Building credit
 

Hi what is the best way to build credit when arriving in the USA?

Re: Building credit
 

So far i've been here 4 months and with 1 secured credit card I have built a "Good" nearly "Very good" credit rating with Trans Union and Equifax. I use Discover.

I have a measly $500 limit, but what I do is pay off the balance every couple days. The reason for this is that credit card utilization for each statement will affect your credit rating.

This month I spent $550 on my credit card, but the balance is now $0 ready for my statement on the 23rd. When reported to the bureau it will look like i'm fantastic with managing credit and I still get all of the cashback.

As soon as I get my imminently awaited EAD and can start my job I will go ahead and get them to change it to an unsecured card.

An auto loan may also help. I considered purchasing a Nissan and they said that as long as I earned $75k+ a year then they wouldn't need to credit check and would immediately offer best rate.

Re: Building credit
 

Check out our Wiki Guide on this topic.

Rene

Re: Building credit
 

Re: Building credit
 

If you need a car, and one of you has a job in the US ready, waiting for you, a car through International Autosource will get you onto the credit reporting system immediately with a regular installment loan.

Even if you could pay cash for a car, borrow a little through IA (IA is an agent for the auto manufacturers credit units (my Mustang bought through IA was financed through Ford Motor Credit), and pay it off over 12 months and it will kick-start your credit, and means you don't have to worry about buying a car when you have so many other things to do after you arrive. :)

Re: Building credit
 

My background: Crossed border K-1 ... Married Oct 2013. Green Card delayed til July 2014, Social that September. Searching for job Sept/Oct got Job November 2014.

Turned down for apartment October 2014 ... No credit and actually my report stated fellony crimes in Kentucky 1999. Thanks America, thanks! Appeal to Texas while onboarding at new job and looking for place to live.

No ability to drive so can't do car credit. Clearing the false fellony also helped a lot.

Journey:
- Secured Credit $300
- After a year JC PENNEY denined
- Waited a bit, kept the $300 the balance under $150
- Approved Kroger Rewards, $5,000 limit
- Kept that balance below $2,500
- Always made payments on time (auto pay)
- Kept using the credit and churning through payments, mainly did that by loading Student Loan payments on Credit (Brexit helped exchange rate).

Score went through the roof based on, never missing payments, using the credit, keeping balances low, number of total lines of credit low and waiting for average age to tick over a year before making new applications.

Re: Building credit
 

Word of warning, I heard it's better to have some balance than no balance for the purposes of building credit.

i.e. the ideal credit card balance when they pull your statement is $1.

I don't know if that's true though. But it's what I heard.

Also, how will you get them to change to an unsecured card. I'm in the exact same boat as you, I've got a secured Discover with a $500 credit limit which I've had for 4 months. But I'm already working. I didn't think they'd graduate you to an unsecured card until you hit 8 months of credit history.

Re: Building credit
 

Yes keep your balance in the 20 to 30% utilization area and don't go down to zero balance. Try not to go above 50% too. I aim to be in the 15 to 30% zone in case any emergency comes up.

Like I had to fly home for a funeral with little time to plan and well it was in June and that was expensive.

Re: Building credit
 

I don't see much truth to that. My statement balances were always $0 and I graduated automatically after about 6-8 months. Since then they automatically bumped my limit again ($500-$1000-$1500).

Re: Building credit
 

I'd agree with Tom. I always ensured my balance was $0.

I've since graduated from my secured card with a $300 limit. To an unsecured card with a $500 limit and it just recently got upgraded to $1000. The entire time I've ensured the balance was paid in full down to $0 and not used more than 30% of my credit allowance.

Re: Building credit
 

The average age of all combined lines of credit also factors in. Don't open too many lines but if you have to try to get them all within that year so the age at the same time ... Keeping the average age up.

That's what I'm struggling against, if I can get my average credit age up that's the only thing left I can do.

Re: Building credit
 

There's nothing really that you can do about that, except wait patiently.

Re: Building credit
 

What credit checking bureau is recommended? I'm staying away from Equifax after the gigantic breach.

HSBC gave me a credit card based on my salary, so I had a $10,000 limit off the bat with 0% for a year. We ended up hitting it pretty hard due to the enormous cost of setting up an apartment from nothing, but I'm trying to pay it down as rapidly as possible now that we've almost got everything we need.

It would be good to check after Christmas once I've been here for a full quarter.

Re: Building credit
 

Your details are probably on the black market for sale regardless of what credit bureau you use. :lol:

I use CreditKarma on my iOS device and I also use Experian from time to time.

Re: Building credit
 

Credit Karma, Credit Sesame and CreditWise/Capital One are all good and free.

Even if you don't use Equifax for credit checking, they will still hold information on you.