If you are an international student studying in the United States, you may want to consider applying for a credit card for the length of your stay. Applying for a credit card in the US can be an intimidating concept for many international students, particularly those from countries that are largely run on cash or debit cards. The United States is a largely cashless society, and having a credit card for the length of your stay will be extremely convenient, and it is essential in establishing a line of credit (especially if you want things like a mobile phone, or to buy a house).
So here are the steps to follow in order to get yourself on the credit ladder in the USA and secure a credit card:
Step 1 - Apply for a Social Security Number
If you are not employed or have an SSN, never fear! Some banks will be willing to waive the SSN requirement for you.
The major requirement that banks have for applying for a credit card in the US is a Social Security Number (SSN). SSNs are assigned to people who are authorized to work in the US, and are used to report your wages to the government and to determine eligibility for Social Security benefits. If you are a student studying in the US on an F-1, M-1, or J-1 student visa, and are authorized to work in the US, you can apply for an SSN.
In order to apply for an SSN, you must first have employment in the US (for off-campus employment, you are going to have to receive authorization from the Department of Homeland Security). To apply for an SSN, you will need to complete an Application for a Social Security Care (Form SS-5) and show documents proving your work-authorized immigration status, age, and identity. You will then take your application and documents to your local Social Security office.
Step 2 - Apply for Credit Cards
Do not apply for too many cards at once as it can negatively impact your credit!
When applying for a credit card, you will need to provide a permanent address; you can use your school address for this. Having
a steady source of income and a checking or savings account will boost your chances of being accepted. It is also a good idea not to apply for too many cards at once, because too many rejections will negatively affect your chances of another financial institute accepting your application. Try to submit only one or two applications, particularly for cards designed for students with lower credit lines.
You should also consider applying online on a secured site. This way, your personal data goes straight to the financial institute, eliminating the risk of a third party obtaining your information and reducing the possibility of identity theft.
Step 3 - Wait!
Once you have followed those steps, you will just need to wait for the approval decision. As an international students just coming into the USA, it can be very hard to secure credit, and you may find that you will be rejected from many banks. A few tips to help you overcome this are:
Secured Credit Cards
For many international students, it is difficult to get a credit card in the US because they have not yet spent time building up a credit history and because they are not US residents. You may want to consider using a “secured credit card.” The cards offer some of the conveniences of a credit card, but you secure your card with a deposit that becomes your credit line. These cards are reported as regular credit cards on your credit report.
Building a Credit History
Building a credit history is essential for many things in the US, including securing housing and utilities. To help you with this, you will want to manage your card balances wisely. Because of the convenience of credit cards, it is easy to overspend and not pay your balances on time. Remember that when you use your credit card, you end up owing that money. It is generally a good idea to avoid spending more than 30% of your spending limit. For example, if you have a card with a maximum spending limit of $300, you should charge more than $90 to that card in a month. It is also imperative that you pay your balance on time.