If you have recently moved to the United States, unfortunately, your credit history from your home country will not follow you to your new place of residence.
Without a U.S. credit history, it can be difficult to access various financial services such as credit cards, loans, and even apartment rentals. You may face higher interest rates on any loans you are approved for, or worse, you may be outright denied.
Fortunately, there are several ways to start building your credit history in the U.S. as soon as you arrive. This guide will walk you through each option, helping you choose the best approach for your financial situation:
1. Use Your International Credit History in the U.S.
2. Apply for a Secured Credit Card
3. Become an Authorized User on a Credit Card
4. Establish a Relationship with a U.S. Bank
5. Consider a Credit-Builder Loan
6. Make On-Time Payments and Monitor Your Credit Score
7. Avoid Common Credit Mistakes
1. Use Your International Credit History in the U.S.
If you are moving from certain countries, you may be able to transfer your existing credit history to the U.S. using an international credit agency like Nova Credit.
Currently, Nova Credit offers this service to newcomers from Australia, Brazil, Canada, the Dominican Republic, India, Kenya, Mexico, Nigeria, the Philippines, South Korea, Switzerland, and the United Kingdom.
When you get approved for a U.S. credit card, you can begin establishing your credit history by managing your account responsibly. This includes paying your balance in full each billing cycle and maintaining a low credit utilization ratio.
You do not even need a Social Security Number (SSN) to be approved for a U.S. credit card and start building your credit history. The major U.S. credit bureaus—Experian, Equifax, and TransUnion—track and try to match your name, date of birth, and address to your credit history, even without an SSN.
With your consent, Nova Credit can translate your international credit data into the U.S. format and share it with lenders when you apply for credit cards, loans, and other financial services.
2. Apply for a Secured Credit Card
If you cannot use your international credit history, consider applying for a secured credit card to begin building your credit in the U.S. This type of card is designed for borrowers who do not yet have a credit history and requires a cash deposit as collateral. Your credit limit is usually equal to the amount you deposit.
Secured credit cards function like regular credit cards. You can use them online, link them to payment apps, and shop in stores. Many of these cards do not have the word “secured” printed on them, so merchants will not know the difference unless they recognize the card design.
After a few months of making on-time payments, you may become eligible for an unsecured credit card, which does not require a security deposit.
Some of the best secured credit cards to consider include:
- Discover it® Secured Credit Card
- Capital One Platinum Secured Credit Card
- Citi® Secured Mastercard®
3. Become an Authorized User
Another way to build credit in the U.S. is by becoming an authorized user on someone else’s credit card account. With this approach, you are not applying for your own credit card. Instead, you are added to an existing credit card account and given a card linked to it.
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