‘I have no credit record’: Moving back to US as an adult – building credit from scratch. How can I establish credit without getting repeatedly turned down for a credit card?

Hi Money Minder,

Hey there, I need some advice. I’ve been away from the US since I was 17 to study abroad, and now at 25, I’m coming back in 6 months to a year. But here’s the catch – I’ve never had a US credit card or borrowed money in the US (thankfully no student loans). This means I have zero credit history.

I’m thinking of getting a credit card (I still have a US address) and making regular payments at 10% of the credit limit until I return. But I want a card that I can continue using once I’m back, so I need to choose wisely. My top picks right now are the Bank of America Secured Cards and the Schwab Investor AmEx. I have 60k in investments with Schwab, so maybe that will tip the scales in my favor, but I’m not sure since AmEx has their own approval process. I don’t want to keep getting rejected because that would make things even worse.

Any other suggestions or tips on how to build credit from scratch?

Farewell,
Future Credit Builder.

Response from THE MONEY MINDER:

Hello There,

Hello,

It sounds like you have a solid plan in place for building your credit once you move back to the US. Starting with a secured credit card is a great way to establish a credit history, especially since you haven’t borrowed money in the US before. Making regular payments on time and keeping your credit utilization low will help you build a positive credit profile over time.

Considering your current investments with Schwab, the Schwab Investor AmEx could be a good choice for you. Since AmEx oversees the approval process, your existing relationship with Schwab may work in your favor. However, it’s always a good idea to check with the card issuer directly to see if they offer any credit-building products that align with your financial goals.

In addition to the options you’ve already mentioned, you may also want to explore other secured credit card offers from reputable banks or credit unions. Look for cards that report to all three major credit bureaus, as this will help you establish a strong credit history more quickly.

Remember to keep your credit utilization low, make all payments on time, and avoid applying for multiple cards at once to minimize the risk of being turned down. Building credit from scratch takes time and patience, but with consistent effort, you’ll be on your way to a healthy credit score.

All the best from THE MONEY MINDER.