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A business loan is one of the most popular methods for those starting a business and they are a relatively simple way to gain the funds you need to get your business up and running. When looking to build a business, a large majority of entrepreneurs will need a business loan, and these are a great way to get your business idea off the ground if you don’t have a lump sum sitting around (and let’s face it, not many of us do!)

There are several types of business loan, including short term, term and equipment financing, and the type a business uses is dependent on variable such as the amount of money they need to borrow, the duration they will need to pay it back and what the money is required for.

One particular question that many enterprising business people raise, aside from being concerned regarding the approval of their loan, is whether the outcome of them applying for a business loan will be detrimental to the credit rating of them or their partner or spouse. It’s an understandable worry, as although business people plan for businesses to be a success, it is wise to be cautious and look after our personal affairs.

The recommended way to ensure your business credit has little or no effect on your personal credit rating is to keep the two separate. If you make sure your business has a separate identity by registering it for its own Tax ID with the IRS, opening a separate bank account and registering the business at an address other than your home, you build the foundation on which you can build on your business’ own credit rating.

For new business start ups the bank/lender will usually review your personal credit, as they have no business credit to work off, so in this case a business loan is likely to affect your credit score and may lower it slightly.

Where a business already exists, a loan application is more likely to be accepted without the need to take your personal credit rating and status into account.

Like many finance areas, with business loans there is no single rule, as a range of factors affect your application, and these vary from case to case. However as a guideline, loans for a new business are more likely to affect your personal rating than loans relating to an existing company.

If you are looking for the best business debt help then visit The Business Debt Advisor for useful advice forbusinesses in debt.