g1ant

I have a checking account with Wells Fargo and a savings account with about $2k in it. I have permanent residency and no credit rating whatsoever in the US.

I was talking to a guy in a bar in Austin who is a mortgage broker (well isn't the pub the best place to get free financial advice?? ) and he said to take out a Wells Fargo credit card secured on the money in the savings account and make be sure to use it at least every month and pay the balance off in full. He said that every month I make a payment on time, my credit score goes up.

Does that seem good advice?

Of course, after the pub, an internet forum is the next best place for free financial advice. Isn't it?? :scared:

Minty

That is my understanding too. HSBC (who I bank with) have a banking arrangement with Wells Fargo and they (today) sent me all the forms to complete and arrange for a bank account to be set up now for me even before I move. The bank sends a letter of introduction telling them what a wonderful person I am and please give me a credit card!!!

Minty

fatbrit

Advice is good. Additionally, don't put the card's balance at more than 30% of the maximum, don't use this card anywhere that might incur extra charges (e.g. subscription, car rental), be a-retentive about paying it well on time monthly (easy with WF as you can just use 'transfer' in the internet banking). $2k is a waste of good money to tie up for the year, half that should be sufficient.

Ash UK/US

Hmmm... My husband did the same with me when I moved here 2 years ago.. added me to his bank accounts, credit cards... we bought a car last Oct with both of our names on the loan. We are very good payers (we pay our credit card balances in full as soon as the staement comes in and are never late in paying other bills, morgage, car, utility etc). My husband has excellent credit. I started working for a large company about five weeks ago and decided to apply for a store card monday just gone (with the same company) and was denied... hubby had to open it in his name and have me added maybe it is the lack of work history? I would have thought by now I would have some kind of credit history.

Ash

fatbrit

If they deny you credit (or offer it on less favourable terms), they have to tell you the reason why. Also, you get a free copy of whichever credit bureau(s) they pulled to make their decision. You should get a letter in the post about it soon. Follow the instructions to get the info.

sohosid

Hey guys n gals...

Just this minute got off the phone with American Express, and the news is pretty good for those of us yet to make the move.

If you apply for the card in the UK and get accepted, when you move they will do a transfer to the US, and you start getting a credit rating straight away. No faffing around trying to pursuede someone else to give you credit...

Mike.

Ash UK/US

They did say that I would be getting a letter about it within 14 days.. I will be interested to see what they say.

Ash

Just Jenney

First, being an authorized user on someone else's account does NOTHING to build up your credit score.

Here's why: An authorized user is someone who, literally, is authorized to use someone else's account. It does not make them financially responsible for that person's account, and that's a crucial differentiation.

If you are an authorized user on someone else's account, then that account (and its history) does show up on your credit report. However, the credit report specifically reflects that you are only an authorized user on the account -- an "A" will be to the left of the listing. And since authorized users have no financial responsibility for the account, it does nothing to build up their credit score. Only accounts for which you have financial responsibility will help build up your credit score.

Now, being added as a SECONDARY (aka joint) cardholder can help establish a credit history, because being a secondary cardholder means having joint financial responsibility for the account with the primary cardholder, as well as for that account's history.

Second, you said, "getting on as an authorised user is very cool ... it will very positivey impact your fico score."

Again, that's not correct, on two counts. One, as just mentioned, being authorized to use someone else's account does not help you build up your credit score. Two, if you are a secondary cardholder on someone else's account, that CAN have a positive effect on your credit score, IF the primary cardholder has good history on that account. If the primary is/was delinquent, then that delinquent history shows up on the secondary's credit report as well, and thus can negatively affect their credit score.

In my job with a major US credit card company, I talk with A LOT of people who are looking to help their spouses/children establish credit history, and falsely believe adding them as authorized users will do the trick. It won't. It just means they can spend on the account and not have to pay for anything.

~ Jenney

scrubbedexpat099

Jenney, you might be able to answer this, when we applied for a Mortgage in the end we did not include me as a joint applicant as I had no score, I think I had my SSN for 2 weeks when we completed and it would have taken longer to get my International Credit Report than the buying process. Having an extra target of any standing I would have expected to be a positive, but it did not work out that way.

For the International Credit Report they were going to use some company I had never heard of and when I looked them up they seemed more into Commercial Credit.

Now Experian etc operate in the UK, so why do not Credit Card co's etc just access the data they have on you?. Judging fro the FICO parameters I would have a very high rating, lots of Credit Cards which I pay off every month. But of course nothing of consequence here?

BritGuyTN

you are talking nonsense - the fact that you work for a us credit card company means jack shit - if you worked for fair isaac then this would give credibility to your assertions.

your fico score according to fair isaac is based on the following factors:

- What is your payment history? Roughly 35 percent of your score.

- Do you owe too much? 30 percent of your score.

- How established is your credit? 15 percent of your score.

- Do you have a "healthy" mix of credit? 10 percent of your score.

- Are you taking on more debt? 10 percent of your score.

If you are an authorised user, the payment history, % utilisation of revolving credit and length of credit are all factored onto your credit score as if they are your accounts

what your're saying is if you have a credit card in you own name with a $500 limit which is fully paid off, and a card where you are an authorised user with $5000 CL which goes from zero balance to maxed out, your score will not change?!!?! CRAP - your score will tank - mine went from 720 to 650 overnight in similar circumstances

what you say flies in the face of what people vastly experienced in credit matters say. I haven't come across anyone working for a lender of credit - mortgages, credit cards, autoloans etc who has a clue what they are talking about when it comes to credit reporting and scoring, and after your long post of misinformation, i have to say you fit into this category

if you want to learn more then check out

www.myfico.com
www.creditboards.com
www.creditinfocenter.com

Bottom line - if you come to the US and your USC spouse has long-established tradelines with NO late payments and LOW utilisation and adds you as an autorised user then your SCORE wil increase greatly

Likewise - if they miss payments and increase their utilisation then your score will decrease greatly

And as stated earlier - you can have a great FICO score by this backdoor method, but can still be rejected for credit after manual review, when they see the accounts aren't wholly yours

Ash UK/US

That certainly has not been my experience.

Ash

BritGuyTN

mine went down to 650 from 720/730, went up a bit to 680 as i added a couple of my own tradelines with no utilisation - and just went up to 740 after my better half transferred the large balance from the account i was on as an authorised user to a new credit card where i was NOT

ASH - i've PM'ed you with some possibly hepful info

Ash UK/US

Thanks

fatbrit

The problem with your reply is in the quoted part above. The card issuers all do their own thing and post to the bureaux as they see fit. Some issuers will post an additional user as such, others will not. Unless you sit at the board table of the dirty tricks dept of your company (or are widely read), they are unlikely to impart this imformation to corporate drones. Whether FICO's alchemy takes note of this, I'm unsure. However, I'm sure that underwriters use the info when making their decision.

To anybody with kids (or foreign spouse) who wants to give them a start on their credit score, the answer is simple. Don't apply for their card as an additional user but apply for a jointly liable account. This is rarely advertised and - usually - one person needs to apply for the card, then phone up and get them to send you the paper work for making a joint user. If the user is a kid (or treats money like a kid!), don't even tell them you've applied for the card and put it through the shredder on receipt. Using this method, it doesn't matter a damn how the issuer reports it to the bureaux.

scrubbedexpat099

Thats what we are doing, but like has ben said before it is only a part solution, as is a HBOS or AmEx US card.

Does not seem so much of an issues with US Kids, my stepson has an OK score and all he has is Student debts.