How can I build credit as an international student?

As an international student, it may be useful to think about building credit while attending college in the U.S. Building a credit history of on-time payments is a necessity for living in the U.S., including securing housing and utility services. Most of the transactions that happen in daily life are paid by credit or debit cards instead of cash. A good credit history can benefit you through lower interest rates on personal or mortgage loans and even lower security deposits when you rent an apartment. Here are some steps you can go through to start building your credit history.

Step 1: Find an on-campus job to get a SSN

SSN stands for Social Security Number. It’s a national identification number for taxation and other purposes issued by the Social Security Administration. As an international student, you probably would not allowed to work off-campus due to the F1 visa status. However, you can find an on-campus job and work 20 hours or less on a weekly basis.

Step 2: Apply for credit cards

It may not be easy at the beginning to get a card that fit your needs. Credit cards have different perks or advantages. For example, some feature balance transfers, low interest rates, rewards/cash back, or airline points.

You can always apply for secured credit cards even if you don’t have a SSN. These cards are backed with a deposit account as collateral. The deposit is likely to be 100% to 200% of the amount of the credit you want to get. However, keep in mind, different banks have different policies on credit card issuance and not all banks offer secured credit card. Therefore, do your research before applying for any credit cards or ask a banker in your local banks for any available offers.

Step 3: Manage your credit history

Use your credit wisely and make sure to pay off the balance on time. The University of Illinois Extension has great resources on how to manage your credit history on its website. These materials will give you a better understanding of credit history and how to manage it wisely. Peer educators with the Financial Wellness for College Students program also have office hours, and you are more than welcome to make an appointment with a peer educator to discuss credit cards.

Written by: Zige He, Financial Wellness Peer Educator, and Kathy Sweedler, Consumer Economics Educator, University of Illinois Extension