Three Common Errors on Business Credit Reports and the ways to fix them

Can you imagine the situation? You submit an application for financing for your business, but you’re turned down?

Once you ask the lender the reason why your application was denied, it’s as a result of negative information that showed-up on your business credit report.

There’s only one issue, the negative information on your business credit report is a mistake.

Common Errors in Business Credit Reports

It could be discouraging when problems on your business credit report prevent you from qualifying for business financing or services. But when the negative credit information that is stopping you moving forward should not be there in the first place, it can be frustrating.

Here are three common errors found on business credit reports. (Continue reading and we will show you and explain how to fix these problems once they happen to your business.)

Mixed Business Reports

It’s unexpectedly common for a business credit report to list accounts that really belong to a different company. The main reason this kind of error happens frequently is because of how the business credit reporting agencies add information to credit files.

When a creditor (also known as data furnisher) reports information to a business credit agency, the bureau will have to match the account with the correct company and include it with that business credit report. To achieve this match, the business credit bureaus will pair up the account to a company name and address but neither has to be accurate.

If a different business has a similar name or address to yours, there is a possibility that business account could mistakenly end up on your company credit reports.

With your own personal credit reports, by comparison, the consumer credit bureaus choose three-out-of-four matches of the following: name, Social Security Number and date of birth, address.

It’s easy to understand how the less-detailed data matching policy the commercial credit bureaus use to add information to a business credit report can result in mix-ups. The system itself leaves much room for error.

Years in Business

Another error that may regularly show up on a business credit report has to do with how many years your company has been in business. Here is an example of a business credit reporting error which many business owners might be tempted to disregard. But, when it comes to your business, age issues the older, the better.

At first, it may not look like a big issue if your business credit report shows you’ve been in business just for five years when it’s actually been eight. Yet the age of your business is an important factor to many lenders when you submit an application for financing or vendor accounts for your company.

Note: The number of year of your accounts is an important factor in some business credit rating models. If an account on your company credit report, such as a business credit card, is reported as a smaller number of years than it should be, the mistake might affect your credit ratings unfairly.

Identity Theft & Fraud

It is no secret that credit reports consist of a lot of personal, careful information that you would not want to get into the hands of the wrong people. On the consumer side, the Fair Credit Reporting Act prevents the credit reporting agencies from sharing your credit information with anybody who does not have permissible reason to access your information. Unfortunately, businesses don’t enjoy these same protections.

You haven’t any legal right to privacy when considering business credit reports. The credit agencies can sell them to anyone willing to pay for them.

In addition to the known fact that your business credit reports aren’t private, information about your business may also be publicly accessible through your Secretary of State website. The bottom line is this; it is not difficult for a fraudster to have access to your company’s information.

When a thief has your business personal information e.g. EIN, business name, and address, he may use it to open his own accounts in the name of your business. Business credit cards, lines of credit and business loans, other sources of financing could be fraudulently exposed in your business name, without you knowing about it.

This perspective for company identity theft is one more essential reason why it’s very important to monitor your company credit reports frequently. Monitoring your credit file might not avoid business identity theft from taking place, but it can assist you to react quickly if the criminal activity ever takes place to business.

Fixing Mistakes

However, mistakes on business credit history occur more frequently than you may believe. A Wall Street Journal survey found that 25 percent of small enterprises who checked their business credit file discovered errors. Even worse, the errors those continuing business owners discovered put their business right into a riskier credit category.

Your business does not enjoy the exact same protections when it comes to credit reporting as you’re able to count on for your personal credit reports. The Fair Credit Reporting Act, a law that is federal protects consumers from inaccurate and unjust credit reporting practices, does not apply to your company.

It’s being said that, the company credit agencies do permit you to dispute wrong informative data on your company credit report when you find out a problem.

Here are five ways to fixing errors on your business credit reports:

Check your business credit reports and review them for precision. It’s a good idea to check your credit reports with all three of the major company credit reporting agencies. Dun and Bradstreet Experian, Equifax

Make a list of any incorrect information you find, even although you don’t think the error is just a deal that is big. You won’t really know whether a mistake has the ability to influence your business credit scores unless you’re a data scientist who creates credit scoring models for a living. It’s better to become safe than sorry and dispute any given information that is inaccurate.

Initiate a dispute that is separate each business credit bureau that is including incorrect data on your business credit reports. Here’s just how to submit a dispute with each of the three major business credit reporting agencies:

Dun and Bradstreet

Experian

Equifax

Don’t take no for a solution. In the event, your dispute that is first failing but you understand that the home elevators your business credit is wrong, it’s ok to follow through. Make sure to add documents that are supporting strengthen your claim, if possible.

Keep an eye on your company credit file to be sure they remain accurate. Monthly credit checks are an idea that is good both for your personal and business credit file. If you’re checking your reports every month, you will be able to react quickly if and when a problem occurs. A free account from Nav can get this procedure a lot easier and much less expensive. You can create a free account by clicking here. http://bit.ly/FreeBusinessCreditCheck

Furthermore, if the errors on your business credit report certainly are a result of identity theft, the company credit reporting agencies can be willing to incorporate a fraud alert on your own report. Fraud alerts let future lenders understand they should simply take steps that extra verify that any credit applications in your company’s name are legitimate.

No Body Cares More Than You

You would certainly be able to expect your business credit reports (as well as your personal credit file for that issue) to contain only accurate information. Yet the fact remains that credit reporting mistakes happen all too frequently.

It’s your responsibility to review your credit reports both business and personal to make sure they remain error-free. No-one else can do this job for you. Also, no one cares more about the health as well as the accuracy of your credit reports than you.