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If you're a new immigrant to the U.S. and you're looking for a credit card, there are options available. Unfortunately, though, your credit history from your home country doesn't transfer to the U.S., so credit card choices can be limited.
With the right card, you can work to establish your credit score in the U.S. by using the card responsibly, paying your bills on time and avoiding unnecessary borrowing. Over time, you'll be able to establish a credit history and increase your chances of getting other forms of credit when you need it.
Credit Cards You Can Get With a Social Security Number
Most credit cards in the U.S. require a Social Security number (SSN). If you've already obtained an SSN, you'll have a wider selection from which you can choose.
That can include a secured credit card like the Capital One Platinum Secured Credit Card. When you first sign up, you'll need to provide a security deposit starting at $49 to get a $200 line of credit. You may be considered for a higher line of credit in as little as six months and may even receive your deposit back as a statement credit without needing to close the account.
If you don't have cash for a security deposit, the Milestone® Gold Mastercard® is a traditional unsecured card that doesn't require a deposit and is available to those who are building or rebuilding their credit. It charges a $35-$99 annual fee.
Consider using a tool like Experian CreditMatch™ to get an idea of which cards you might qualify for.
Credit Cards You Can Get Without a Social Security Number
If you haven't obtained an SSN yet, you'll still have options, though they're somewhat limited.
One option designed specifically for international students is the Deserve® EDU card. The card doesn't require an SSN, and it also comes with some solid benefits. Cardholders will earn 1% cash back on all of their purchases, get a complimentary one-year membership to Amazon Prime Student, pay no transaction fees on international purchases and get insurance protection for their cellphone.
Take your time to research and compare your options to determine the right one for you.
How to Use a Credit Card to Build Credit
While it can be challenging to get a credit card as an immigrant to the U.S., consider making it a priority as you get established.
Managed responsibly, credit cards offer an excellent way to build credit. And as long as you pay your balance on time and in full every month by the due date, you'll never be charged interest or late fees.
As you start using your new credit card, here are some tips to help you build a positive credit history:
- Always pay on time. As previously mentioned, this is key to avoiding interest, but it's also important for building your credit history. Your payment history is the most influential factor in your FICO® Score☉ , which is the credit score used by 90% of top lenders. Consider setting up automatic payments from your bank account to avoid missing one. If you do miss a payment, get caught up immediately—as long as you're not late by 30 days or more, it won't hurt your credit score (though your card issuer may charge a late fee).
- Keep your balance low. The second most important factor in your FICO® Score is your credit utilization rate. This is the percentage of your available credit you're using at a given time. So if you have a $200 limit and a $100 balance, your utilization rate is 50%. The lower the rate is, the better it is for your credit score—and it's best to keep your utilization rate under 30% at all times. Unfortunately, it can be difficult to keep a low utilization rate on a card with a low credit limit. Consider using the card sparingly until you can get a higher limit, or make it a goal to make multiple payments throughout the month to keep your balance low.
- Hold off on getting many new credit cards. Over time, adding more credit accounts to your plate can help improve your credit score. But for now, it might be best to focus on just one account as you get used to the credit system. If you apply for multiple credit cards or open multiple card accounts in a short period, it can have a negative effect on your credit score.
- Get added as an authorized user. If you have a loved one in the U.S. who has an established credit card account, consider asking them to add you as an authorized user on their account. When this happens, the entire history of the account will be added to your credit reports and can help establish your credit history and score. This option is best if you know your loved one uses the card responsibly, keeping balances low and making all payments on time.
As you work on building your credit history, check your credit score often to keep track of your progress. Over time, you'll have a better idea of when it makes sense to get a second credit card or another type of credit to continue on your credit journey.
Use a Credit Monitoring Tool for Easier Tracking
As you work to establish your credit history, keeping track of your score and reports is important. One easy way to do this is with Experian's free credit monitoring service. In addition to providing you access to your FICO® Score and Experian credit report, you'll also get real-time alerts when certain changes are made to your report.
As you learn more about how your actions impact your credit score and the different steps you can take to improve your credit, you'll have a better chance of setting yourself up for financial success.
The information related to the Deserve® EDU credit card has been collected by Experian and has not been reviewed or provided by the issuer of the card.