What Is An Internal Risk Analysis Score?

Understanding the IRAS Score in Alternative Lending

In the world of alternative lending, understanding different credit scoring systems is crucial.

One such system is the IRAS score, also known as the Internal Risk Analysis Score.

The IRAS score is a credit scoring system used by many unsecured lenders to assess the creditworthiness of businesses seeking funding. It's a key tool in the decision-making process, helping lenders evaluate the potential risk associated with a loan.

The IRAS score is universally used across the alternative lending space in the USA. It provides a comprehensive view of a business's financial health, taking into account various factors that might not be considered in traditional credit scoring models.

As a business owner, understanding your IRAS score can help you better prepare for the lending process and increase your chances of securing the funding you need.

When it comes to securing funding, the underwriting process plays a crucial role. And the first thing an underwriter looks at? Your IRAS score.

The Internal Risk Analysis Score (IRAS) is a key factor that underwriters consider before even pulling open any financials. This score, which would typically have been filed with the last lender you obtained funding from, provides a snapshot of your business's creditworthiness.

The IRAS score helps underwriters quickly assess the potential risk associated with a loan, making it a critical component in the decision-making process. Understanding your IRAS score and its impact can give you a leg up when seeking funding.

Who And How Decides What My IRAS Is?

The main contributing factors that make up your IRAS are as follows:

• Borrowing History

• Payment History

• Stacking History

• FICO

• Finacials

• Industry

• Time In Business

• Net Deposits

These factors combined result in what is known universally as your IRAS.

What Is Considered A Good IRAS?

A good IRAS score typically falls within the 600 bracket. This score indicates a lower risk to lenders and can increase your chances of securing the funding you need. If your score falls under this bracket you can expect longer terms, higher dollar amounts and lower factor rates.

On the other hand, an IRAS score within the 1900 bracket is considered bad. This score suggests a higher risk to lenders and can make it more challenging to obtain funding at the terms you require.

Understanding where your IRAS score falls within these brackets can help you better navigate the lending process and take steps to improve your score if necessary.

How Can I Lower My IRAS?

In the world of alternative lending, your Internal Risk Analysis Score (IRAS) can make or break your chances of securing funding. But did you know that the number one factor that can drastically lower your IRAS is your payment history?

That's right - making all your payments on any existing positions on time, as per your agreement with your lender, is crucial. Consistent, timely payments demonstrate to lenders that you're reliable and can manage your financial obligations effectively.

So, if you're looking to improve your IRAS score, start by ensuring your payment history is spotless. It's a simple step, but it can have a significant impact on your ability to secure the funding you need.

Stay tuned to our blog for more insights into the alternative lending space and tips on how to navigate the lending process successfully.

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