You could be mistaken for believing life revolves around credit scores here in the States. In many ways it does, and I believe the present financial meltdown may never have happened if banks had paid more attention to credit scores when handing out subprime mortgages. But I'm getting ahead of myself.
Everyone in the US has what is known as a "credit history" reflected in a score from 0 (the worst) to 900 (perfect), though anything over about 700 is considered good. Your credit score is supposed to measure your creditworthiness. Whenever you buy something using a credit card (an American obsession, and one I am beginning to understand given the twin problems of VAT-less pricetags and universally green banknotes), it affects your credit score. Whenever you take out a loan or mortgage, it affects your credit score. More importantly, banks and other organisations check your credit score whenever you apply for a credit card or a loan/mortgage. Low score? I'm sorry!
Strangely enough though, if I've understood this correctly, your credit score increases when you take out a loan, and decreases every time someone merely checks your score and turns you down for credit because it's too low (a great vicious circle, if ever I saw one).
More importantly to New World newbies like myself, when you first come to the States you have no US credit history and therefore automatically start with a credit score of "0" even if you've been using credit cards - including the US-owned Visa or American Express brands - for decades. This means that you are considered non-creditworthy, and can kiss goodbye to the idea of applying for a credit card or even leasing a car until you've built up credit history and a good credit score, which usually takes several years.
But here's the rub: how are you supposed to build up a credit score if you can't do any of the things - use credit cards, buy houses, lease cars, etc. - that increase your score? Now I know where Joseph Heller, the son of Russian immigrants, got the idea for his book Catch-22.
Everyone in the US has what is known as a "credit history" reflected in a score from 0 (the worst) to 900 (perfect), though anything over about 700 is considered good. Your credit score is supposed to measure your creditworthiness. Whenever you buy something using a credit card (an American obsession, and one I am beginning to understand given the twin problems of VAT-less pricetags and universally green banknotes), it affects your credit score. Whenever you take out a loan or mortgage, it affects your credit score. More importantly, banks and other organisations check your credit score whenever you apply for a credit card or a loan/mortgage. Low score? I'm sorry!
Strangely enough though, if I've understood this correctly, your credit score increases when you take out a loan, and decreases every time someone merely checks your score and turns you down for credit because it's too low (a great vicious circle, if ever I saw one).
More importantly to New World newbies like myself, when you first come to the States you have no US credit history and therefore automatically start with a credit score of "0" even if you've been using credit cards - including the US-owned Visa or American Express brands - for decades. This means that you are considered non-creditworthy, and can kiss goodbye to the idea of applying for a credit card or even leasing a car until you've built up credit history and a good credit score, which usually takes several years.
But here's the rub: how are you supposed to build up a credit score if you can't do any of the things - use credit cards, buy houses, lease cars, etc. - that increase your score? Now I know where Joseph Heller, the son of Russian immigrants, got the idea for his book Catch-22.
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