Building Credit As An International Student
June 25th, 2014 by Jennifer Frankel
You may be surprised at how frequently Americans whip out a debit or credit card from their wallet for the majority of their purchases, even for seemingly small things, like their morning coffee. Many other countries rely largely on cash, thus the idea of credit, credit cards and credit scores may literally be a foreign concept.
However, learning about credit and how to earn the best score possible doesn’t have to be scary – it’s simpler than you may think! Just remember that you have many options when building credit as an international student.
If you are enrolled in a degree program in the U.S., your respective university or college should have information on international student credit cards. This type of credit card usually has a low credit limit to start off, but as the student and cardholder exhibits good behavior, i.e., making payments on time, the limit should rise accordingly.
In general, there are many student credit cards on the market and most banks and lending institutions should allow you to apply for and obtain a credit card with a Tax Identification Number (TIN). You can receive a TIN if you have an international student visa.
Basic Rules To Build And Maintain Good Credit:
- Always make your monthly payments on time.
- Try to end each month with your balance at $0.00.
- Don’t make purchases with your credit card that you will not be able to pay off in a timely fashion.
- Only use 30% of your total credit limit, if possible.
Renting An Apartment
Renting an apartment or house is another way to build credit in the U.S. When you are looking for housing, make sure that the landlord understands you are an international student. They typically run a credit check on all potential tenants, and without a financial history, the credit check will reveal little to nothing. In these cases, a standard security deposit should be sufficient to balance a lack of credit.
Do you plan on staying in the U.S. long-term? We may sound like a broken record, but it’s imperative that you pay every bill on time. Being late or faulting on payments can greatly affect your future in the U.S., especially if you decide to work or start a life here after completing your studies. The simple truth about a credit score is that it’s easy to damage, but difficult to rebuild, so it’s best to start on a good note!