Building Credit, from Scratch
When I moved from the UK to the United States, I obviously had to go through immigration and when it was all over, I had a Social Security number just like my wife (a U.S. Citizen by birth) given to me and unlike most people, I’m a 29-year old adult with income, yet I have no Credit Rating or record whatsoever.
Being given this opportunity to start from scratch, it was a bit daunting. I don’t want to do anything wrong and delay buying a house in a few years and I don’t want to accept credit I don’t need, or risk just screwing things up.
As soon as I knew I’d be getting a Social Security number (SSN), I started trying to find out how to build credit from scratch, as an adult, but found no advice on how to do this at all!
So, let me tell you what I have found out, because who knows, it might help somebody!
First, open a bank account. This is the first step for Credit Building and really needs to always be the first piece of information shown. It shows you have some kind of income (otherwise, you wouldn’t need a bank account).
Second, consider opening a Secure Credit Card account. Normally, a secure credit card is done by giving a bank a minimum deposit of around $300, they hold this money in a Savings Account and give you a Credit Card with a Credit Limit matching whatever you have in the Savings Account. The Secure Credit card shows on your Credit Record as a normal credit card. You should ALWAYS pay at least the minimum monthly payment, but should try at all times to pay the whole balance. NEVER pay late on anything.
If you need additional help with your Credit Rating, consider opening a second secure credit card.
The best way to use your Secure Credit Card (or any Credit Card) is for something like bills or groceries. Make sure you have the cash for the bills of groceries anyway and put the money aside so you can pay full balance. The nice thing is, your $300 is in a savings account, gaining interest!
Tags: Banks, Credit Cards, Credit Ratings, Immigration, Savings, Secure Credit Cards, Social Security, SSN