Nova Credit is a cross-border credit bureau that allows newcomers to apply for U.S. credit cards, phone plans, and loans using their foreign credit history.
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If you have recently moved to the United States for school, work, or family, your credit history from your home country will not move with you.
Without a U.S. credit history, it will be difficult to access many essentials, such as housing, credit cards, loans, and even employment opportunities. You might be charged high interest rates, asked for a high security deposit for a rental or, even worse, be rejected for products altogether.
Fortunately, there are several ways to begin building a U.S. credit history as soon as you’ve moved. You do not even need a Social Security Number to get approved for a U.S. credit card and start building your credit history in the U.S. The main U.S. credit bureaus, Experian, Equifax, and TransUnion, will track and attempt to match your name, birth date, and address to your credit history.
This article will discuss four different ways to build credit in the U.S. and help guide you to the right option for you:
Use your foreign credit history in the U.S.
Apply for a secured credit card
Establish a relationship with a U.S. bank
Apply for U.S. credit with a co-signer
1. Use your foreign credit history in the U.S.
If you move from certain supported countries, you might be able to use your existing credit from abroad to apply for U.S credit products using Nova Credit. With your consent, Nova Credit can translate your foreign credit data into a U.S. format and share it with lenders when you apply for credit cards, loans, and other products from its partners.
Once approved for a U.S. credit account, you can begin to establish your U.S. credit history by responsibly managing that account. This includes paying off your balance every month whenever possible and keeping your credit utilization low. More on that below.
Nova Credit currently provides this service to newcomers from Australia, Brazil, Canada, Dominican Republic, India, Kenya, Mexico, Nigeria, Philippines, South Korea, Switzerland, and the U.K.
You can use your foreign credit history from eligible countries to apply for an American Express ® Personal Card in the U.S.
2. Apply for a secured credit card
If you cannot use your foreign credit history through Nova Credit, consider applying for a secured credit card to help build your U.S. credit history. These cards require you to put down a cash deposit at your bank account or credit union. Your spending limit is generally the amount that you have deposited.
Important: Make sure that the issuers of your secured card report your payment history to at least one of the three major U.S .credit bureaus: Equifax, Experian, or TransUnion. If they don’t disclose this information on their websites, you can reach out to their customer support team for clarification. Unless your payment history is reported, the secured card won’t help you build a U.S. credit score.
After a few months of making on-time payments on your secured card, you may become eligible for a credit card that doesn’t require a security deposit.
Also read: Great secured cards
Put your foreign credit score to work in the United States
Check if you're eligible to use your foreign credit history to apply for a U.S. credit card.
3. Establish a relationship with a bank
Opening a checking or savings account with a bank may help you build your credit history. As you build a relationship with the bank early on, you start signaling financial stability and open up the possibility of getting a credit card or loan down the line.
While choosing a bank or credit union, consider your priorities. Does it have accessible ATMs? Does it have good customer service? What about monthly or annual fees?
Look out for banks or credit unions that can accept multiple forms of documentation for immigrants. Stopping by a local bank branch and explaining your situation can sometimes be more effective than applying online because bank agents can often easily check whether or not they can pre-approve you for a card in person.
Important: After you open a checking account, you should be careful to not overdraw as this may negatively impact your U.S. credit report.
4. Apply for U.S. credit with a co-signer
Another way to make it easier to get a new credit product is to apply with a co-signer who already has gone through the process of establishing credit in the U.S. When you list someone with an established U.S. credit footprint as part of your credit application, you can benefit from their good credit history.
Before applying, however, make sure your co-signer knows what he or she is getting into -- a co-signer agrees to be responsible for your debt if you don’t pay your bills. Research co-signer options when you apply for different credit cards or loans.
Pay on time, monitor and change products, and be patient
You’ll officially begin building credit in the U.S. as soon as you have a credit product (credit card, student loan, mortgage, etc.) that is being reported to the major U.S. credit bureaus.
Make your payments on time to demonstrate your creditworthiness and build a good credit history. If you have a credit card, aim to generally use it at least once a month to demonstrate that you know how to use credit responsibly over time. Be sure to also check your payment due date so you don't miss a bill. Many providers will let you set up an automatic recurring payment from your checking account to ensure that you don't fall behind.
Another important factor in your credit score is your credit card utilization: a good rule of thumb is to not use more than 10% of your limit. Rent reporting may also affect your credit score, so making sure your monthly rent payments are on time may be important to establishing a good credit score.
Check your credit score regularly and look at credit card offers with a higher credit limit, as these help to keep your utilization low. To help monitor your credit and explore other products, you can use the free credit score and monitoring tools from Credit Karma or NerdWallet (among others).
Keep in mind that it can take multiple years to get back to the credit score that you had in your home country. Be patient, stay on top of managing your credit accounts, and you will get there in due time.
Having a credit history is critical in the U.S., so make sure you start to build one as soon as you arrive. You can do this by applying for U.S. credit products and responsibility managing them once approved.
You may be able to apply for credit products in the U.S. via Nova Credit using your foreign credit history if you have a credit history abroad. This will help you get premium products from day one and kickstart your credit-building journey here in the U.S.
If you can't use our service, you should explore various methods of building credit from scratch—from applying for a secured card to finding a co-signer or establishing a relationship with a bank.
Invest time in smart credit products and be diligent in monitoring your score. Good luck on your journey!
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