Success stories abound in the world of smartphone apps, and if you have an idea, you may be searching for ways to finance it. There are crowd-funding options you could try or look for angel investors. You may be able to get investment from family and friends, but the most common method is to apply for a business loan for your app project.
This is usually the most economical as well as the safest option in terms of cost and repayments, but it does require one thing not everybody can claim: a good credit score. There are two main reasons why you may not have a decent credit rating. One is that you have never taken out any credit deals, in which case you are an unknown to the lenders. The other is where you have defaulted on a mortgage, loan, or other credit agreement in the past. This will reduce your standing in terms of credit rating.
Let’s have a look at why your personal rating is important when you are looking for finance for your app project.
Why is My Credit Score Important?
There are many videos On YouTube that look at the subject of credit, credit scoring, and how to rebuild your score and we recommend that you take on some of them as they can be very helpful.
Why will your personal score affect the financing of your app? Your credit score tells the lenders how reliable you are when it comes to repayments. It is devised by taking into account your past history and financial dealings, plus your current situation. If you show a low personal rating, business lenders are likely to be wary of investing in you. This is simply because they want a guarantee they will get their money back. How to start repairing a poor credit score? That’s what we want to look at.
How to Start Repairing a Poor Credit Score
First, if you are young and have never used credit, you will not have a rating. This is a problem as the lenders see you as a blank space. To get over this, we suggest you apply for a credit card – which you will be granted if you have suitable income you can prove – and use it regularly. However, be sure to pay off the whole outstanding amount every month. This method is also important for people with a poor score: if you can get a credit card, do so, and use it as above.
There are also credit rating repair companies who can help you find the best way to restore your rating. They will charge a fee for the service but are experts in this field and will help you get back on your feet. Finally, if you have any outstanding loans or credit agreements, keep the repayments up to date, as this will slowly improve your rating.
Repairing credit does not occur overnight, so start by talking to the experts and they will advise you how to begin.