Guest Column: Giving Credit Where it’s Due – Immigrants and Credit Issues

Giving Credit Where it’s Due – Immigrants and Credit Issues

The process of securing immigration clearance to another country is hassle enough, but the travails you must go through once you’re actually there are equally bad. One aspect that most people don’t think of when they’re immigrating to the United States of America is their credit history or lack of it. When you move from one country to another, you credit history does not move with you. Credit unions are not allowed to access your previous history from your country of origin, and so you find yourself with no access to credit or even debit cards, loans and mortgages. If you’re a recent immigrant to the USA, here’s what you can do to establish a good credit history in the fastest time possible:

• Use secured credit cards: This option allows people with no credit history or a poor credit history to obtain a credit card. Secured credit cards require that you deposit an amount (usually 100 or 200 percent of the maximum credit you’re to be allowed) with your card company. If you default on your monthly payments, the money will be claimed from your deposit. These cards are a godsend for immigrants, if they’re used responsibly to build up positive credit.

• Get your employer to help: Immigrants who come to the USA with assured jobs are often in a better position to secure credit, and this is because they have the goodwill of their employers backing them up. Talk to your company’s HR people about providing a letter of recommendation that you could hand over to your lender when you’re trying to secure credit or a loan towards your home’s mortgage.

• Show proof of income: Some lenders and creditors are more than happy to give you credit if you’re able to furnish them with proof of your income and your bank statements. They may charge you a higher interest rate, but you could do some bargaining and get this reduced if you’re prompt with the first series of payments.

• Show proof of previous history: Even though creditors in the USA cannot access your previous credit history, you can; so show them copies of your spending patterns and the points you’ve accumulated back home so that they can assess the kind of credit risk you pose.

• Go where you’re likely to be known: If you’ve lived in a neighborhood or town for a while, you’re bound to have built up a certain amount of respectability (or notoriety). If it’s the former, then you could use your goodwill to get lenders to sign that loan document without taking into consideration that you don’t have a credit history to talk of. People who know you may take a chance on your reputation and advance you the money. Building up a decent credit history is only a matter of time and diligence – if you’re patient and responsible about paying off your bills in time, you’ll have those preapproved offers flowing in sooner than later.

By-line: This article is contributed by Sarah Scrafford, who regularly writes on the topic of top 10 online universities. She invites your questions, comments and freelancing job inquiries at her email address: sarah.scrafford25@gmail.com.