New Immigrants to America - Establishing Credit By FederatedCreditCards.Com Copyright © 2008

Now days having good credit not only helps you obtain a credit card but is also used when you need to finance a car or house or even get a job. Good credit is more of a necessity rather than an option these days. There are three types of people who generally have trouble getting credit - students & young people, new immigrants to America, and those who are rebuilding their credit. Students and young people just simply do not have any credit history and haven't proved that are responsible enough yet. New immigrants come to America from all over the world including Latin America, Europe, and Asia, and are made up many cultures, hispanics, Chinese, Koreans, Vietnamese, and others. They may have had excellent credit history in their home country but when they arrive in America, it is a clean slate. USA Banks usually do not obtain foreign credit reports and will have no record of the credit history for new immigrants.

How do you establish and maintain good credit? Maybe you have been turned down for credit because your income is not high enough or you haven't been at your current address or job long enough. Maybe you are just entering the work force after being in college for four years. What is the best way to get a credit card? One way is to obtain a gas or department store credit card. They are easier to acquire than a major bank credit card. Make sure that you pay your bills on time and they will report positively to a credit bureau. Once you have established that you are responsible and will pay your bills then other companies will be more willing to give you a credit card.

If you are having trouble obtaining a store credit card, you may want to consider a secured credit card. This type of credit card requires you maintain a deposit at the bank which gives you the card. The credit limit usually coincides with the amount of money being held on deposit. Keep in mind that secured credit cards usually have an annual fee and may have a higher interest rate. It is not uncommon for them to charge an application fee as well. Do you have a relative with an established credit history? Consider asking them to co-sign a credit application for you. Keep in mind that the co-signer agrees to pay your debt should you be unable to do so.

Using a co-signer will also tie up the credit availability of the person who co-signs for you. This method should probably only be used for a short time until you can get a credit card on your own. After you have built some of credit history, then you are ready to apply for a bank credit card. Keep in mind that there are many promotions out there and that you should read each offer carefully. Although they might be offering you "free" rewards such as airline miles or hotel points for every dollar you spend, there is usually a catch such as a higher annual fee or maybe a higher interest rate. Over time you will be "paying" for the extra rewards that you are receiving. If you do not believe you will be able to pay off your credit card balance in full most months, it’s better to look for a low interest rate card instead of a rewards card. Some cash back cards have lower interest rates and can be a good option.

Keep in mind that you shouldn't try to acquire too many credit cards. Every time you submit a credit application, your credit report will reflect this. If there are too many inquiries, then this will cause your credit rating to go down. In addition, try not to spend most of your credit limit each month. Usually when starting out, credit limits are very low such as $200 or $300. If you charge 90% of your limit, then you may receive a mark on your credit report that you are utilizing most of your available credit. Once you obtain a credit card, it is very important to pay your bills on time to work towards a goal of having a high credit rating.

If you can't afford to pay your credit card by the end of the month, maybe you should rethink your purchase. If you abuse your credit, you will end up paying much more in the long run. If you act responsibly, you will be rewarded by being offered lower interest rates. It is in your best interest and in time will be financially rewarding!