If you've ever placed a fraud alert or block on your personal credit report, frozen it (even temporarily) due to possible identity theft, or worked with a credit repair company to remove derogatory information you suspected (or claimed) wasn't yours, you may find that your business credit applications are in a permanent state of lock-down.
When you apply for any type of personal credit, whether its from retailers, credit cards, personal loans or auto financing, your creditors are required to perform due diligence tests to verify you are actually you, that you're not currently (or previously) the victim of identity theft, and that the information you've provided in your application matches information that is already verified by outside resources, such as credit bureaus or information retrieval services.
When you apply for business-based credit from a vendor or supplier, they have the option whether or not they want to verify personal credit information on a principal. The decision of whether a supplier wants to pull a personal credit report on a company's principal is usually dictated by the dollar value of the sale. There's hardly any value in spending $20 to pull a credit report for a $14 sale.
But if there is even the slightest possibility your business credit application's approval could render access to cash (hard currency), lenders are now required to perform certain "tests" to validate the identity of the principal whose name appears on the application. While the goal is to separate your personal CREDIT from your business, when it comes to identity verification, you don't have the option of separating your personal IDENTITY from your business.
The requirement to verify your personal identity does not equate to a requirement to personally guarantee the account, credit card, or loan.
Since the shortest distance to any path is a straight line, the shortest and straightest line for identity verification runs through the big three personal credit bureaus: Experian, Equifax, and Transunion. If you have ever locked, blocked, or frozen your personal credit file, or have placed even a temporary fraud alert on your credit report, you may not realize that lenders and creditors may not be able to see your iden