When you’re new to the United States, you have a lot on your plate: opening a bank account, finding a safe way to send money home, figuring out your living expenses, and the list goes on. Building your credit score may not be first on your list. However, it’s important to consider as you settle into your new country.

Your credit score is what many U.S. financial institutions look at when you apply for things like loans, credit cards, and an apartment lease. For new immigrants and international students in the U.S., it can be difficult to know how to build your credit score.

While there’s a lot involved in building and maintaining good credit, this article will help you get started.

First of all, what is a credit score? This number is created through the three major U.S. credit bureaus, Equifax, Experian and TransUnion. They develop a credit file to show whether you’re likely to pay your bills on time. 

The FICO credit score, as it is known, is based on five main factors. These are: payment history, amount owed, length of credit history, type of credit you use, and new credit accounts. 

The higher your score, the more likely you are to get approved for a loan or an apartment lease, as it shows you’re responsible with your money. It can take months to years to build a good credit score, so start as soon as possible. 

Fortunately, there are a couple of simple ways to start building your credit score as an immigrant. Not surprisingly, both of them involve a credit card.

Building credit as an authorized user

If you have a trusted friend or relative with a high credit score, you may be able to work with them to establish your own credit. If this person has their own credit card, they are the “primary user” on that card. You can build credit by becoming an “authorized user” on the same account.

Becoming an authorized user is an act of trust on both sides. It means that your name will be added to their credit card, and you can use it as the primary user would. Doing so can help build your credit score as their payment activity gets reported on yours as well.

Be careful when going this route because if the primary user doesn’t make on-time payments, it could lower your score. 

Also, be sure that you’re both clear about whether and how you’ll be able to use the card. Make a plan for sharing payments, for example. 

Building credit with your own credit card

If you’d rather apply for your own credit card, there are many companies that offer ones for those who have low or no credit. 

Most options you’ll find are for secured credit cards. This means that you’ll need to put down a deposit, which acts as your credit limit. Plus, you may also need to pay an annual fee for the privilege of using the card.

Most credit card issuers give you the option to switch to an unsecured credit card within a predetermined amount of time after making on-time payments. At that time, you can get your deposit back and may be able to waive the annual fee.

While there are unsecured credit cards that don’t check your credit history, these tend to also come with high annual fees, high interest rates, and a low credit limit. 

build your credit score as an immigrant like this woman with two simple steps

What Identification Will You Need for a Credit Card?

Some credit card companies will require a Social Security number, or SSN. If you are authorized to work in the United States, you will likely need to get an SSN. You can see full details about how to do so in this document from the Social Security Administration.

If you don’t have a Social Security number, many credit card applications will allow you to use an Individual Taxpayer Identification Number, or ITIN. 

Read more about how to get an ITIN at our guide here and from the IRS website.

Learn More

This article from The Wirecutter is a thorough guide on how credit works and how immigrants can build theirs from scratch. Immigrant Finance also offers a detailed guide on immigrant credit score tips.

Next, Remitly has articles for immigrants on opening a bank account in the U.S., setting financial goals, and making a budget, among others.

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This publication is provided for general information purposes only and is not intended to cover all aspects of the topics discussed herein. This publication is not a substitute for seeking advice from an applicable specialist or professional. The content in this publication does not constitute legal, tax, or other professional advice from Remitly or any of its affiliates and should not be relied upon as such. While we strive to keep our posts up to date and accurate, we cannot represent, warrant or otherwise guarantee that the content is accurate, complete or up to date.

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