America

How to Build Your Credit in America

Welcome to America, the home of “credit”. In my opinion, if cash is king then credit is an emperor in  America. Having physical cash can get you so far but having credit opens many opportunities to you.  Here is a simple  experiment, go to any of the hotels in your area to book a room, ask to pay in cash and see what happens. More often than not, they would want to have a credit card for the transaction. So as a new immigrant, you will have to learn to understand and embrace this culture of credit in America.

What is Credit? Who maintains the credit report and calculates the score?

  • Ability to have access to goods and services with the understanding that you will pay later. It may be a credit card or access to loans. There are 3 credit reporting bureaus : Equifax, Experian and TransUnion, they are non-governmental agencies responsible for maintaining credit report and calculating the credit score of all Americans.

What is a credit score?

  • It is the measure of your “credit worthiness”. It basically determines whether you are a high risk or low risk borrower.  A good credit score means you are a low risk borrower but poor credit score means you are a high risk borrower.
Image from Experian.com

 

Why is it important?

  • Loans
    • Your ability to secure loans such as  auto loan, personal loan, mortgage loan are determined by your credit worthiness.  A poor credit may disqualify you from getting approved for certain loans.
  • Interest Rates!
    • Having a good credit can offer you benefits such as low interest rates but a poor credit could put you at risk of high interest rates if you do get approved for a loan or  a credit card. Example: Person A goes to an auto dealership to buy a 2022 VW Atlas but your credit score is 720, which is good so you get approved for an auto loan with 9% interest rate for 48 months. However, Person B  with 810 credit score get the same car at an interest rate of 3% for 48 months.

Person A ends up paying $ 2,415.48 in interest

                 Person B ends up paying  $797.17 in interest

                Person B saves $1,618.31..That’s the impact of credit!

  • Some jobs may require it as a condition of employment.
    • Having a good credit is necessary for some jobs such as military, law enforcement, prison jobs, attorneys etc. Imagine the horror if criminals could influence our law enforcement officials with money. Our justice system is not for sale so to maintain the integrity of our judicial system, all the people connected to it are expected to be held to a standard where they can’t be influenced by money.

How to you build a credit as a new immigrant?

You can start with cellphone account

  • most cellphone plans do not require you to have a credit history or score, so this will be a good starting point.

Open a bank account where your paycheck gets deposited

  • Most banks offer their customers credit cards  after you have been with them time, you bank will offer credit cards to you

You can use credit builder loan accounts to help you build your credit.

  • A Credit builder loan account allows you to make monthly payments to be held by the bank or service provider and at maturity, you will get the money you paid back minus administrative fees. These monthly payments will be reported to the credit bureaus and missed payments will also be reported to the credit bureaus as well.

Pay rent

  • Some apartments report rent payments and missed payments to the credit bureaus. Making your rent payments on time and consistently could help boost your credit score

 

How do you lose or gain points?

  • Payment history
    • Making on time payment of bills and not missing a payment goes a long way to increase your credit score points. Doing the otherwise will cause you to lose point resulting in decreased score.
  • Credit Utilization
    • It is a percentage of how much credit you have used versus the total credit line. Having a higher credit utilization will have negative impact on your credit score and vice versa. The goal is to maintain a low credit utilization percentage so that you can gain points.

Example; if you have $1500 credit limit, keep the rolling balance under 20%. This will show other lenders that you have your spending under control and they can trust you with even more.

  • Length of credit history
    • It is the amount of time you have held that credit account for. This may go against  a new immigrant since you are starting from scratch. But one way to overcome this, is to be an authorized user on an older account of someone who has a good credit score. This will help boost your credit history. Similarly, a negative activity by that user could impact the authorized user. Been an authorized user does not necessarily mean you should be given a credit card on that account.
  • Credit mix
    • Having varied credit accounts such as credit cards, loans, etc., help boost your credit score.
  • Recent application
    • Every time you apply for a new credit card or loans, the lender performs a “Hard pull” on your credit report. This hard pull could result in loss of 5 points or more on your credit score. So, it is a good idea to not have as many hard pulls and avoid unnecessary credit applications that may result in hard pull. A hard pull may stay on your credit report for 2 years.
  • Derogatory information
    • This may be the result of having multiple nonpayment or an account going into collection. An account goes into collection when the original creditor/lender has been unsuccessful in collecting payment on a bill. And so, the lender sells the account to a collections agency which will attempt to collect the payment. Try and negotiate with the original creditor/lender to come to a flexible payment plan before your debt goes into collections. A collections action against any of your accounts could impact your credit for 7 years.

How do you check your score?

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How to Properly Name Your Supporting Documents for Diversity Visa Lottery DS-260

If we have learned anything about U.S. Immigration, not following instructions could lead to a disappointing outcome such as rejection of your documents, which will further delay processing of your case.

Document should be one of the following list if applicable: Passport_Biohraphic_data, Birth_Certificate, Marriage_certificate, Divorce_document, Death_certificate, Annulment_paper, Military_record, Police_certificate_country_XXX, Court_record_country_XXX.
If translations are needed, then add “_translation” on the filename. Translate documents that are not in English
Proper Document naming;

Unmarried Applicant:
• 2022AF00888888_Jacob_Ade_Passport_Biographic_data.pdf
• 2022AF00888888_Jacob_Ade_Birth_Certificate.pdf
• 2022AF00888888_Jacob_Ade_police_certificate_country_france.pdf
• 2022AF00888888_Jacob_Ade_police_certificate_country_france_translation.pdf

If applicant is married;
Principal applicant
• 2022AF00888888_Jacob_Ade_Birth_Certificate.pdf
• 2022AF00888888_Jacob_Ade_Passport_Biographic_data.pdf
• 2022AF00888888_Jacob_Ade_police_certificate_country_france.pdf
• 2022AF00888888_Jacob_Ade_police_certificate_country_france_translation.pdf
• 2022AF00888888_Jacob_Ade_marriage_certificate.pdf
Spouse
• 2022AF00888888_Ruth_Ade_Birth_Certificate.pdf
• 2022AF00888888_Ruth_Ade_Passport_Biographic_data.pdf
• 2022AF00888888_Ruth_Ade_Police_Certificate.pdf

If applicant has children;
Child #1
• 2022AF00888888_Kofi_Ade_Birth_Certificate.pdf
• 2022AF00888888_Kofi_Ade_Passport_Biographic_data.pdf
• 2022AF00888888_Kofi_Ade_Police_Certificate.pdf (this depends on age, and if ever arrested. Please use Police Certificate criteria to determine)

Child #2
• 2022AF00888888_Joy_Ade_Birth_Certificate.pdf
• 2022AF00888888_Joy_Ade_Passport_Biographic_data.pdf
• 2022AF00888888_Joy_Ade_Police_Certificate.pdf (this depends on age, and if ever arrested. Please use Police Certificate criteria to determine)

Please use the document list to determine which documents you need to submit since this list is not exhaustive.

Follow the instructions and use common sense in all you do! Factcheck and doublecheck everything.
Thank you!

How to Obtain Police Certificate from United Arab Emirates for Green Card Visa

Police Certificate in UAE
A Police Clearance Certificate (PCC), known also as ‘Good Conduct Certificate’ is a proof of the person’s criminal record or the lack of it in the state in which he/she resides. In the UAE, the certificate is issued by police departments across the UAE and it indicates that the person is not accused or does not have any criminal precedents.     

Documents required:

  •  a valid emirates ID card
  •  a letter from the beneficiary stating that he/she does not have any pending criminal convictions
  •  a recent passport-size photograph
  •  a copy of the applicant’s passport.

If you are no longer a resident of the UAE, you need to get your fingerprint card from the country you are residing in and have it attested by the UAE Embassy there. A fingerprint card is an official report from the police department concerned, which verifies the identity of a person based on his biometrics and decimal fingerprint. Then, you can send your request for PCC online to Ministry of interior- UAE or to Dubai Police along with the following documents:

  • fingerprint card approved by the UAE Embassy
  • two recent passport-sized photographs
  • a copy of your valid passport
  • a copy of your last UAE visa
  • the reason for the application.

How to Apply
You can apply for the certificate online through the Ministry of Interior’s website and/or their smartphone app MOI UAE available on iTunes and Google Play.
You can also visit one of the MOI’s services centers and get the document done after filling the application form and paying applicable fees through the electronic payment cards. You also apply through Dubai Police’s website >>Dubai Police

Thank You!

Invitation Letter B1/B2 Visa for United States

Getting an invitation letter to come to America is a way to answer the question about the purpose of your visit. Unfortunately, putting the thought together to type an invitation letter is a challenge for many. Therefore, I have put together a sample invitation letter that you can edit to suit your situation. This one suits an invitation to a friend.

[Date]                                                                                                 

[Sponsor’s name]

[Full address]

USA

Phone Numbers:

(Work): [(xxx) xxx-xxxx]

(Home): [(xxx) xxx-xxxx]

Email: [email address]           

To:

[Visitor’s name]

[Visitor’s Address]

Dear [Visitors],

I invite you to visit me in the USA. My vacation is coming up soon and I have plan to visit famous tourist places like [name of tourist places to visit] and I am sure you would enjoy this excursion. It will also be an opportunity for you to see and experience the American culture and lifestyle and catch up with each other.

I will be taking care of your entire USA tour expenses, including the round-trip air fare food, housing, medical insurance and all your other personal expenses. It has been quite some time since we saw each other and I am looking forward to this reunion.

Herewith I’m sending all the required documents for getting the necessary tourist visa from the US Consulate, [Name of US Consulate, e.g., Nairobi Consulate]

Please let me know, if there’s any additional document that I need to submit.

Sincerely,

[Sponsor’s signature]

[Sponsor’s name]

If you are unsure about the process and want to learn more, please checkout my video on What should be in your invitation letter

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