Same score. A $52,500 difference.

Here is the whole article in four lines.

• ◆Your score is one of five things a lender reads. Federal Reserve data shows only about half of applicants get the full amount they ask for.
• ◆The other four come from your bank statements.
• ◆Those four are the ones you can change fastest.
• ◆Change them before you apply, not after you are declined.

Now the detail.

Start by inverting the question

Most owners ask, "How do I get approved?" Charlie Munger would flip it: what makes a lender say no?

It is rarely one big thing. It is a handful of small ones that stack up. A lender is trying to answer a single question: will this business still make the payment in a month that goes badly? Anything in your file that makes that answer less certain costs you money.

So read your own file the way they will.

The five things on the page

• ◆Deposits that repeat. Twelve steady months beat one great month. A lender is buying predictability.
• ◆Cash that stays. What is left at month end, after you pay your own bills. This is the money the payment will actually come from.
• ◆Debt already on the books. Payments you owe before the new one is added.
• ◆Recent inquiries. Several applications in a short window look like a business that keeps getting turned down.
• ◆What the money is for. "Equipment for a signed contract" is a reason. "General needs" is a shrug.

Notice what is not on the list: how hard you work, or how good the business really is. A lender cannot see that. It sees the statements.

Same score, different number

One business. $25,000 a month in deposits. $6,000 left at month end. No existing debt. Three years in operation.

We ran it through our capacity model three times, changing only the credit habits.

Look at the first two rows. Same score. $52,500 apart. The only things that moved were how much credit was already in use and how many times the business had asked.

Buffett's test for a business is whether it can take a bad year and keep paying. Cards run near their limits say the answer may be no, whatever the score says.

These are examples from our own model. They are not offers, and a lender decides for itself on the full file.

What the Federal Reserve found

The Federal Reserve Banks survey small employers every year. In the 2025 survey:

• ◆52% of firms that applied for a loan, line of credit or cash advance were approved for the full amount they asked for.
• ◆Split by the Fed's credit-risk groups, 60% of low-risk firms got the full amount. For medium-risk firms it was 32%. For high-risk firms it was 30%.
• ◆Only 38% of firms applied at all.

Read that the way Munger would. Roughly half of applicants ask for an amount and do not get all of it. The gap between low-risk and everyone else is 28 points or more. That gap is what the preparation below is for.

One honest caution: the Fed says this survey is not a random sample, so treat the figures as a guide, not a forecast for your business. Our model examples above are a different thing again. They are illustrations, not survey results.

Source: Federal Reserve Banks, Small Business Credit Survey 2025, employer firms (via FRED, St. Louis Fed; series SBCSS3B0V0FRB, SBCSS3B8V1FRB, SBCSS3B8V2FRB, SBCSS3B8V3FRB, SBCSS2B0V0FRB). The survey is not a random sample. The model examples above are Canady's own illustrations, not survey results or offers.

What to do in the next 90 days

Do these in order. Each one is cheap.

• ◆Pay cards down before the statement closes, not after. Utilization is read from the statement. Same dollars, different timing, better picture.
• ◆Stop applying until you know your number. Every application can add an inquiry. Find out first, apply second.
• ◆Give the business its own account. Move personal spending out for the three months a lender will read. A clean account is easy to underwrite.
• ◆Write the use of funds in one paragraph. What it buys. How it pays for itself. If you cannot write it, you are not ready to ask.
• ◆Check your number. About a minute. No credit pull. No documents.

What we will not tell you

We will not tell you a score of 720 gets you approved. It does not. We will not promise an amount, a rate, or a timeline. We are a broker. We help you present the business honestly and put it in front of the right lender, and the lender makes the decision.

What we can tell you is that the work above is within your control, and it is cheaper to do before you apply than after a decline.

The plain version

Your score says how you handled credit. Your statements say how the business handles cash. Lenders read both, and you can only move one of them quickly.

Start with the one you can move.