Bank credit rating for self-employed

A rating is inevitable when a loan is granted. In this rating, the borrower is virtually rated by the bank, which means that the credit institution tries to assess the extent to which the borrower is even able to repay what he may have borrowed to the bank. So the rating is equivalent to an assessment of the creditworthiness.

What is rating? 

The word “rating” comes from the English “to rate” – judge, assess. In the case of the self-employed, this rating not only checks the borrower’s creditworthiness or creditworthiness, but also the company in question. The better the entrepreneur does with his credit rating and his company, the lower the bank classifies the risk of not getting the money back.

Translated, this means for the loan for the self-employed that with a good rating the interest or conditions are also cheaper than with a poor rating. After all, a bad rating on the part of the bank leads to poorer credit conditions or even to refusal to grant a loan.

The rating deals specifically with the economic situation of the self-employed, the management quality and organization of the company, the current and future company situation on the market, the existing customer relationship between the borrower and the savings bank or house bank, corporate planning and company development, as well as the prospect of starting a business Success of the developed concept.

If the self-employed person approaches the bank to ask for a growth investment to be financed, he must hand over to the bank the annual financial statements available up to this point in order to prove that his company is doing well.

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On the other hand, have to convince with their corporate concept, which is best presented in the form of a business plan. The experts at Widesave Bank have summarized for you how best to create a business plan and what to watch out for: create a business plan.

The bank rating also helps the self-employed themselves to better assess their own company or to be able to recognize how good the respective company concept really is. Accordingly, entrepreneurs should not only perceive the rating that the banks provide in the course of a loan application as a hurdle, but also as a “company check”, which can be used to determine where the company’s potential and risks lie.