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For most lending decisions, the first question lenders ask themselves is, how risky is this applicant? They often assess risk considering the credit score and credit file of a business. However, many lenders also check the owner’s personal credit even for startups that don’t have credit histories yet. This is where credit strategy plays a crucial role in helping small business owners unlock funding. Here are a couple of credit hacks that may come in handy in this situation. 

Use Aged Tradelines to Create a Short-Term Opening

An incomplete credit report may make the owner appear indecisive to creditors. Things get worse when there’s very little credit history and too much revolving use. Fortunately, there’s one hack that can turn the picture around quickly: Add an authorized-user tradeline that brings new history and increased revolving credit limits onto the report.

This is important because credit utilization refers to the difference between how much revolving credit a person uses and how much revolving credit they have access to. Higher utilization usually leads to lower credit scores, but tradelines can help improve this factor by adding revolving credit that isn’t used.

However, finding the right platform to purchase tradelines matters. Considering the positive feedback in every Tradeline Supply Company review, it sounds like a good option. The company allows small businesses to benefit from tradelines with minimal cost. Prices range between $400 for a $10,000 tradeline and $600 for a $30,000 one. The tradelines are good for two months of access, making it possible to request funding quickly while they’re active.

This way, you don’t lose the chance to secure additional funding, which is particularly helpful for small business owners who can afford to pay the fee. Besides, sellers can even earn up to $50 to $300 per slot, or up to $1,000 monthly, which appeals if your business has good personal credit to monetize.

Build Fresh Positive History with Secured Credit

Another solution that may not be that flashy but is still effective is to build a fresh positive history. You can do that by applying for a secured credit card or any other type of account that reports to the credit bureaus. Protect this with a perfect payment history, and you’ll be on the safe side. This tactic works best for owners whose profile needs to improve before funding.

Payment history is considered the most critical among major credit score factors. For small business owners, getting secured cards may work as a solution because they’re easier to obtain. They also report activity directly to the three major bureaus, making them a useful addition for any business owner.

While this credit trick won’t result in an immediate change to your credit score, things may improve quickly if the file has little depth to begin with. Just a couple of months of keeping low balances and making on-time payments will help you rebuild your credit report. And if you’re working on your utilization problems along with other changes, your profile can change sooner than expected.

Endnote

After discovering how these credit hacks help you get funding quicker, it’s time to take the next steps. First, check your credit reports from the three major agencies to find areas for improvement. Then, select a trick you’re planning to try: tradelines to speed things up or secured cards for long-term success. Finally, talk to a funding specialist experienced in small business credit. If you act now, you’ll surely see new doors open soon.