium service….

To put it bluntly, any loan situation that’s asking you to put money down upfront is a scam—plain and simple. You shouldn’t have to pay for a credit check, to hold the offer open, an application or underwriting fee, or any other upfront cost. Lenders who operate above board won’t ask you for a single cent until your loan has been funded. If you’re told otherwise, that’s a red flag that it’s time to move on.

2. Peer Lending Scams

Verified peer-to-peer lending platforms such as LendingClub, Upstart, or StreetShares have become an increasingly popular avenue for business loan funding. Unfortunately, though, these trustworthy P2P sites have been closely followed by other so-called “peer lenders” using less traditional platforms—think Craigslist or Facebook Messenger among others—to take advantage of unsuspecting business owners.

The typical peer lending scam often looks very similar to the advance fee scam described above. The difference is that the solicitation comes from an individual offering a peer loan instead of from a phony business. These peer lenders will usually ask you for some kind of upfront payment to secure your loan—or to conduct a background check.

That means, along with taking your money, these supposed peer lenders could also be requesting sensitive personal data—such as your full name, date of birth, and Social Security number—to complete their phony background checks.

If you fall prey to a peer lending scam, be prepared for this supposed lender to take both your money and your identity to do with as they please. And once they have what they want, you’ll never hear from them again.

To avoid this scam, rely only on reputable peer lending platforms when considering any peer-to-peer borrowing opportunity. Never use a money wiring service like the Western Union for a business loan, and never offer payment up front for any reason.

3. Funding Kits

Some online loan providers would have you believe that obtaining a business loan is so complicated, you need to pay them to walk you through the process! In this case, scammers might be offering you inside tips or tricks to complete your business loan application, obtain special government grants, or qualify for some special low-interest loan product that only they can help you to access.

In reality, any and all information you could need in order to obtain a business loan is readily available online—and for free—from verified online lenders, loan brokers, or marketplaces like Fundera.

Have a specific question that you can’t find an answer to online? Any ethical lender or loan broker is more than happy to answer your questions free of charge, providing you whatever information you might need in order to make the right borrowing decision for your business.

Anyone asking you to pay for information on obtaining a business loan is simply taking advantage of your earnest search for information as a means to line their pocketbook.

4. Ghost Investors

While not technically a business loan scam, this is another con job waiting to hit anyone in the market for a business loan. In this scenario, you would typically be contacted out of the blue by an “agent” for a large foundation, financial fund, or even a wealthy angel investor who is supposedly interested in funding your business.

But first—of course—they need to make sure you qualify for this “amazing opportunity.”

What does that mean? They might need a background check, due diligence paperwork, or endless other forms of legal documentation and proceedings—all at your expense.

Not only is this scam taking your hard earned money for a supposed investment opportunity that will never come to pass—but these scammers are also gathering personal information about you and your business that can later be used for identity theft and other forms of fraud!

In the real world, strangers don’t show up out of the blue offering you free money. From the beginning this scam sounds too good to be true—and that’s because it is.

Go ahead and pass this opportunity right on by in favor of a funding situation that you know you can trust.

5. Business Credit Repair

Particularly if your business is just getting started, no reasonable lender expects you to have an extensive credit history. (That would be like asking to see the credit history for a newborn baby! It just doesn’t make sense.)

Even so, there are plenty of less-than-honest businesses out there who would be eager to convince you otherwise. They’ll make the pitch that you need help fixing your business credit in order to make it look like you have enough of a financial history to be eligible for a business loan. These services are a useless waste of time and money.

It’s important, though, that we don’t confuse this service with personal credit repair, which can be useful to borrowers in some circumstances. If your personal credit score is less than 650, you might have a harder time obtaining a business loan—or be limited to fewer options. In this case, a personal credit repair service might help you to clean up any erroneous claims on your credit report, identify and address any outstanding debt, and take other steps to clean up your personal credit history and improve your score.

That said, there are plenty of scammers in the personal credit repair industry as well—so do your research to make sure you’re working with an authorized business before you buy.

6. Swindling Loan Brokers

This all too common business loan scam looks very similar to the advance fee scam, with the exception that the phony business in question is not a lender but a broker promising to connect you with a reputable lender.

A loan broker’s role is to help you find the right loan product for your business, prepare the necessary paperwork for your application, and connect you with lenders who would be a good fit for your business needs.

While this is a lawful service available from verified loan brokers, the service becomes a scam anytime a loan broker is asking you to pay upfront for their services. Ethical loan brokering services work on a commission-based model in which the broker obtains a percentage of the total loan they help you to obtain—usually directly from the lender and at no cost to you.

Any loan broker who asks you to pay up front is at best charging you for a service that you should be able to get for free—and at worst planning to take your money and run.

Watch Out for These Signs of a Business Loan Scam

As you can see, there are a whole host of ways that well-meaning business owners can be duped by con artists just looking to make a buck. What we’ve highlighted above are the six most common business loan scams that we hear about—but these aren’t the only forms of business loan fraud that you might encounter. Every day, these criminals are coming up with new and creative ways to waste your time while stealing your money and your personal information.

To help you avoid these and other business loans scams, here are eight common warning signs to look out for when considering any business funding opportunity:

1. Unsolicited Contact

Cold calling isn’t a common method among credible small business lenders for connecting with new prospective borrowers. If you hear from someone out of the blue offering you a business loan and you’ve never initiated contact through an online form or any other method, consider that your first clue that something might be amiss.

2. Non-Traditional Advertising

Legitimate business lenders don’t advertise through Craigslist, personal Facebook messages, or yard signs on the side of the road. If you see marketing messages for a business loan that look out of place, it’s probably because they are—and the person sharing that advertising is up to no good.

3. Money Requested Up Front

We’ve said this before, but it’s worth reiterating. You should never—ever—give someone money up front for the purpose of a business loan. Not for a credit check. Not for a brokering service. Not for an application or processing fee.

There is no reason that you should ever be required to pay money in order to obtain money for your business. If any lender, loan broker, investor, or platform asks you for any form of upfront payment, end the relationship immediately and move on.

4. Lack of Physical Address

Even online lenders who connect with their customers exclusively over the internet have a registered physical address for their headquarter offices that you can easily research and identify. In fact, listing a physical address is a legal requirement for sanctioned lending institutions—so if you’re questioning the credibility of a loan opportunity, asking for the business’s physical address is a great way to investigate.

If your point of contact won’t offer a physical address, gives you only a P.O. Box number, or if the address they provide doesn’t seem to match the business they claim to operate—that might be further evidence that your instincts were correct.

5. Generic Email Address

Similarly, authorized lenders and loan brokers don’t use generic email addresses. If you’re receiving contact about a business loan from a Yahoo, Hotmail, or generic Gmail account, that’s a clear sign you’re being scammed.

Keep in mind, though, that the presence of a website or domain-associated email address doesn’t necessarily prove that a lender or a loan broker is the real deal. These days, anyone with modest technical skills can purchase a domain and set up a basic website that looks just like a real business.

6. “Guaranteed” Approval

Among credible business lenders, there’s no such thing as “guaranteed” approval for a business loan prior to a credit check and financial review. If you see advertising or receive unsolicited contact for a business loan that makes any mention of “guaranteed approval,” you have most definitely encountered a business loan scam.

7. High-Pressure Sales Tactics

Does the loan officer or broker you’re communicating with seem just a little bit too eager to sign the dotted line on your small business loan agreement? If you’re getting the slimy used-car salesman vibe, trust your instincts, take a pause, and research the validity of your business loan opportunity.

Credible or not, any loan representative who isn’t willing to give you a night to sleep on such an important decision isn’t someone you should be doing business with.

8. Terms Too Good to Be True

Simply put, does this funding opportunity just sound too good to be true? Is the interest rate dramatically lower than what you’ve seen elsewhere, or are you being offered funds outright before you’ve provided any information about financial history, your business plan, or how you intend to repay the loan?

Our biggest piece of advice when considering whether a loan opportunity might be a scam? Trust your gut. And if in doubt, go a different direction. There are enough legitimate, verifiable online lenders out there for you to find the funding your business needs without wondering whether you’re about to be swindled.

As long as you have a solid business plan and are in a financial position where it makes reasonable sense for you to be taking out a loan, you have every opportunity to get what you need without becoming the victim of a fraud.

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