In the previous posts about building business credit, we spoke mostly about the Paydex score. The Paydex score is the most common business score used by vendors, and by some lenders.
However, the SBA uses the FICO SBSS score. The SBA requires for many of their loans that you have a minimum 155 SBSS score. Many SBA lenders will be even stricter and not approve applicants who don’t score 180+. Each SBA lender makes their own guidelines since they also have skin in the game as the SBA only partially covers the loan.
If your score falls below the required FICO SBSS threshold then your loan application will go through a manual approval where other factors may be taken into account, making your approval more difficult.
What's a FICO SBSS score?
The FICO SBSS score is a business credit score created by our good old friend “ FICO”. It’s extremely comprehensive and it takes into account the business owner’s personal credit and business credit. It will also ask the lender to provide the business financials and the score will be based on the financials as well.
FICO SBSS scores range from 0-300, the higher the better.
Which credit bureaus do they check?
The SBSS score can be based on Experian, Equifax, Dun & Bradstreet, or all three.
How do I build a high SBSS score?
You may be able to get a passing SBSS score with personal credit only. But if you want a solid one you will need to build business credit as well.
You can check out our previous articles on how to build both personal and business credit.
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You will also need
- Healthy cash flow
- Low business liability compared to your assets
- Be in business for a few years
- Not have any liens or judgments against your business.
What if the business has many partners?
The FICO SBSS score will take into account the personal credit of all business owners who have a minimum of 20% share in the company.
Where can I see my business SBSS score?
You can view it on Nav.com as an add-on to the Nav Prime membership. The total cost of Nav Prime plus the SBSS score add-on, is $59.99 per month (you get a 25% discount if you pay annually).
Just keep in mind that the SBSS score found on Nav is not 100% accurate.
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