April 23, 2010
If you’ve ever tried to get a bank loan or a line of credit to keep your business humming, especially in its early startup phase, you may have run smack into a Catch-22. The bank turns you down because your personal credit score is so-so (or downright shabby). Why? You’ve exhausted your credit to start your business.
“Your personal credit score can make it look as if your household is carrying way too much debt,” observes Mitch Jacobs, chief executive of Manhattan-based On Deck Capital. “It takes money to run a healthy business, so many of the best entrepreneurs get turned down for credit. It’s ironic.”