Financing in Outer Sunset>Question Details

robwat, Home Buyer in San Francisco, CA

I am a new immigrant to USA. How do I get a credit score?

Asked by robwat, San Francisco, CA Sun Nov 4, 2012

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Ann Ryan’s answer
I agree with Tony. No cosigning. Much better to approach the issue in the gradual way described by Jack.

Alternately, talk to several banks which do A LOT of business with new immigrants. There are in fact banks that will issue home loans to foreigners. Ideally, these will be banks that deal with many people from your home country. Around here, I could find several who would write loans for Venezuelans, for example.
1 vote Thank Flag Link Fri Nov 23, 2012
Here are the FACTS. First step is to get a social security number if you haven't done so by looking up your local social security administration. Once you have that, one option is to apply for "Store Credit" with retailers like Macys, JCPennys, etc. However, it is likely that if your social security number is that new, you may even have a difficult time with those accounts. Good news, there's another way.

Use prepaid credit cards also known as Secured Credit cards. This is where you send money to the credit card company for them to hold as collateral for repayment of the credit card if you don't make payments on time. Be sure when you choose one of these secured card provider that they do report to the credit bureaus. Here's more info on the Secured Card Options. Warning, most these companies do have an annual fee which I have seen range from $50 up to $100 depending on various options.…

Contrary to popular belief. you DO NOT have to carry a balance or pay interest to establish credit. The credit bureau only reports regarding this topic is 1) the size of the credit line issued to you 2) what the highest balance has ever been 3) what the current balance is at this moment. So what is the best way to handle this? Usually these secured cards are small balance (couple hundred dollars). Use the card until it is nearly full being EXTREMELY careful not to exceed your credit limit. Then, pay the balance back to 0. Why does this strategy establish credit? Because in a banks eyes, you have responsibly used the amount of the credit issued and not exceeded the credit line, then had the discipline to pay off the balance you borrowed.

Once you have this secured card in place for 6 months, visit 1 retailer you would like to shop at. You will find it much easier to get credit now. In another 6 months you can add another retailer credit line. Then lastly when you get to 1.5 years from the issuance of the first Secured card, apply for an unsecured visa. Each of these new credit lines should be handled just like the secured card. Use the entire balance, then pay if off and leave the balance at 0.

Having been a lender for over a decade and both attending and teaching credit counseling courses for home buyers, this works the best. Good Luck
1 vote Thank Flag Link Mon Nov 5, 2012
See Jack Campbell's comment for the best answer.

IMO: Do not ever co-sign a note unless you are buying a car or home with your wife. Co-Signers
get all the pain with none of the pleasure. Co-signing can wreck your credit easier than it
will build it.
0 votes Thank Flag Link Fri Nov 23, 2012
One of the ways is to become a co-signee on another person's credit, if possible.
Secured credit cards that are being reported to the credit agencies (not all are, so need
to ask in the banks if they report).
Small gas and retailer cards.
Some states have self-employment micro loans programs - and many are reported as a credit line.
Check out Accion USA.

Best of luck!

Hope this helps,

Irina Karan
Beachfront Realty, Inc.
0 votes Thank Flag Link Wed Nov 14, 2012
Having just gone through this with a client you will need to build it over time. As a citizen we go through the same process when we reach young adulthood. You need to get a credit card, any card, to start. It used to be that the first one would be a store card, like Sears or Macy's. Then you have to use it. Having it and not using it will not build a score. The credit companies want to see a history of on-time payments and they also like to see that it isn't paid off every month, they want to make money. Carry a small balance and pay a bit more than the minimum to enhance the score.
In America you're nobody till you can walk into a store and walk out with your new purchase for just a signature.
Unfortunately this is part of how we measure you and allow you to buy cars, houses and other expensive items. There was a story recently about a Canadian citizen who didn't have sufficient credit history in America and wanted to buy a house so he contacted a Canadian bank affiliate in America which loaned him based on his bona fides in Canada.
0 votes Thank Flag Link Mon Nov 5, 2012
Jed Lane, Real Estate Pro in San Francisco, CA
Hello Robwat,

Because you have likely never owned a US-based credit card or other loan, it will be important to open an account and start building credit. Once you start using your account it will take some time to show good history by paying your balances on time, etc.

Feel free to contact a financial expert to get more detailed information on how your previous credit history may be helpful and to see what you can do to build good credit in the eyes of the American credit scoring agencies.

I can also be reached directly if you'd like to contact me.

Best of luck!

0 votes Thank Flag Link Sun Nov 4, 2012
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