Over the last two weeks, more and more small business owners and some consumers that I work with have been mentioning the same dilemma. Many are being told that their credit score is "just short" of what they need to get the loan or line of credit. This failure to acquire financing can be quite detrimental to a company's financial picture. If a business needs to upgrade equipment or heaven forbid their financing is due to balloon out, the stress of a turn-down can feel overwhelming. When overwhelmed by financial aspects, a business may lose focus on sales and operations...compounding the problems.
So what can account for the credit scoring situation that causes people to be "just short" of the required score? Well first of all, too many people make good smart financial decisions within 6 months of applying for new credit. As I discuss in detail during my new book "Financial Folly", there are seven smart financial decisions that will lower a person's credit score. What this means is that anyone within 6 months of a financial transaction should avoid these "smart" financial decisions temporarily.
We may want to consolidate bills, open a store card to save 10%-20% on the purchase, or use a 90 day same as cash program but we must overlook the financial aspect of these decisions if we want to achieve the highest possible score on "application day". All three of these actions along with the four other smart financial decisions discussed in the book will lower the credit score. When the credit score is lowered for these transactions, even if only a small amount, the person or company can expect to be told, "your credit score is just short of the score we need to approve you".
I would encourage people to visit the products section of this website and purchase the book, "Financial Folly". After reading the book you may find that ignorance is not bliss.