Building US credit as a newcomer: the first twelve months

When you arrive in a new country, your credit record often stays behind. A bank that knows nothing about you has to treat you as someone with no history, which is why many newcomers find it hard to get a card, a phone plan or an apartment at first. The fix is a plan, and then patience.

A twelve-month plan

1. Month 0

   Open a bank account

   A checking account with a local address and ID gives you a base for bills and card payments.

2. Months 1 to 2

   Apply for a starter card

   A secured or student card. Ask whether it reports to the bureaus. See secured credit cards.

3. Months 2 to 6

   Use it a little

   Put one small recurring bill on the card, and pay the full statement each month.

4. Months 6 to 12

   Check your file

   Pull your reports, confirm the account is listed and ask about an upgrade.

1. 1

   Get the identity documents in order

   You will need a passport, proof of address and, depending on your situation, a Social Security number or taxpayer number.

2. 2

   Choose a card that suits a thin file

   Look for a secured or beginner card with low fees, and check that it reports to all three bureaus.

3. 3

   Set up autopay

   Pay at least the minimum automatically, ideally the full statement, so a late payment never happens by accident.

4. 4

   Keep usage low

   Stay below about 30% of the limit, and a lower share is better. See credit utilization.

5. 5

   Wait and review

   After six months, ask the issuer about moving to an unsecured card, and check your reports.

Mistakes that cost newcomers

• Applying everywhere at once. Several hard inquiries on a new file stand out. Apply for one card first.

• Paying late once. On a thin file, one late payment weighs a lot. Use autopay.

• Using a card for cash. Cash advances start charging interest at once and may carry a fee.

• Assuming a score exists. Check with the bureaus before you rely on a number.

Your first-month checklist

• Open a checking account with a local address.

• Gather your passport, address proof and any tax number.

• Ask each issuer whether it reports to all three bureaus.

• Set up autopay and a calendar reminder.

Be patient. Many newcomers see a first score within months, and the real progress comes as the history grows, year after year.