How to Start a Credit History in the U.S.
Whether you’re new to the country or just new to credit, these are the steps you should take to build credit quickly.
In the financial world of the United States, establishing credit is almost a “necessary evil.” It’s necessary because a credit card is convenient when you are renting a car, making reservations for a hotel or even getting your telephone or electricity turned on in your house – otherwise you’ll be paying a large deposit to the phone or electric company. It’s evil because debt problems and fraud are highly associated with credit cards.
In order to help you establish a healthy credit history in the U.S., Consolidated Credit created this guide for those of you who are new to managing your money in the U.S. If you ever get into trouble or just have questions about how to avoid problems, we can help. Call Consolidated Credit today at (844) 276-1544 to speak confidentially with a certified credit counselor for free.
Understanding credit reporting in the U.S.
One of the reasons credit is so widely available in the United States is because we have a strong credit reporting system. Credit reporting agencies (also known as “credit bureaus”) are companies that collect information about how consumers pay their bills and then they sell that information in the form of a credit report to businesses that may use them for credit, insurance, or employment purposes. The top three bureaus are Equifax, Experian, and TransUnion.
We offer a complete section on Credit Reports to help you understand what information appears in your reports and what it means. For this overview, it’s just important to note that if you don’t pay your credit card bill or car loan on time, the lender will report it and negative information will appear in your credit report. Late payments stay on your credit report for seven years and can make your financial life miserable. Lenders can refuse to extend other lines of credit and increase your interest rates.