Commercial Loans

What should you know first when you are looking into commercial loans? The answer to that: your credit history. Before you apply for that loan, take a look at your credit report. You can do this online. If there are problems, you can learn to clean these up.

You need to look into getting a commercial loan, maybe for a commercial mortgage, investment property mortgage, business purposes or something else. When you apply for commercial loans, you need to consider first and foremost where your credit history stands. You do this by checking your credit report. Your credit payment history is recorded in a file. Who maintains these files or reports? Consumer reporting agencies. One type of a consumer reporting agency is popularly known as a credit bureau. A credit bureau will have your report if you have ever applied for a credit or charge account. They could also have it if you have applied for a personal loan or for insurance, or even a job.

This credit report will list information such as your income and debts, as well as the history of your credit payments. A bankruptcy would also be on the report. Luckily, “The Fair Credit Reporting Act” is in place to make sure that consumer reporting agencies give information that is correct and complete to businesses, which evaluate your application for any type of loan you are trying to get.

You have rights under the Fair Credit Reporting Act. First, you have the right to get a copy of your credit report. You have the right to know who received your report in the past year for most reasons or the past two years concerning employment reasons. If a company denies your application for commercial loans, they have to give you the name and address of the consumer reporting agency that they contacted, if that information is what caused your request to be denied. You also have the right to receive a copy of your credit report for no cost if your application for commercial loans is turned down because of the report. You will need to make your request within 60 days of denial. You have the right to contest the information in the report by filing a dispute with the consumer reporting agency and with the company that gave them the information. They then have to investigate. You can add an explanation to your credit report if you do not win the dispute.

Your credit report is very important when it comes to applying for commercial loans, because a lender estimates how worthy of credit you are according to your credit scoring (or how risky it is to lend you money). Real data and statistics tend to be more reliable than other methods and more objective in scoring your risk factor.

What exactly is a credit score? It is a number which reflects the level of your credit risk. A higher number often shows a lower risk. Statistical models using items from your credit report are used. It is not normally on your credit file under credit history. When a lender wants your credit report it is then generated and given with the report. The number changes when your credit report changes. Your credit score will be affected by whether you’ve paid your bills on time, whether you currently have any outstanding debt, the length of your credit history, whether or not you have recently applied for new credit and how many and what types of credit accounts you currently have. So as you can see, your score will be based on more than your credit report. Your job will affect this, as will owning a home or not.Click here to find more