
Getting a business loan can be a piece of cake if your business credit score is in good health. But have you ever wondered why your personal credit score is part of a business loan decision? When you apply for a business loan, the lender also checks the personal credit score of the applicant (usually the business owner) before sanctioning the loan.
This can be the case for newly started businesses as well as for those early-stage businesses looking for their first business loan.
In this article, we examine why personal credit scores play a crucial role in determining the outcome of your business loan.
Why do personal credit scores matter for business loans?
Your personal credit score is basically a mirrored image of how you handle your personal credit obligations. However, some people are of the opinion that your personal credit scores aren’t relevant and shouldn’t reflect how your …