How to Build your Credit

Credit is an important responsibility, and that’s why we want to give you the answers to the most basic questions about credit. If used appropriately, a credit card can be the first step toward fulfilling the needs of your business.

Why is it Necessary to Establish a Good Personal Credit Record?

Having credit is important, but having a good credit record is vital. A good credit record will allow you to get a loan for your business, a car or a home. 

If you have a good credit record, you could receive a better interest rate on loans. Good credit also increases your spending power, allowing you to make major purchases for your business. Bad credit, on the other hand, could prevent you from these attractive rates, and may also prevent you from getting a job.

How is a Good Credit Record Established?

Opening a credit card can be a first step. Once you do, you need to use your card wisely to build up your credit history. This means:

  1. Use your credit card and consistently pay your monthly bills on time.
  2. Pay at least the minimum amount due. If you can, pay more, as it will further improve your credit record.
  3. Place a moderate limit on your credit purchases and limit the number of credit cards you open.

It is also wise to open a checking and a savings account. Lenders and credit-rating institutions see this as evidence that you can manage your money and meet your credit obligations.

What is a Credit Bureau Report?

It is a summary of information about how you pay your bills, repay your loans and how much credit you have available. Lenders look at your credit record to determine whether they should extend credit to you or your business.

How do Lenders Decide Who is a Candidate for Credit?

Many lenders use the popular FICO scoring model. FICO scores range from 300 to 850. The higher your credit score, the more likely you are to be approved for additional credit. Keep in mind that while many lenders use these scores to help make lending decisions, each one has its own approval strategy. For more details about your FICO score go to

When you apply for business credit, having good personal credit is very important. A business credit card in good standing builds a stronger score and bureau report at the primary business credit bureaus. If your business is a proprietorship, partnership or corporation that has been in business less than three years, you will usually need to sign a Personal Guaranty, which is an agreement that you will be paying for your company’s account.

Manage or Own a Business?

Business owners often use personal credit cards to manage business expenses. But there are several benefits to using a business-specific credit card:

  • Business credit cards enable business owners to easily track and separate business vs. personal expenses.
  • Year-end accounting and tax itemization is simplified.
  • Business credit cards often provide much higher credit lines than typical consumer credit cards offer, which is essential for any new or growing business.

How Do I Learn More?

To monitor your personal credit history, most experts suggest that you review your credit report once a year. You can order a free copy of your credit report directly from:

Free Annual Credit Reports at 1-877-322-8228

What Types of Credit Does Lowe’s Offer?

Lowe’s Consumer Credit Card

Lowe’s Business Account

Lowe’s Accounts Receivable

Lowe’s Business Rewards from American Express