Q:

What can a company do to improve bad business credit?

A:

Quick Answer

Improving bad business credit involves monitoring credit reports for mistakes, contacting creditors to request a payment plan and paying outstanding credit balances, according to Experian. Making sure that vendors are reporting company payments can help raise credit scores as well.

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Full Answer

Analyze the company's credit reports for discrepancies and outdated information, suggests Experian. Asking for a current copy of the credit report from the three credit bureaus, TransUnion, Experian and Equifax, does not influence the company's credit rating. Pay close attention to items under the "negative" category because damaging information older than 7 years should not be included on the report.

Contact the company's creditors to request a restructured repayment plan, recommends Intuit. Creditors could suspend the company accounts to allow monthly payments until the debt is paid off. Some creditors accept a lump sum payment or an exchange of goods for smaller accounts.

Once reasonable terms are worked out, the company must focus on eliminating debt as quickly as possible. Keep balances low or pay them off completely every month, states Forbes. Pay all invoices and bills on time, because the longer a payment is overdue, the lower a company's credit score becomes.

The company can also apply for a business credit card with a provider that reports transactions regularly to the credit agencies, explains Intuit. Contact suppliers and ask if they report payments as well. Credit ratings increase when more vendors confirm a positive credit history to the bureaus.

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