Stage Three of the Free Guide
How to Build Small Business Credit with No Personal Guarantee

Step 4 ~ Dunn & Bradstreet Scoring Model

When you visit the Dunn & Bradstreet (D&B) website you will find a wide range of business credit reports available for purchase, from $10 to several hundreds.  For those of you with small-to-medium size businesses it is highly unlikely the high-end reports will ever be used when a corporate credit lender is making an approval decision.  Although D&B has a wide variety of scoring models, in most cases there are only two that are instrumental when building corporate business credit.

The first milestone to achieve when building corporate credit is the Paydex score, which will generate after 3-5 lenders report activity.  The Paydex score is a simple business credit score that measures timeliness of payments and it ranges from 1-100. Although the upward Paydex range is 100, we have only seen and hear of the highest Paydex score being 80. This means the business paid all its bills on or before the due date.  With each late payment the Paydex score drops at least one point and as soon as you are below a 75 it will be nearly impossible to be approved for any future corporate business credit. To give yourself the best chance at building business credit it is very important to always pay your bills before the due date as many lenders will report a late payment even if it is just one day late.

The second milestone to achieve is to have a fully rated business credit file, verifying the company’s size and sales figures.  Although this piece isn’t as critical as the Paydex score it can make a difference when attempting to obtain large unsecured corporate business lines of credit.  There are two ways to get a fully rated file, submit your information through e-update (explained in the next step) and enter the numbers for your company.  The recommended option is to call and speak to the Entities Department, discussed in the Disputing step, and relay the same information to them.  They might ask for a company financial statement and a QuickBooks or Quicken version will suffice.  We recommend this option because it will reduce the number of times you have to speak with a D&B sales rep.