Credit Score 742: The United States finally welcomes me (and my money)

It’s a funny thing living in the United States of America as a visa holder. As neither citizen nor green card possessor, you are an “alien” or, more accurately, a “legal alien”.

This no-man’s-land status brings with it certain absurdities. When I arrive back from a trip abroad, for example, I am questioned as if it’s the first time I’ve ever been here. The best part is when I am asked where I reside. Clearly, I live in the US. I have a one-year lease on a property here. But due to my status, I have to pretend that I actually live in the UK and this is like a really long holiday.

The worst part of living in America as a legal alien though is the loops you have to jump through when you first arrive. I meant to write a post about this back in December – eight months ago and two months after I’d arrived – but the whole thing was so dreadful I couldn’t muster the energy.

Here is but one example.

If you want to get a credit card you have to:

  1. Provide the capital upfront as you don’t have a “credit score” in the US system
  2. To do this you have to have a bank account.
  3. To get a bank account you have to have a Social Security Number (SSN).
  4. To get an SSN you have to go to a social security office and apply for one.
  5. To be accepted for an SSN you have to have a visa.

This all sounds sort-of reasonable except for the time delays. You can only apply for an SSN in person. And then it takes at least four weeks before you are granted it (in my case, six weeks). It then takes at least a week to receive it (at which address, you ask? Because you can’t rent because you don’t have an SSN). It then takes at least a month for the SSN to get into the banking system (in my case, six weeks). Once it is in the system, it takes a week to get a yes or no on the credit card. And when you have done all that, you still have to pay the money upfront in a non-interest-bearing account to be allowed to pull credit on your own money.

Result: Credit on your own money. Time taken: 4 months

Why do you go through all this? To build up your credit score. And here is where you enter another peculiar world – the credit scoring system. All US citizens are so familiar with their credit scoring system that they look at you as if you really are an alien if you raise it or question it.

Very briefly, the credit scoring is, as everywhere else, a measure of your personal credit worthiness based on interactions you have had with financial system over time: credit cards, utility bills, loans, business interactions and so on. Companies use it as a guide in deciding whether to loan you money. Fair enough.

Except the US system is entirely self-contained. So while I am a tremendous credit opportunity in Europe thanks to over 20 years of spending, in the US I am treated as if I have never had a dollar in my life. I don’t exist to provide money to. Yes, I can buy stuff. I can even pay hefty taxes to the IRS. But if I need money to, say, buy a car, or rent a place, or start a business, or buy anything beyond my own immediate financial means, forget it.

But this is the best part: because you have no credit score, you can’t get anything – a loan or credit card for example – that enables you to get a credit score. So you end up stranded in the middle of a financial vicious circle. All immigrants to the US go through the same thing – presenting the less scrupulous with a grand opportunity to rip them off. One result of this is that immigrant populations stick closely together, setting up their own internal financing systems in order to help people get on the credit ladder.

What does this have to do with me?

Well, almost 10 months to the day that I arrived in the United States, and having been trying to attain one in all that time, I have finally received a credit score. And it’s a cracker: 742.

I was told it would take six months of using my secured credit card to get onto the credit system, and so it has been. I also have a Time Warner cable bill that must have something to do with it (I had to actually pay Time Warner $50 to install the system so I could then pay them for their service because I didn’t have a credit score).

I have checked occasionally this year to see if I had a score yet: nothing each time. But about three weeks ago, I started getting offers for credit cards at stupidly high rates of interest – 20.3 percent, 18.9 percent – which led me to believe something was up. And then last week I checked and there it was: a credit score.

What does 742 actually mean? Well, the scoring system stretches from 300 to 850+. And that does mean “850+”, they don’t appear to give scores above that. God alone knows how you manage to get a score of 300-400 because no one will lend you even a shopping bag if you are under 550. It’s not even sub-prime. It’s leave the country or change your identity time. People with this score have really screwed up somewhere.

The difficult zone is 550-650. This is where the poor reside in the United States. Just over 20 percent of the people find themselves in this dreadful bracket where the riches and opportunities of the world’s most affluent nation are kept infuriatingly out of reach while you still receive your daily dose of marketing, advertising and related capitalist propaganda.

The 650-750 bracket is where everyone else settles. The average credit score across the whole system is 723. As a result, if you get above 720, the financial possibilities open up and provide you with the opportunity to tap the extraordinary and admirable American trait of financial risk-taking that is such a part of the culture and has made this nation such an economic powerhouse.

And then there is 750 and above, where, unless you are looking to buy a $2 million house, you can pretty much guarantee companies will welcome you with open arms. So long as you keep that score up with regular payments, and by building up more and more credit until you are so tied into the system you will never escape, you can count on salesman being your best friend even when you have left the store and they run your check.

So, the US has finally, in some small measure, welcomed me to its bosom. Of course the irony that this comes just as the country is slipping into recession and no one is in a position to lend anyone anything is not lost on me. Nonetheless, 742 means that I am no longer an outsider.

It also means I can start getting back all the money these bastards have taken as “security” off me over the past 10 months.

  1. Fascinating. I myself thought of opening a checking account in the US the next time I would be over there. I naively thought a valid passport and some cash deposit would suffice. Looks like the US banking system outperforms the European one in bureaucracy.

  2. LOL hahahahaha oh my gosh this posting made my day. So funny to read. I have been in the US for 5 years but still remember the exact details as you decsribe :))

    Patrick – I actually did open a bank account with my passport and some $. But they only allow for a debit card (which you can use as a credit card, but does not build up credit score…)….

  3. We arrived in the USA this August and have been through exactly that rigrmarole. We also found that it was relatively easy to rent a house, but impossible to get utilities connected because we have no credit rating. Oh and by the way; one way of building a credit rating is to pay utility bills promptly!

  4. Ach, I hate utility bills. I had to PAY Time Warner $50 to install cable to my house so that I could pay them far too much every month. They wouldn’t come without the $50 because at the time I had no credit rating.

    Actually I’ve been meaning to update this page for a while. My super-rating of 729 was a very temporary blip it seems. With a fortnight of writing this post it nosedived to 669. And now it stands at 629.

    Not that it makes any different with the economy in the current state it is in. but it is worth noting that this credit score thing takes even longer than I thought.

    I think part of the problem may be that as soon as I got a credit score, I got a normal, unsecured credit card from my bank, cancelled the secured card and got my money back. Until I have at least three months of payments on my new card, it seems that I am in credit limbo.

    Stupid system.


Comments are closed.