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I have zero debt. Absolutely zero. However, I left the States soon after graduating university, and thus also have (had) no credit history there. Since I've bee

I have zero debt. Absolutely zero. However, I left the States soon after graduating university, and thus also have (had) no credit history there. Since I've been planning to return soon, I've been trying to build a history, so when the time comes, I can get a mortgage loan. The process of building a credit history has been enlightening and frustrating. I'm in the tech world, as most people in this forum is as well. I make a pretty decent salary in said tech world. However, I qualify for zero unsecured credit cards. I also don't qualify for any small personal loans. I attempted to get both in order to build a credit history. I mean, I can't even get a personal loan for $500. Nothing, nada, zilch. All I can do now is get a secured card and hold on to that for some time -- which is what I have been doing for about a year so far. However, I am constantly, and I mean constantly flooded with emails with special "pre-approved" credit cards and personal loans. I applied for a couple and of course was rejected. Oh, and of course, when you apply for these "pre-approved" offers, they do a credit check, which for some reason has a negative impact on your credit score. It's insane that we let 3 companies (Equifax, Experian, and Transunion) control so much of our lives, with little insight as to what their scores actually reflect. CreditKarma is just a vehicle within this sector. The entire system is broken and needs a complete overhaul.

JumpCrisscross 4y ago
> Nothing, nada, zilch. All I can do now is get a secured card and hold on to that for some time -- which is what I have been doing for about a year so far I started with a blank credit folio late in life. This was not my experience. It may make sense for you to speak to your bank or to a financial advisor.
- distantaidenn 4y ago
  I'm afraid a lot _might_ have to do with my registered address (zip code) in the States, when I try to apply. Inner city and all that. Edit: The rejection note that I normally receive is: insufficient credit history. To me it's a catch-22 situation. It always boggles my mind when I see 20 somethings with 10s of thousands of dollars in credit card and loan debt, while I can't even get in the door. Not saying I plan on having any debt, just that I would like the opportunity to receive a loan when I want it.
  - JumpCrisscross 4y ago
    > my registered address (zip code) in the States Are you applying from outside America? Playing devil’s advocate, a college friend skipped paying a bunch of loans by emigrating outside the reach of collectors. It informs why creditors are wary about lending to international clients with whom they have no prior relationship. Hence the advice to work through your bank and financial advisor; they know you, and that relationship builds trust.
    - deleted 4y ago
      [deleted]
  - kodah 4y ago
    I defaulted on debt and was in the military for a few years after 2008. I challenged my debt and won. When I started fresh I had a 500 credit score (which sounds like what you have). What I learned is that credit offers come to one of two kinds of people: people with really good credit and people with moderately shitty credit. If you have no credit then there's no offer for you. The best way I found to improve my credit was to pay bills. Things like a cellphone, rent, utilities, etc all get reported to credit bureaus. My working theory is that this case exists because they have no data to calculate and classify risk on you with.
    - SilasX 4y ago
      > When I started fresh I had a 500 credit score (which sounds like what you have). No, when your credit history is non-existent, the free credit score sites will happily tell you it’s much higher than that (mine was reported as 720-740 when I lacked history), but you’ll still get auto-rejected for everything. Interestingly, I emailed Arnold Kling, an economist writing about the subprime market at the time (2007) and he refused to believe that was happening, and insisted I must have some horrible default on my record. (I didn’t.) A 500 credit score from a default is much better than having no history. (I’m not the OP but was in a similar situation.)
      - distantaidenn 4y ago
ralph84 4y ago
Is there someone who lives in the US who can co-sign with you? It shouldn't be surprising that people who don't live in the US have trouble getting unsecured credit in the US. Creditors want to at least have the option of suing if there's a default. Suing someone who doesn't live in the country is a lot more complicated.
- distantaidenn 4y ago
  I'm American and 90% of my banking/bill payment is done on the US side. I still get plenty of snail mail to my US address, as well. I don't think the credit reporting agencies are aware of my physical location.
  - cmeacham98 4y ago
    Is your snail mail address an actual residence, or is it something like a PO Box?
    - distantaidenn 4y ago
      Actual residence. Childhood home.
jahewson 4y ago
So they way to do this - and what I did - is to not apply for anything other than a store card, e.g. Target, they gave me $300 credit - and use it regularly. After a year you’ll be able to get a regular credit card from your bank. Make sure to use it regularly, never make a late payment, and your credit rating will increase.
devoutsalsa 4y ago
Do you plan to buy a car? A car loan will establish your credit history. Car lenders will lend to anyone because they can always repossess the car. If you could buy a car with cash, take out a auto loan at any interest rate. Pay off the entire balance except $1. You’ll have no balance due each month, but each payment will be recorded as having been made on time. Then pay off the last $1 in the last month. Double check to whether this actually works, I haven’t done it and I’m just regurgitating something I saw in Reddit. Also make sure there’s no sort of prepayment penalty on the loan.
- cmeacham98 4y ago
  Your first paragraph is largely true if you're able to make a down payment (your car depreciates a ton as soon as you drive it off the lot, lenders will be much more willing to lend if amount of the loan is less than the value of the car sold _used_). The second is close to true, but you should actually leave a little over one month's payment, not $1. This SE answer explains it better than I ever could: https://money.stackexchange.com/a/59311 https://money.stackexchange.com/a/59311 (ignore the "Accepted" answer which contains awful advice).
  - NavinF 4y ago
    > ignore the "Accepted" answer which contains awful advice Yep. I love how the accepted answer with 130 votes totally ignores how credit scores work. I suppose it would be excellent advice if the OP never intends to get a home/car/cards and is too mentally impaired to handle a $1 loan.
  - philsnow 4y ago
    Do you have any idea having two new car loans improves your credit score any more than having one new car loan? OP might have enough income / savings to not be bothered at the idea of buying two new cars (they don't have to be Bentleys, people take out loans on Civics too). My gut says that having two of the same age wouldn't be much/any better than one, but then again it's the credit industry and my intuition has bitten me in the past.
NavinF 4y ago
> I've been planning to return soon > However, I qualify for zero unsecured credit cards. That’s normal. You don’t live in the US so American banks have zero recourse if you decide to default. For comparison, I had a very easy time getting 3 unsecured cards back when I was a 18 year old student with nearly zero income. It also helped that I had checking/savings accounts with the same banks and years of deposit history. > they do a credit check, which for some reason has a negative impact on your credit score You lose a few points, but hard pulls are the smallest component of your score. You can easily apply for 6 cards (2 per bureau) every 6 months before you start getting rejected. The “some reason” is obviously because people with many hard pulls are slightly more likely to default. IMO there’s no point complaining about losing 5 points from hard pulls when you’re losing 500 points because your AAoA (average age of accounts) is zero and no bank wants to take a leap of faith with someone they’ll never be able to put pressure on.
- distantaidenn 4y ago
  > That’s normal. You don’t live in the US so American banks have zero recourse if you decide to default. I'm American, and have no reason to believe the credit reporting services are aware of my physical location. This is evidenced by conversations I have had with various agencies (governmental, credit bureaus, etc.) over the past year. > For comparison, I had a very easy time getting 3 unsecured cards back when I was a student with nearly zero income. It also helped that I had checking/savings accounts with the same banks and years of deposit history. I've used the same primary bank for 20 years and counting.
  - NavinF 4y ago
    > have no reason to believe the credit reporting services are aware of my physical location So did you lie about your address on the credit card application? If not, that’s how the bank knows you don’t live in the US and that’s why you were rejected. Lemme simply: Either you need credit history in the US or you need to live in the US. You fail both criteria. Maybe your rejection letter only mentions the first reason, but banks definitely issue cards (with very low limits like $2k) to students with zero history. Speaking from experience. > same primary bank for 20 years Then walk in there and apply for a card after you get back in the US.
gnopgnip 4y ago
The banks don't just look at your credit score. They want you to be able to repay, and to be able to collect if you default. A regular job in the US, or 2 years as an independent contractor or self employed would qualify you for an unsecured credit card without a cosigner at most banks and credit unions. One trick if you have family that trusts you is to have them add you as an authorized user. Then their multiple year old account history for that account will be part of your credit, bringing up the average age
- NavinF 4y ago
  > their multiple year old account history for that account will be part of your credit, bringing up the average age Sorta. The most popular credit score (some version of FICO) ignores authorized user accounts so this doesn’t improve AAoA nor credit utilization. I guess too many people were taking advantage of this hack back in ~2012 lol. I suspect it’s still useful for initializing a credit report so you don’t get stuck having to verify your identity/address and improves your odds with the bank’s internal risk assessment.
  - gnopgnip 4y ago
    Fair isaac 08 and other newer scores no longer factors in authorized users. But 2, 4, 5 are what federal law requires lenders use for mortgage approval for most loans, they haven't approved the newer scores yet. https://www.fhfa.gov/PolicyProgramsResearch/Policy/Pages/Credit-Scores.aspx https://www.fhfa.gov/PolicyProgramsResearch/Policy/Pages/Cre...
uhuruity 4y ago
I am a grad student in the US and know several international students who qualified for unsecured student credit cards less than a year after first entering the US, with just a part-time student job as income.
deleted 4y ago
[deleted]
sjtgraham 4y ago
I got an AMEX Platinum Card with no US credit history and no SSN. It was my first US credit card but I'd had a lower tier AMEX card since 2006 in the UK, and AMEX will consider your history with them in other countries if you have no history in the US. 6-12 months after moving to the US and with a newly acquired SSN and no late AMEX payments, I was able to get the Chase Sapphire Reserve card and the Apple Card, which apparently require excellent credit. It's not as hard as you make it out to be
- distantaidenn 4y ago
  It's exactly as hard as I have made it out to be _for me_. I don't know what else to tell ya. Here's a fun read from DHH: https://twitter.com/dhh/status/1192540900393705474 https://twitter.com/dhh/status/1192540900393705474
daniel-cussen 4y ago
So your mistake is thinking, they have trademarks, they're American, they have documents are well formatted, no type-os, the advertise, they're incorporated, and more than anything they have money. But it's not like similar industries. It's the industry of treating you like shit. You are biomass to them, they want 20% interest while paying 1% interest (like two years ago), you can't compare saying it's a 19% spread what it is is the 18th power of the interest they pay. That's very abnormal historically, most usurers in the Middle Ages getting the whole town to kill them for their avarice had much skinnier spreads. 18th power is very unusual. Stretches out their time by a factor of 18. It's like street businesses, like crack dealing or pimping, which perpetually insult the people who are the foundation of their wealth.

JumpCrisscross 4y ago

> Nothing, nada, zilch. All I can do now is get a secured card and hold on to that for some time -- which is what I have been doing for about a year so far I started with a blank credit folio late in life. This was not my experience. It may make sense for you to speak to your bank or to a financial advisor.

distantaidenn 4y ago
I'm afraid a lot _might_ have to do with my registered address (zip code) in the States, when I try to apply. Inner city and all that. Edit: The rejection note that I normally receive is: insufficient credit history. To me it's a catch-22 situation. It always boggles my mind when I see 20 somethings with 10s of thousands of dollars in credit card and loan debt, while I can't even get in the door. Not saying I plan on having any debt, just that I would like the opportunity to receive a loan when I want it.
- JumpCrisscross 4y ago
  > my registered address (zip code) in the States Are you applying from outside America? Playing devil’s advocate, a college friend skipped paying a bunch of loans by emigrating outside the reach of collectors. It informs why creditors are wary about lending to international clients with whom they have no prior relationship. Hence the advice to work through your bank and financial advisor; they know you, and that relationship builds trust.
  - deleted 4y ago
    [deleted]
- kodah 4y ago
  I defaulted on debt and was in the military for a few years after 2008. I challenged my debt and won. When I started fresh I had a 500 credit score (which sounds like what you have). What I learned is that credit offers come to one of two kinds of people: people with really good credit and people with moderately shitty credit. If you have no credit then there's no offer for you. The best way I found to improve my credit was to pay bills. Things like a cellphone, rent, utilities, etc all get reported to credit bureaus. My working theory is that this case exists because they have no data to calculate and classify risk on you with.
  - SilasX 4y ago
    > When I started fresh I had a 500 credit score (which sounds like what you have). No, when your credit history is non-existent, the free credit score sites will happily tell you it’s much higher than that (mine was reported as 720-740 when I lacked history), but you’ll still get auto-rejected for everything. Interestingly, I emailed Arnold Kling, an economist writing about the subprime market at the time (2007) and he refused to believe that was happening, and insisted I must have some horrible default on my record. (I didn’t.) A 500 credit score from a default is much better than having no history. (I’m not the OP but was in a similar situation.)
    - distantaidenn 4y ago

ralph84 4y ago

Is there someone who lives in the US who can co-sign with you? It shouldn't be surprising that people who don't live in the US have trouble getting unsecured credit in the US. Creditors want to at least have the option of suing if there's a default. Suing someone who doesn't live in the country is a lot more complicated.

distantaidenn 4y ago
I'm American and 90% of my banking/bill payment is done on the US side. I still get plenty of snail mail to my US address, as well. I don't think the credit reporting agencies are aware of my physical location.
- cmeacham98 4y ago
  Is your snail mail address an actual residence, or is it something like a PO Box?
  - distantaidenn 4y ago
    Actual residence. Childhood home.

jahewson 4y ago

So they way to do this - and what I did - is to not apply for anything other than a store card, e.g. Target, they gave me $300 credit - and use it regularly. After a year you’ll be able to get a regular credit card from your bank. Make sure to use it regularly, never make a late payment, and your credit rating will increase.

devoutsalsa 4y ago

Do you plan to buy a car? A car loan will establish your credit history. Car lenders will lend to anyone because they can always repossess the car. If you could buy a car with cash, take out a auto loan at any interest rate. Pay off the entire balance except $1. You’ll have no balance due each month, but each payment will be recorded as having been made on time. Then pay off the last $1 in the last month. Double check to whether this actually works, I haven’t done it and I’m just regurgitating something I saw in Reddit. Also make sure there’s no sort of prepayment penalty on the loan.

cmeacham98 4y ago
Your first paragraph is largely true if you're able to make a down payment (your car depreciates a ton as soon as you drive it off the lot, lenders will be much more willing to lend if amount of the loan is less than the value of the car sold _used_). The second is close to true, but you should actually leave a little over one month's payment, not $1. This SE answer explains it better than I ever could: https://money.stackexchange.com/a/59311 https://money.stackexchange.com/a/59311 (ignore the "Accepted" answer which contains awful advice).
- NavinF 4y ago
  > ignore the "Accepted" answer which contains awful advice Yep. I love how the accepted answer with 130 votes totally ignores how credit scores work. I suppose it would be excellent advice if the OP never intends to get a home/car/cards and is too mentally impaired to handle a $1 loan.
- philsnow 4y ago
  Do you have any idea having two new car loans improves your credit score any more than having one new car loan? OP might have enough income / savings to not be bothered at the idea of buying two new cars (they don't have to be Bentleys, people take out loans on Civics too). My gut says that having two of the same age wouldn't be much/any better than one, but then again it's the credit industry and my intuition has bitten me in the past.

NavinF 4y ago

> I've been planning to return soon > However, I qualify for zero unsecured credit cards. That’s normal. You don’t live in the US so American banks have zero recourse if you decide to default. For comparison, I had a very easy time getting 3 unsecured cards back when I was a 18 year old student with nearly zero income. It also helped that I had checking/savings accounts with the same banks and years of deposit history. > they do a credit check, which for some reason has a negative impact on your credit score You lose a few points, but hard pulls are the smallest component of your score. You can easily apply for 6 cards (2 per bureau) every 6 months before you start getting rejected. The “some reason” is obviously because people with many hard pulls are slightly more likely to default. IMO there’s no point complaining about losing 5 points from hard pulls when you’re losing 500 points because your AAoA (average age of accounts) is zero and no bank wants to take a leap of faith with someone they’ll never be able to put pressure on.

distantaidenn 4y ago
> That’s normal. You don’t live in the US so American banks have zero recourse if you decide to default. I'm American, and have no reason to believe the credit reporting services are aware of my physical location. This is evidenced by conversations I have had with various agencies (governmental, credit bureaus, etc.) over the past year. > For comparison, I had a very easy time getting 3 unsecured cards back when I was a student with nearly zero income. It also helped that I had checking/savings accounts with the same banks and years of deposit history. I've used the same primary bank for 20 years and counting.
- NavinF 4y ago
  > have no reason to believe the credit reporting services are aware of my physical location So did you lie about your address on the credit card application? If not, that’s how the bank knows you don’t live in the US and that’s why you were rejected. Lemme simply: Either you need credit history in the US or you need to live in the US. You fail both criteria. Maybe your rejection letter only mentions the first reason, but banks definitely issue cards (with very low limits like $2k) to students with zero history. Speaking from experience. > same primary bank for 20 years Then walk in there and apply for a card after you get back in the US.

gnopgnip 4y ago

The banks don't just look at your credit score. They want you to be able to repay, and to be able to collect if you default. A regular job in the US, or 2 years as an independent contractor or self employed would qualify you for an unsecured credit card without a cosigner at most banks and credit unions. One trick if you have family that trusts you is to have them add you as an authorized user. Then their multiple year old account history for that account will be part of your credit, bringing up the average age

NavinF 4y ago
> their multiple year old account history for that account will be part of your credit, bringing up the average age Sorta. The most popular credit score (some version of FICO) ignores authorized user accounts so this doesn’t improve AAoA nor credit utilization. I guess too many people were taking advantage of this hack back in ~2012 lol. I suspect it’s still useful for initializing a credit report so you don’t get stuck having to verify your identity/address and improves your odds with the bank’s internal risk assessment.
- gnopgnip 4y ago
  Fair isaac 08 and other newer scores no longer factors in authorized users. But 2, 4, 5 are what federal law requires lenders use for mortgage approval for most loans, they haven't approved the newer scores yet. https://www.fhfa.gov/PolicyProgramsResearch/Policy/Pages/Credit-Scores.aspx https://www.fhfa.gov/PolicyProgramsResearch/Policy/Pages/Cre...

uhuruity 4y ago

I am a grad student in the US and know several international students who qualified for unsecured student credit cards less than a year after first entering the US, with just a part-time student job as income.

deleted 4y ago

[deleted]

sjtgraham 4y ago

I got an AMEX Platinum Card with no US credit history and no SSN. It was my first US credit card but I'd had a lower tier AMEX card since 2006 in the UK, and AMEX will consider your history with them in other countries if you have no history in the US. 6-12 months after moving to the US and with a newly acquired SSN and no late AMEX payments, I was able to get the Chase Sapphire Reserve card and the Apple Card, which apparently require excellent credit. It's not as hard as you make it out to be

distantaidenn 4y ago
It's exactly as hard as I have made it out to be _for me_. I don't know what else to tell ya. Here's a fun read from DHH: https://twitter.com/dhh/status/1192540900393705474 https://twitter.com/dhh/status/1192540900393705474

daniel-cussen 4y ago

So your mistake is thinking, they have trademarks, they're American, they have documents are well formatted, no type-os, the advertise, they're incorporated, and more than anything they have money. But it's not like similar industries. It's the industry of treating you like shit. You are biomass to them, they want 20% interest while paying 1% interest (like two years ago), you can't compare saying it's a 19% spread what it is is the 18th power of the interest they pay. That's very abnormal historically, most usurers in the Middle Ages getting the whole town to kill them for their avarice had much skinnier spreads. 18th power is very unusual. Stretches out their time by a factor of 18. It's like street businesses, like crack dealing or pimping, which perpetually insult the people who are the foundation of their wealth.