oopssorry34

Hi All, does anyone have any information on International Credit Checks? My credit rating is rather poor and I wondered if this would have any bearing on an application for a mortgage in the USA? As I understood it, credit rating in the UK is as about as much use as a chocolate teapot in the USA, I'm wondering if they use it to credit score, or just prove that you say who you are and that you do actually have some history in the UK, albeit good or bad. I have never missed one payment of a mortgage, council tax, car loan or utility bills, just the mean and nasty credit cards! Any input greatly appreciated thanks all!

Pulaski

How long have you been in the US? If you have been here six months or more, and have a healthy down payment (minimum 10%, preferably 20%) then you are unlikely to have any problems getting a mortgage without needing the international credit check. After all, if you default the bank just siezes the house, .... and American banks are not at all shy about doing just that!

NC Penguin

No, it's your credit history in the US that will have an impact on your mortgage application. As you mentioned yourself, your British credit history has no bearing on your credit standing in the US.

I've been in the US just less than 2 years myself and I've been told by a mortgage company that I do have a credit score. She didn't make any additional comments on telling me that I suppose it's not a bad score since I can be put down as a co-owner on the mortgage.

However, I am a salaried employee, I do have a store card and most importantly, I have acquired the US credit history of my US spouse.

If you are anxious about your US credit history and score, why not look at it yourself, prior to applying for a mortgage? That way, you'll see exactly what lenders will see and you can prepare for any awkward questions that might come your way.

Patrick

When we moved here the bank did an international credit check, there is a company that does it for the bank and they contact all your creditors in the UK (which you supply!). This bank had to do an international credit check as I had never lived in the US and my wife had not lived in the us for 8 years. The international credit check could not be used to enhance our credit on anything else though, it is just used for the bank to allow them to give us a mortgage.

With the international credit or not you will still need a down payment of at least 10% but probably around 20%

Patrick

oopssorry34

Due to the sale of our home we are financially secure and all our financial commitments in the UK will be paid up before we leave. We have enough for a 20% deposit, or more if required. But if a credit check were run at the moment, it would show all our outstanding commitments but this would not be a true reflection as once we are in the USA we won't owe anything in the UK. This is what is worrying me, if i were a bank i'd take one look at the customers financial commitments and think "would not touch with a barge pole!" We have been asked to provide the Credit Check ourselves, I wonder what would happen if we declined to do it? Aren't there other ways of proving credit history? surely recent utility bills, 2 years worth of mortgage statements & and 2 months worth of bank statements, mail order statements and such like .. surely this could all be taken as proof of credit history in the UK? Any suggestions?

Thanks!

NC Penguin

OK. I'm getting the picture now. I hadn't realized that you hadn't even moved to the US yet.

If you are asked to provide a British credit report by any US lender and you decline/refuse, this would immediately put "red flags" against your application.

Why? Regardless of the reasons why you wouldn't want them to see your credit report, the US lenders I'm afraid won't give you the benefit of the doubt and will assume the worst. i.e. you simply have bad credit.

I speak from experience of sorts. Despite having a glowing credit history in the UK, within six months of arriving in the US, I was turned down for a US credit card in my own name because I had insufficient credit history in the UK. The credit card company couldn't care less about my UK credit history (not that I offered to provide it to them. Don't know that I could even do so if I was not resident in the UK at that point).

In the US at least, your credit history/report/score is pretty much the sole source for showing your creditworthiness.

There must be other Brits who've been in a similar situation as you who've moved to the US and bought a house. I hope they'll post their experience of proving creditworthiness.

Best of luck,

oopssorry34

Great talk about a catch 22! So if my husband refuses to do his own credit check, the mortgage maybe declined and if we do, it'll still be declined due to our poor credit history in the UK! Oh Boy! Talk about going round in circles! lol The mortgage broker has said they need the credit check just "for the record", but I don't really want my uk poor credit history being stapled to my husband's mortgage application and to be with hubby for the next 30 years! I really don't know what advise to give him ... anyone out there got any advice or similar experiences? Please! Thanks!

dbj1000

I'm wondering how you know that your credit in the UK is bad. Have you been delinquent on loans? Do you have a string of bad debts? Or do you just have large outstanding balances on credit cards?

It sounds to me like you have little choice in the matter, and will have to provide your UK credit report, but I'm pretty sure that if you can put down 20% or more on the US mortgage your UK report won't write you off for a mortgage.

Alternatively, you could look for another US mortgage lender and hope that they don't ask for a UK report. We didn't try to get our mortgage while we were still in the UK, but having been over here for less than 9 months we secured a mortgage at a very good rate with 20% deposit. At no stage did they ask anything about our UK credit history.

Anyway, good luck!

oopssorry34

Thanks for your reply. I know we've got a bad credit because i've got the report!

The bank did say that the bad credit wouldn't have any bearing on the actual mortgage decision, but I don't see how this can be the case. She said if we couldn't get a mortgage with this particular lender, then she said something about waiting 45 days from the receipt of my husband's SSN and then she could apply from her own bank. At this point I got slightly confused as to why she just doesn't get the mortgage directly from her bank now? I don't really understand the mortgage system in the USA, she works in the bank, but is getting a mortgage from another lender?
She also said that being as we were putting a high deposit down that she couldn't forsee any problems.

I should add that my husband is living and working in the USA and already has his SSN. I don't know, one minute I read that the UK credit history doesn't mean anything to the USA and then the next breath it does! So I guess when the credit history is perfect, they don't wanna know, but as soon as it shows bad, then your penalised for it! A no win situation really!

Shame it was very sad circumstances that got us a bad credit history and now this has to stay with us for always! Thats life I suppose!

Rockgurl

Can't you just move to the USA and rent a place for 6 months while you build up your credit rating here? There's nothing to say you have to buy immediately. I am in the same position as you, as I am about to sell my house and will be financially secure, but I will have been renting for 6 months by the time I want to buy a house. In that time I have been paying utilities, car payments and insurance.

dbj1000

May I ask why your husband isn't doing the morgage application from the US, if he's there already?

Also, I would recommend talking to other morgage lenders or brokers. I went through a broker recommended to me by my bank manager (she told me he'd get me a better rate than her bank!) and although I know he cost me around $300 in extra fees, he has provided me with excellent advice step-by-step through the mortgage application.

If you're feeling confused by the process then your morgage advisor isn't doing a good enough job and you need to find another.

None of which gets around the fact that if you want to go with this particular lender then you have no choice but to provide your UK credit history. Providing it probably won't damage your mortgage offer, but not providing it will guarantee that you don't get an offer at all.

Again, I would STRONGLY recommend shopping around between mortgage lenders, and since your in this particularly complicated situation I would think it is worth paying the extra fees to have a morgage broker working for you who is not tied to a particular lender. Mine was able to tell me what I should and shouldn't do in order to make sure that lenders would not only offer me a mortgage but also give me a rate as good as I would get if I was a long-term US resident.

Good luck!

dbj1000

Oh, and I couldn't agree more with this!

I forgot to ask why on earth you wouldn't consider renting. We've rented for 10 months now, and have already built up an excellent credit rating which makes all this mortgage business so much easier!

Also, how can you know enough about where you're moving to to know where exactly you want to live? It took us at least 6 months to decide on which community we wanted to live in and what the various pros and cons were to the places we could afford to buy a home.

oopssorry34

Thank you all so much for your replies. The advice I have given hubby, is take the report with him on Monday to the bank, explain our past history. Get her opinion, if she agrees to go ahead with the application, great! If not we'll just rent until we have built up our USA credit history and take it from there.

Once again, thank you so much for all your experiences, I really do appreciate them!

Take care all!
The drinks are on me! lol

rogerpenycate

Where to start,
When I first moved over here, someone on this board suggested I go to a store, buy a pair of socks, open an account, pay it off, next month go and buy another pair etc.........and gradually my credit score will build up.
Wrong........I got turned down for a pair of socks !!!!!!

I had an Amex card for 15 years in the UK, a mortgage plus other stuff and never missed any payments.

The only way I managed to get a car was that Ford credit ran a check on me (through Ford in the UK) or so they say !!
They still screwed me for 23% (the maiximum by law) plus forced me to take out a two year extended warranty (another $1,500)

The up shot is that any UK history seems to be worth nowt.
You have to start as a new born baby and build it up.
There may be exceptions, but there don't appear to be an "Bank Managers" with discretionary powers as we have in the UK.

I've been paying off my car for 10 months now, we only have one car and need another but I refuse to pay 23% again.
By all accounts if you get to 12 months then you start getting a Beacon score and things improve.
When I first came I tried to transfer my Amex to here, but was refused, I phone them again last week and they have OK'd it, so I reckon I'm "starting to exist"

I think that unless you have considerable savings and large "lump sums" to put down, it's a question of patience, frustrating as it is.

oopssorry34

Thanks for your reply! On another matter:

"Fulham Football Club for FA Cup - NEXT YEAR !!"

In your dreams! lol Speaking as an Arsenal fan I can easily say

" NO CHANCE!"

Take care!