Your credit history and status will always be a factor when lenders consider financing your entrepreneurial endeavor. No matter what type of loan, even loans for those who may struggle to acquire traditional financing, such as SBA funded micro loan, will consider credit as one of underwriting factors.

Because your credit history and status greatly impact your bankability and ability to acquire business funding, it behooves you to spend a significant amount of time developing and creating positive credit status and repairing poor credit history.

== personal note ==

When I got married I gifted my wife with a huge debt load and a toilet level credit status. Through diligence, patience, and time, I’ve been able to repair my history and develop credit status that has allowed us to finance vehicles, mortgage and refinance homes, and acquire construction financing. So I know you can repair your credit history and develop positive credit status but it takes patience, diligence, and a willingness to reprioritize your financial outlook.

== personal note ==

Now, here is not-so-secret formula for developing good credit and repairing poor credit.

1. Time -- You will need to plan ahead if you want to acquire business financing. It takes time for bad spots in your credit file to be removed. It also takes time to engage in process of having them removed. You must also spend some time engaging in positive credit behavior.

Mary had a delivery service business. Her idea was to market to senior citizens who couldn’t get out every day. She came to me as a SCORE counselor because her business was struggling and she thought she needed marketing help. She had been marketing to seniors for more than a year and was frustrated by her results. She hoped I would have silver bullet that would change everything.

My first question to Mary was had she written a business plan. I wanted to see her marketing plan and forecast of sales. Mary told me she had written one before she started but she said she “just didn’t believe it.” A business counselor had worked on cash flow section with her but forecast was much more optimistic than she really believed possible.

It always astonishes me that people go into business with a business plan that seems impossible to them. If business owner doesn’t believe it then who will? Not believing your own plan should be a red flag to entrepreneur to go back to drawing board.

The owner may need to redefine their market or update their idea to something that will generate business owner needs. It may take more market research (What does market want? How much is target market willing to pay?) It may take a more robust marketing plan in order to reach numbers entrepreneur needs to get sales flowing. It may also take more money to fund necessary marketing or support equipment or services.

Sometimes entrepreneur just needs more confidence in his/her own ability to get work. In that case it may be that entrepreneur needs to work in someone else’s business first to see how it is done and gain that confidence.

Another tact that an owner might take would be to make a minimal investment in business to get it going and find other work for self-support while he/she experimented with business-a pilot or beta of sorts. This in effect would be real time market research.