mikechristina

Hi,

So after a long and painful immigration process and so much help from all the fab folks on this site, I arrived in the US on 23rd November The Florida sunshine is great and have zero regrets.

Rapidly realising that I need to build my personal credit history (read fat brits excellent guide - many thanks!) and am interested in other peoples experiences in doing this?

I have a strong income, but that seems to count for zero when applying for credit. Getting a mortgage in my name is a waste of time right now, brokers not even bothering to call me back

Unfortunately my wife is probably going to have to file for chapter 7 bankruptcy due to the fact that her name is still on the mortgage for her former marital home (ex husband not paid the mortgage since May 2011) and deeply in negative equity (upside down as they call it here).

We want to buy a home and only need a small ($100,000 ish) mortgage, but it does not seem to matter that we are putting 75% of the house value down in cash.

I have opened a bank account and have a strong balance in there with other money from my business (self employed as a head hunter) going in regularly. In process of applying for 'secured' credit card.

Generally reading everything I can on what steps to take in building credit from zero and maintaining it - much if it common sense, but seems you have to play the cards in a certain way.

Noorah101

Just to give you my immigrant husband's experience in building his credit....

First he got a secured credit card from Wells Fargo. A year later, after timely payments, they closed that one and gave him a real credit card with a higher limit. In the meantime, during that year, I added him to my credit cards as an authorized user (but that was back in 2004, and I've heard that method doesn't do much now). He was able to open a department store credit card (Mervyn's, which no longer exists now) and he used that here and there to show activity.

After that 1 year period, he applied for and received a Chase visa card so he could get SW Airline points. In subsequent years, he applied for and received an American Express card (with a Delta airlines logo), and a Bank of America credit card which he never even uses.

About 2 years after he arrived in the USA, I added his name to the deed on my home, so that he would have home ownership on his records.

Now, after 8 years here, he's got a great credit score. Never missed a payment, and never made a late payment.

Rene

sir_eccles

There is no quick way as such. Only time builds up a history, don't obsess about scores. If you have a credit card don't max it out, pay it off in full each month. Get your name on the utility bills pay those in full each month. Wait...

rpjs

Here's my experience:

* Arrived Jan 2011. I have a good income starting from Feb 2011 when I moved from the company's UK to US payroll but no credit history at all in US. OH has a good credit score (750s) from keeping up US student loan repayments from UK but no history other than that.

* Feb 2011 OH opened a credit card with our bank (one of the big 5) with $3000 limit with me as additional card holder. She's been good at paying it all or mostly off each month. She tried also to get an travel points credit card with the same bank soon after but was declined.

* May 2011 opened a Macy's store card in-store - instant decision based on SSN. Have maintained no more than a couple of hundred $ balance at any time and mostly paid off completely each month. Haven't used it in a few months so balance now $0.

* Sept/Oct 2011 I started receiving solicitations for "rebuild your credit" type cards. First few were from companies that a quick Google suggested I should avoid, but within a couple of weeks I got a solicitation from Capital One which I replied to and was accepted for. This starts with a credit limit of $500 which they will review for increase after five on-time payments (which should be the payment after next for me). I've been maintaining a balance of up to $300 (which I know is not optimum on this) and paying off about $100 per month.

* Dec 2011/Jan 2012 - we both start getting solicitations for various flavours of Amex card but so far we've not responded to any.

* Feb 2012 - OH applies for travel points card again and is accepted but with proviso that bank won't give her any more credit so she has to take $800 off her existing card's limit for the new card.

* Feb 2012 - we weren't planning on looking for a mortgage for another year or so, but a house on our street comes on sale for $100k below market value for a quick sale, so we go to bank to see if we have the slightest hope and on basis of our credit scores (mine 721, hers 780) we get initial pre-approval, subject to documentation and full credit checks. We don't have much of a down payment, so are limited in the mortgage options we have and won't get a stellar rate if we get one. We may not make the checks as we don't have W2s for 2010 as we were in the UK - the bank said they'd do an international credit check on us but that it may not be enough.

So realistically we probably won't get this house, but we've been pleasantly surprised how good a state we are now in, and if we don't get this one we'll revert to our original plan and look again in a year when we expect to be in a good situation.

I do think the store card was the thing that kick-started my credit record here, so I'd strongly suggest you pop into your local Macy's and see if you can get one, and go for it if you can.

Bink

I agree with this other than I personally have had a bad experience of getting a Macy's card and I know my other expat friends have also been declined by Macy's. I got a Lowe's card easily enough and generally store cards are easier to get. I was told by Macy's that it was the <2 yr history that was the reason for rejection for me.

I got a secured card when I came over, then got a pre-qualified offer from capital one and took them up on that. I then co-signed a car loan with my American wife and subsequently after having more than a years credit history was able to get an FHA insured loan ($270k).

It's the history that will hurt you more than the score. I have a good score (730+) but it's the lack of history that's always caused me issues not the score itself.

Bob

AmEx global transfer.

Secured Credit Card.

Car loan.

And time. No shortcuts.

Bob

Won't make a difference as they don't positively impact your history, they only report late payments to ding it.

mikechristina

Thanks for everyone's replies, as ever much appreciated

So being a determined young man, I ended up probing a few brokers and got a call out of the blue one day from a guy I had been chatting with. He put me in touch with 2 companies who he said would possibly offer me a mortgage based on my UK credit history.

I went and met with a lady yesterday and she seems pretty confident she can get me a mortgage by just saying I am effectively buying a second home in Florida and as we are putting down 75% of the value, our loan is even more likely to be approved.

BUT I have some concerns, firstly would this in anyway effect my immigration status? I cannot see how, but have a niggle in the back of my mind. Second, what about the tax implications now and if we come to sell it in the future, technically it would not be our primary home?

To get the mortgage I would have to pose as though I were still living in England. She assured me that other people have done this before and often before they move over here, so they have a home to move straight into.

We are not going to move on anything until we have crossed the I's and dotted the T's. I have a contact to speak re the tax implications, as I feel professional advice would be best in this area.

Any views / advice would as ever be wonderful. The learning process never stops, but the benefits of wisdom cannot be under rated

Noorah101

I personally wouldn't do this. Or if you do, be careful about the verbage you're signing off on. It's OK to say this is a second home or vacation home, BUT I wouldn't sign anything that says your permanent home is in the UK. After all, you just became a US PR, and the USA is supposed to be a permanent home.

I'd be less concerned if you had 2 homes in the USA, and were saying one was a vacation home in one state, and your permanent home in another state. But that's not what you're doing.

Just tread carefully. Probably best not to even go down this route, since it's not really the truth.

Rene

rpjs

Agreed. In a worst-case scenario it could be construed as mortgage fraud. I'm not saying that such a worst-case is at all likely to happen, but it's a hell of a risk to take.

mikechristina

My experience in taking out mortgages is that you have to be careful what you tell the provider. The first home I ever bought a house they refused to give me a mortgage because I was self employed, so I got my business partner to say he was my boss - I paid the mortgage no problem and everyone was happy. I remain self employed to this day (17 years on).

My core concern lies with how the US tax man will view it and if it could crop up when it comes to converting my CR1 to Perm Res status? What do they look at come this time?

I will tread very carefully, but nothing to lose in seeing if I can get the mortgage?

Wibblypig

Have you tried Wells Fargo? They offered us a mortgage last Sept as long as we had a 20% deposit and a further 10% readily available, we didn't so couldn't take them up on it. I will PM you the guy's email address

Vicki

mikechristina

Was that a mortgage in both names? i.e drawing on some US credit history? This is in my name only with zero history, I cannot include my wife at this time as per my original note above.

Wibblypig

No it was just in his name as I am not eligible for a SSN. We had no credit history at all in the US. We are on temporary visas, my husband's is a H1B (work visa) and mine a H4 (tag along to his ).

HTH

Vicki

md95065

Not quite sure what you mean by this - if you entered the US with A CR-1 you *are* a permanent resident already - the "conversion" (if you want to call it that) happened when you were admitted to the US.

Anyway, while you are correct to be concerned about the tax issues, none of this has any bearing on your status as a permanent resident.