Tips for immigrants seeking to establish a credit history in the U.S.

28 Nov
2009

Emigrating to a new country means starting from scratch with the credit, but no shortcuts

credit-cards-reverse-move U.S. attracts many people who dream of a better life. But when immigrants arrive, they do rarely accompanied by their credit histories. Moving to America means starting over with credit.

Jeroen Baert, 39, moved to Atlanta from the Netherlands, where he had an excellent credit history. When tried to open an account at a bank with branches throughout the country, was surprised to learn that the institution was willing to give him a debit card.

“I had just put money in the account. They could see that he had money to retire,” says Baert. “But they would not give me the card.”

He had the same problem when he tried to buy a small car. “I went to two or three different dealers,” he says. “No one was interested in giving me a car leasing.

The problem was that lenders had no way to access the credit report that Baert was in Holland. “The laws of cross-border transfer of data often prevent credit information from a foreign country is sent to the United States,” says David Rubinger, spokesman for Equifax, one of three U.S. agencies business reports.

The data privacy laws and consumer protection make it illegal in some countries disclose credit information to lenders outside their borders. Even where no laws governing privacy, the differences in approaches and formats for credit reports make it difficult to share information internationally.

And yes, if you are established in the United States and wants to move to another country, you will feel the same: to leave this land means leaving behind your credit score. American expatriates also have to start from scratch in regard to credit history.

Lack of access to foreign credit reports
Linda Sherry, director of national priorities for Consumer Action, a consumer advocacy organization, said that without access to such credit history, lenders may be reluctant to provide credit.

“A credit history allows lenders evaluate the risk that, you do not return the loan,” he says. “If you have no credit history or the lender can not access the history, poses an enormous risk.”

Lenders do not contact the credit bureaus in the country of origin of an applicant, even if the laws do not prohibit disclosure of credit information. James Jones, manager of consumer education for Experian, the United Kingdom, said that there is currently no system or procedure to transfer information between lenders and credit agencies from different countries.

“I know these issues have been studied repeatedly. And they continue studying. But now there is no system for sharing such information,” says Jones. “Run on behalf of each individual to find a way to get that record to the lender.

Although the credit history is frequently used, it is not the only criterion to guarantee the credit. For foreign people can improve their credit history by addressing the issue of U.S. credit applications from a slightly different perspective.

Tips to build a credit history in the United States

* Talk to your lender. Jones suggests call any lender and explain your situation before you apply. “It’s always good idea to talk to the lender,” he says. “There are procedures to process the application manually. And yes, you may be told you can not help, but that will save you having to fill out an application useless and unnecessary search of your credit history. Some lenders are willing to offer credit if you file a proof of income from your employer, other documents relating to their financial history or make a down payment or deposit large enough. But never will know this if not question before.

* Keep a copy. Jones also recommended that a copy of your credit history, translated into English if necessary, to offer it to the lender. With that information, the lender may be willing to try to verify the information and help to enter the world of credit.

* Talk to your employer. It is possible that your employer to work with you to establish a credit history, especially if the company is used to do international business. When Baert Holland moved to Atlanta, the application he signed with his company helped him to get a debit card that initially had been denied. Consult your human resources department to find out what options exist for foreign employees seeking access to credit in the United States.

* Talk to companies with which they already have a customer relationship. When a U.S. dealer refused to grant a lease Baert, he went to BMW. “I had a BMW before, and the finance department was able to verify my history with BMW in the Netherlands” he says. If you have already established a relationship with a lender or another international organization in your country, you can build on that history when applying for a new credit line.

* Be patient. Establish a credit history in the United States does not take as long as you think. If you open a bank account and used wisely credit products, lenders are more willing to give him his chance.

Sherry recommends that newcomers applying for a secured credit card (prepaid). “Over time, the use of that card will appear on your credit report and lenders will show you are reliable.

One or two years after moving to Atlanta, Baert had no trouble finding lenders willing to offer credit. “When I arrived, I had trouble getting a credit card, but two years later I get offers ten different platinum cards.

Written by Credit Card

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