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An Immigrant's Guide To Building A US Credit Score Thumbnail

An Immigrant's Guide To Building A US Credit Score


When you are immigrating to the United States, it is natural to want to land on strong financial footing. However, all immigrants face a common barrier: a lack of US credit history. This can impede your ability to get approved for a credit card, apply for a mortgage, or engage in other types of financial transactions. While it’s possible to use cash day-to-day, it is a good idea to begin building a credit history as soon as possible. Building credit can make it easier to apply for a mortgage, get a car loan, rent an apartment, or get a rewards credit card. Even if you aren’t looking to do those things now, you might want to in the future.


Your US credit score, also known as your FICO score, can range from 300 to 850, and most people have a credit score between 600 and 750. FICO stands for Fair Isaac Corporation which was the first company to offer a credit score. The higher the score, the better it is. An “excellent” credit score is 750 or above. People with excellent credit scores can usually get the best interest rates on things like car loans and mortgages.

Your credit score is based on the following:

  • Payment history: do you pay on time?

  • Credit utilization: the amount of credit extended to you that you actually use

  • Length of credit history: the length of time that you have had credit accounts open

  • Credit mix: do you have different types of credit (student loan, car loan, mortgage)?

  • Amount of new credit: do you open new credit accounts only as needed?

There Are 3 Credit Bureaus That Track Your Credit Information

In the United States, there are three credit bureaus, namely: Equifax, Experian, and Transunion. These credit bureaus collect your credit information and sell it to creditors for a fee. You may have a different credit score for each credit bureau since your score is based on the information that that unique bureau has about you. In general, your credit score should be approximately the same across the 3 bureaus.

Credit bureaus normally match your information using your social security number or SSN. Without an SSN, they can use your name, birthdate, current and previous addresses, and employment history for matching.  

How to Begin to Build Credit and Get A Credit Card in The US

Building a credit history may seem overwhelming for any immigrant but there are ways to do it gradually. Here are some strategies to help you establish your credit history.

Strategy 1: Start with a Secured Credit Card

For immigrants, the easiest way to build a credit history is to go into a bank and ask if they offer a secured credit card. A secured credit card is a special type of credit card that is secured by collateral. The bank will ask you to put a certain amount of money in a bank account and leave it there and they will allow you to charge the secured credit card up to the amount you are holding in the account. In other words, if you deposit $500, you can then borrow up to $500.

To apply for a secured credit card, you typically need the following:

  • Permanent address (in the US or your Home Country)

  • Employment

  • Bank account

  • Social Security Number or SSN

  • Individual Taxpayer Identification Number or ITIN

Some banks like American Express, Citi, and Chase may allow you to substitute your ITIN for an SSN.

If you are a foreign student, you may also be required to submit these documents:

  • Bank information or US bank statements

  • Passport

  • US Visa

  • Form I-20 or the Certificate of Eligibility for Nonimmigrant Student Status

Related Article: Green Card Applicants May Soon Need A Good Credit Score

Related Article: Can I Deduct Student Loan Interest If My Loan Was From A Non-US Bank? 

Strategy 2: Become an Authorized User on Someone Else’s Card

If you have a close friend or family member with a credit card, they might allow you to be an authorized user of that card. This does not mean that you get to use their credit card - it means that you get a credit card with your name on it that is linked to their account. The best person to ask is someone who does not max out his or her credit limit and always pays the bill on time. They can add you to their account and you will get a credit card with your name on it that is tied to their account. Ultimately, they will be responsible if you don’t pay and it will impact their credit as well.

Major credit card companies like Bank of America, Citi, Capital One and Chase report authorized user transactions to credit bureaus which can help you begin to build credit in your name. American Express and Wells Fargo will only report transactions if the authorized user is at least 18 years old. Barclays has a minimum age of 16 while Discover only reports transactions for users who are 15 and up.

Credit bureaus also have different policies in reporting authorized user activities. TransUnion includes both positive and negative information, Equifax will do the same if the authorized user is at least 16 years old. Experian will only include the authorized user’s credit report if the primary account does not become derogatory.   

There are also services like ImproveMyCreditFitness.com where you can buy the ability to hop onto a credit worthy stranger’s account as an authorized user for a period of time to build your credit. You don’t actually get to use the card, but you get to piggyback on their creditworthiness and start off your credit on the right foot.

Strategy 3: Do you have a credit card in your home country? Ask the credit card company if they will give you a US card. 

If you or any of your family members maintain an account with an international bank which is also operating in the United States, it may be easier to apply for a US credit card from that same bank.

If you are an existing American Express member, you can try applying to transfer your account to the US online or by phone. You will need your U.S. address during the application stage, and you’ll need to indicate that you are an existing member. If approved, you can even transfer your Membership Rewards points to your new card.

Related Article: How Much Will I Pay In Income Tax While Working On An H1B? 

Related Article: Top 10 Immigrant Tax Mistakes

Strategy 4: Are you a student? You may be able to get a student credit card

If you are a foreign student in the US, getting a credit card can be challenging if you are under 21 years even for US citizens. Discover, one of the popular credit cards for students, will also require an SSN. If you are on an F-1 visa you may qualify right away but you may be rejected if you do not have any type of income.

Extra Tips

●      Put credit card payments on auto pay. Always pay on time and in full to avoid paying interest.

●      Protect your social security number –don’t give it out unless absolutely necessary.

●      Watch for annual fees. Some cards charge for annual fees, some don’t.  

Some credit cards that immigrants have been successful at getting and have been satisfied with include:

●      Discover It Secured - No annual fee, refundable $200 deposit once you build your credit history

●      Discover Student – No annual fee, 0% APR for the first six months, low APR rates

●      Capital One Secured Mastercard – No annual fee, minimum deposit starts at $49

How to Improve Your Credit Score Once You Have One

If you already have a credit history, congratulations! You just took an important step towards building your financial future. Here are some tips to help you improve your credit history. 

  • Always pay your bills on time

  • Pay your bill in full whenever possible. This will reduce the amount of interest you pay and impress upon the credit card companies that you are a responsible borrower

  • Receive credit for timely cell phone and utility bill payments by opting in to Experian Boost. This product also updates your credit score in real time

  • Keep credit card balances low, lenders prefer a credit utilization ratio of 30% or less

  • Don’t apply for new credit if you don’t need it. Multiple inquiries will remain on your credit history for two years and it could drag your score down

Related Article: Do Aliens Pay Taxes? 

Secure Your Financial Future By Building Credit Responsibly And Proactively

Showing your creditworthiness through your credit history is a crucial step once you have immigrated to the US. You will need this information for getting a mortgage, taking out a loan, and applying for a new credit line, among other milestones. While the process can be a little challenging and confusing, it’s worth investing the time and energy to build your US credit history.

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