[hhuberla]

At last! a non-visa related question

I got my L1A petition approved yesterday so I'm off to a trip to my local neighbourhood embassy for what I hope will be a painless interview.

I have a question around getting started when I arrive. I am moving to Chicago in January (great time of year to go huh?) and I'll be getting a hire care for a month on my company. I will need to sort out something more permanent pretty quickly.

I'd like to buy a new (or almost new car) from a main dealer. I know it costs a bit more but for me it's worth the peace of mind.

How difficult is to to get any sort of credit as an almost newcomer to the US. I'll be able to put down a fair deal (25%) as a downpayment. Does this make things better? I guess I will get crucified on interest rate - any way to avoid this in my situation?

I've read on this forum that getting some credit (like a car loan) will stand me in good stead - is this true or over-rated?

If it helps I do own a home in the US (fully owned, not mortgaged).

Thanks
H

 

[Fatbrit]

The site CarBuyingTips is compulsory reading for anyone who has never experienced the wonders of a US car dealership. Look past the design (shades of the early days of the web!) and ignore the adverts....because the information is pure gold.
The best site for vehicle comparisons and prices is Edmunds

On the loan front, it'll be difficult. There used to be "first-time buyer" programs with a horrific interest rate that were readily available. But since the crash, I have no idea if these are still available. Anyway, a few ideas for you:
* Go for the loan applications all in the same week -- this minimizes the hit on your credit score. You get a ding every time someone hits your credit. But if the dings are all at the same time for the same type of loan, it all counts once against you in the Fico algorithm.
* Car loans generally have no pre-payment penalty. So you can always pay off early to avoid the high interest. Regardless, try to keep the loan for at least 6 months for maximum benefit to your credit score.
* Consider the alternative of a home equity loan against your property.
* Consider programs before you come to the US. International AutoSource are the most common ones I see mentioned -- with mixed reviews.
* Think, think and think again if anyone tries to push you towards leasing!

 

[hhuberla]

* Think, think and think again if anyone tries to push you towards leasing!

Any particular reason? I've leased in the UK with much success. I tend to replace cars every 2-3 years so it worked out well for me (particularly well when the used car market tanked in the recession).

Thanks for the advice - I'll read the guide!

H

 

[Fatbrit]

Any particular reason? I've leased in the UK with much success. I tend to replace cars every 2-3 years so it worked out well for me (particularly well when the used car market tanked in the recession).

The UK market bears no resemblance to the US one. It gives you both the best and the worst deals in the world. You have to work at it to get the best ones.

 

[liclgl]

credit

To be honest, your chances to receive credit in the current economic condition and Without a history is not very good. not to say, zero. I recommend not to waste too much time and effort about thet and organize someone (Businesses or private) to cover it for you. (Co-signing)

 

[hhuberla]

To be honest, your chances to receive credit in the current economic condition and Without a history is not very good. not to say, zero. I recommend not to waste too much time and effort about thet and organize someone (Businesses or private) to cover it for you. (Co-signing)

I guess that begs the question: How does one start a credit record if one can't get any credit. Chicken and egg situation.

 

[Fatbrit]

I guess that begs the question: How does one start a credit record if one can't get any credit. Chicken and egg situation.

Secured credit card is one easy way. Open one for $500 at BoA or similar. Spend between 50 and 100 bucks on it every month, and pay off bill in full every month. After 6 months of this game, you will have a fledgling credit score.

Other methods include "first time buyer" car loan or, in your case, home equity line against your property. It takes a good few years to build a decent amd robust credit score and you can't rush it.

 

[liclgl]

I guess that begs the question: How does one start a credit record if one can't get any credit. Chicken and egg situation.

Time...:confused2:

There are ways as previously mentioned here, but they all take time...

 

[hhuberla]

* Consider programs before you come to the US. International AutoSource are the most common ones I see mentioned -- with mixed reviews.

Thanks for the advice Fatbrit. I've looked into this company - they seem to only be able to arrange vehicle finance BEFORE you leave the UK. For me that's not suitable as I'd like to take a few months to make sure that my finances work out etc.

I've found another company since then which others may fine useful. Lion Leasing can provide leasing or finance from within the US but specialise in performing credit check in other countries.

A colleague of mine has made initial contact with them and they seemed frank and honest. I'll post info for others who may find it useful as I go through the process.

H

 

[EximCars]

I guess that begs the question: How does one start a credit record if one can't get any credit. Chicken and egg situation.

A co-signer will help, I was my sister's co-signer when she financed her first car. They used my credit score, she got the low rates and her credit score started building that way.

She also went for the low hanging fruits, the credit cards offered at The Gap, etc... She was able to get approved for $500 credit limits at first and just recently built enough of a credit score to finance a home.

 

[Fatbrit]

She also went for the low hanging fruits, the credit cards offered at The Gap, etc... She was able to get approved for $500 credit limits at first and just recently built enough of a credit score to finance a home.

One thing to point out here, though, is the danger of over applying for cards. Credit applications hurt you credit score! Don't go applying for everything all at once. No more than one application every six months would be a good guide. It takes time to build a credit history

 

[American Guy]

Given the current economic realities, getting a car loan in your situation will be next to impossible. You MIGHT be able to get some financing, but it will come with a horrific interest rate (think over 20%), although I doubt you'll even get that. The problem is that you want to buy a new (or almost new car) from a mainstream car dealer. That won't work. If you want a car, look to a "Cars and Credit" type of dealer - not a mainstream dealer, and certainly not a new car. Once you have a tax id number, you can probably get a car from a place like this. Once you successfully paid on the loan for some time (a couple of years), you'll have a credit record started. You can't do what you want in the immediate future, sorry.