Minty

Hi! I will be relocating to the US at the end of the year and have read a lot about needing a credit history - even to just get a mobile phone! What is the best way of establishing a credit history?

Minty

bored-silly

It's very difficult! You can't get a credit rating until you have had something on credit and you can't have something on credit until you have a credit rating...........
We worked with an American company who sold us a brand new car for a reduced price but we had to agree to it and sign for it while we still lived in England (sounds dodgy eh?) But that gave us a small credit rating. You may find that someone like HSBC will give you a credit card through their American branches (of which there is not many) and that will help.
Basically, its a case of going very carefully on what you apply for as each refusal goes on your credit record - Therefore worse credit rating. What a bitch eh?
We were advised that the best thing to raise your credit rating is to buy a house. There are a limited amount of mortgage brokers who will give you a mortgage with no credit rating but the rates are not great.
Hope that helps a bit!

Pimpbot

Do a search in this forum for threads on gaining credit. They should give you a good idea on how to go about it. I've been here over a year and still have 0 credit. But I haven't actively set about trying to gain one until just recently.

justboy

I actually just paid $12 on myfico.com to get a credit report......i have been here for just under a year and the only type of credit agreement i have is with our car financer, who i went in on with my wife. I was shocked to find that my rating is just under 700. I 'll give it a few more months and see what it is like. I was expecting it to be under 600!!!

ironporer

A few ideas:

1- Get a secured credit card thru Providian, Cross Country, Orchard Bank or similar. You'll have to pay a fee- ie $120 plus the deposit for the line of credit you think appropiate- maybe $500. Use the card and try to use most of the limit up- BUT make sure you pay it off monthly, the full balance!! This will avoid intrest, but give you a history of on time payments.

2- Get as many bills as possible in your name- ie Telephone, Cable, Elec/Gas, water etc. Again, make sure each is paid in full and on time.

3- Savings account and Checking account in your name at the bank/credit union.

4- Do not apply for every credit offer that comes your way. Each time you do, a credit check is ran, and entered. Too many applications looks bad, especially when denied.

5- After 6-8 mo. of paying all the above on time, apply for a Target or other Dept. Store credit card. Typically they'll give beginners a $200-300 line of credit. Use it, and pay on time.

6- After a year of all the above apply for a car loan. I'd suggest a 3 year loan for a $5000-6000 car. Make all payments ON TIME! Car dealers can get financing for anyone, but the rate of intrest may be higher than for Mr Joe American with great credit.

By this time, the credit card offers should be coming in for Non-secured cards, and gasoline cards. Get one- hopefully with no or minimal annual fee and drop the secured card. Keep using it, and paying it off IN FULL each mo.

After a couple of years or three, a mortgage for a house is not out of the question.

Remember- no credit is almost as bad as bad credit. Expect higher intrest rate credit cards- but if you pay them off each month, you don't ever pay intrest. Having credit cards and not using them does you very little good- they are looking for a payment history.

Ray

Dozens of UKers get mortgages every week in Florida and they don't even live in the country.. thats the easiest one to get ..

dbj1000

I agree with all of Ironporer's points except the mortgage one. We applied for a mortgage after only 9 months here and, with a 10% deposit, secured a 30-year 80/10/10 mortgage at exactly the same interest rate as a USC with excellent credit. In many ways credit cards are more difficult to get than mortgages, because with a mortgage they look at many aspects of your financial situation OTHER than just credit score and history. In our case the fact that we had a 10% downpayment, my employment details and the fact that we had owned a house in the UK were all regarded as more important than our (at the time) mediocre credit history.

fatbrit

Sorry – don’t go with the first three of these ideas at all!

1) Don’t get a secured card from any of these folks at all. I would also add to this group Capital One. They are sub-prime lenders! Therefore, you become a sub-prime borrower. Get yourself down the big boys or local credit union to open the secured card. Will cost you a lot less or nothing in fees and now you’re a prime borrower.

2) Won’t increase your credit score at all. May decrease it if accounts go into default.

3) Won’t increase your credit score at all.

fatbrit

...as long as you've got a reasonable deposit. Unsurpising really, as the collateral ain't going to be going anywhere!

fatbrit

You may still get rejected by the underwriter for insufficient history or insufficient lines, despite the good FICO. Probably time to start building what you've got, even if it results in a temporary decrease in your actual FICO score. Most underwriters will base their decision on more than the FICO score.

bored-silly

Wells Fargo have approved us for a shit load of money for a mortgage and they have some rates for particular companies who employ expats. We have only been here 10 months

scrubbedexpat099

For a Mortgage they will do an International Credit Report, but for some reason it takes time. You would have thought they could use the UK arm of the same Credit reference agencies.

I was told a month and as you can close on a house pretty quick then it can be an issue.

Minty

I have had an HSBC account for over 20 years and I see they have some branches in the US. Would it be helpful ig I got them to issue me with a card? Would my credit history from the UK help?

Minty

THFC1

Does anybody know if a Corporate Amex card in your name will help to improve your credit score?

BritGuyTN

one of my friends got one of these when he move over and it didn't show on his reports...

get a secured card with bank of america/citibank or chase and/or a secured loan

regarding the other posters comments about sub-prime lenders liike providian, cap one, yes they are not that great, but they serve their purpose as a rung on the ladder to getting a prime credit card and a are a worthwhile step up from a secured card

the whole utility bills thing is a common misconception - they don't report on your report as they are not a revolving or installment line of credit.