By: First Union
Breaking Down Your Business's FICO SBSS Score
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Only U.S.-Based Businesses are Eligible. No startups
When applying for business funding, the lender will look at a variety of factors to determine your creditworthiness. One such factor: your FICO SBSS score. Banks, alternative lenders and also the SBA use this score to help them decide whether or not to approve your loan. If this score isn't where it needs to be at the moment, there are steps you can take to raise that SBSS score.
What Exactly Is a FICO SBSS?
SBSS stands for Small Business Scoring Service. FICO devised this score to have a more standardized scoring system in place for small businesses. It rates a company's creditworthiness based upon a scale that ranges from 0 to 300. This SBSS score also aligns with your FICO personal score, and so it is important to stay on top of it.
There are two categories used to determine your FICO SBSS: data on the company's principals and then also general financial data on the business itself. FICO has not revealed how heavily it weighs the various items, but some speculate that the owner's credit can account for anywhere from 50 to 90 percent. Thus, ensuring that your credit is up to par is extremely important to your overall SBSS.
As far as the business finances, it looks at payment history, credit use, cash flow, assets, any negative public records, and a number of employees among other such factors.
Who Uses FICO SBSS Scores?
Several different entities rely on your SBSS score, to include:
- The Small Business Administration; uses this when screening for potential loans. If yours falls below 140, generally you're automatically rejected.
- Banks and other lenders will also use this to help them determine whether or not to issue you a loan.
- Various online and alternative lenders look at your SBSS; their threshold, however, is generally lower than that of banks and the SBA.
Even if you're unsure of your SBSS score, or think it's too low for a business loan, we'd still like to talk to you. First Union Lending's flexible business loan programs don't just focus on one number, but the entire picture. Call today!