Personal Credit Vs Business Credit

This post mainly pertains to personal credit in order to discuss the various elements that make up the personal credit decision to get approved on a home loan for 1-4 unit financing in the US.

Personal credit has various factors that affect the score from how much availability of credit you have, the mix of your credit types you have (revolving, installment, mortgage), your utilization of credit, your payment history, inquiries, and many other factors that are not very make sense when it comes to maintaining a great credit score.

Business credit is more simple and does not have as fancy of a formula to maintain your scores. Its purely based on time frame from in which you make a payment and the more accounts you have and the quicker you pay the better your score. Business scores are generally based on a few credit models from Dunns and Bradstreet (largest database) or AKA D&B, experian, and couple others while personal credit has hundreds of different scoring models which confuse borrowers all the time. 

Each day I get a borrower who says their personal credit is 800 or 670 fico when we run their report it turns out to be completely different. This is very normal with consumer or personal credit.

Business credit terminology uses "paydex," score instead of a fico score that lets creditors know what your credit track record is in timely pay back of your obligations.

Building both credit systems can vastly maximize a persons ability to obtain capital for different projects or investments.