Whether you are a recent immigrant to the United States or you have been here for a long time, you can take steps to build positive credit. Having a high credit score will help you with your financial decisions in the future, whether you need to take out a loan to go to college or apply for a mortgage to purchase a home.
Many individuals, both immigrants and native-born Americans alike, do not know how to build their credit. If you are not sure where to start with building your credit, apply the following tips to your everyday life.
Consider a Secured Credit Card
If you do not have sufficient credit to qualify for an unsecured credit card, apply for a secured credit card. A secured credit card is a credit card that an applicant can obtain by putting down a sum of money as collateral with the lender. That sum of money then becomes his or her credit limit. For example, you can apply for a secured credit card with a $500 credit limit with the bank by giving the bank $500 in cash to use as collateral. Because of this collateral, anybody can open a secured credit card and begin building positive credit.
Pay your Bills on Time
Your rent, your utility bills, your credit card bills, and any other bills you have need to be paid on or before their due dates. This is key to building and maintaining positive credit. With credit card bills, it is possible to pay less than what is due, known as the “minimum payment.” This amount is printed on your credit card bill, but do not let yourself get into the habit of only paying the minimum payment each month – allowing your debt to accrue will actually cost you more money in the long run because you will need to pay interest on the balance you carry on your credit card.
Pay your Bills in Full
This goes with the issue above – not only should your credit card bills be paid on time, they should be paid in full. Alongside the issue of having to pay interest on debt accrued, you can also lose track of how much you owe to your lender and reach the point of “maxing out” your credit card.
Become an Authorized User on Another Person’s Card
If possible, you can also build your own credit score by becoming an authorized user on somebody else’s card. This other party could be your spouse or another relative, such as a parent or a sibling. Establish an agreement with this other party beforehand. As an authorized user of their credit card, you are not legally obligated to pay for the charges you make – they are. Discuss how you will reimburse him or her before you become an authorized user.
Work with a Skilled Immigration Attorney
Having a strong credit score can help you immensely when you need to take big steps with your finances. For guidance with the legal issues that can accompany these steps or other types of help during the immigration process, contact immigration attorney Joshua L. Goldstein at Goldstein Immigration Lawyers today to set up your legal consultation.