The 3 best credit cards for expats in the US

Moving to the US to work or to look for work? You might want to get one of these 3 credit cards to manage your purchases and build your credit.

Xe Consumer North America

2021年6月14日9 min read

Young couple in Los Angeles, California in the United States using a credit card

The benefits of having your own credit card are clear. A credit card can help you to easily track expenses and manage your monthly cash flow. It offers a line of credit you can use to make purchases and balance transfers and cash advances. Some credit cards have reward programs and reward users for every dollar they spend.

Getting a new credit card may be necessary when you move to the US, but it can be trickier to get a credit card when you’re new to the country. Most companies give credit cards to permanent US residents or people with a Social Security number (SSN), but there are a few that issue credit cards to non-citizens.

There’s no one-size-fits-all credit card, so it’s important to choose wisely. This post covers the best credit cards for expats in the US, and how to go about getting one.

What to know about getting a credit card in the US

You don't have to be a US citizen to get a credit card. However, you do need to meet the minimum financial requirements, which will differ based on which card you apply for. Many credit card applications are straightforward, and typically take approximately 3-4 weeks to get approved.

It can be challenging to get a credit card as an expat because you have no credit history in the US. But the good news is some card issuers —like American Express—allow expats from selected countries to use their international credit history.

It’s worth mentioning that credit cards with lenient application requirements usually have higher interest rates and fees. However, they can help you build your credit history, which will allow you to switch to a different card later on.

What you need to apply for a credit card

The first thing you should do before applying for a credit card is to find the best one for your needs. During the application process, you’ll need to provide your:

  • Name

  • Date of birth

  • Gross annual income

  • Social Security number

  • Monthly housing payment.

This information helps the card issuer to determine your disposable income, and as a result, your credit limit. To get a credit card as an expat in the US, you need to:

  • Have a stable source of income. Most card issuers will ask about your estimated monthly income to verify your ability to repay and to determine the credit card limit.

  • Be at least 21 years old. If you're 18 years, you can only get a credit card if you have a verifiable source of income or your parents’ permission.

  • Have a Social Security number. It’s almost impossible to get a credit card without a Social Security number (SSN). If you don't qualify for a Social Security number, you can apply for an ITIN (Individual Taxpayer Identification Number) and use it instead. An ITIN is issued by the IRS to people who don't qualify for an SSN but need to file US federal income tax returns.

  • Have a good credit history. A good credit history can help you get approved for an unsecured credit card.

Types of credit cards

There are many credit cards available to expats in the US, all with different fees and functionalities. However, they all fall into these three categories.

Prepaid credit card

This may be your best option. You can get a prepaid credit card without a bank account, credit history, or a minimum deposit. You can even pay in cash if you buy the card in person.

A prepaid credit card is a low-risk credit card because you can’t overspend, miss payments, or accrue interest. You can easily track your money online and top up when money runs low—at a fee. Your balance never expires, and you only need to pay a set-up fee and load money to the card to get started.

The downside of prepaid credit cards is they don't build your credit history or affect your credit score.

Secured credit card

A secured credit card requires a security deposit. It helps you build a credit history and establish a positive credit score. Some banks let you invest the security deposit in financial products to maximize its interest.

To get a secured credit card, you'll need to deposit between $200 USD and $1,000 USD. Whatever amount you deposit remains in the bank account and becomes your monthly credit limit. If you make your payments on time, you can get a regular, unsecured credit card after a year.

Unsecured credit cards

An unsecured credit card doesn’t require a security deposit, but you must have a good credit history to apply for it, whether you’re a US citizen or not. It provides more benefits and impresses both landlords and lenders.

If you’ve gotten a job transfer to the US, find out whether the company has a relationship with US financial institutions that give international employees credit cards. This may help you get an unsecured credit card.  

How does credit function in the US?

There are 3 primary credit reporting agencies in the US: Experian, Equifax, and TransUnion. These credit bureaus sell credit information to lending institutions or individuals for a fee. They partner with many creditors and lending institutions to enhance their lending decisions—by helping them determine the creditworthiness of individuals.

The agencies issue credit reports which give a detailed breakdown of people’s credit history. A credit report provides personal information, employment history, and lists the bank accounts and credit card accounts in good standing or overdue. It also gives account information like balances and limits.

But what most lenders look at in a credit report is the overall credit score because it shows an individual’s creditworthiness. FICO scores are the most popular credit scores and are used in over 90% of lending decisions. Credit reports can display negative information for up to seven years.

Lenders may deny less creditworthy borrowers loans, or charge them a higher interest rate to make up for the additional risk. Creditworthy borrowers are charged a lower interest rate because they are less risky.

The most common way to build credit in the US is by getting a line of credit, like a credit card. Once you get the card, make payments on time, maintain a low credit utilization rate (below 30%), and keep your account open. You can also build credit by applying for a small loan and paying it on time.

Never borrow more than you can repay and check your credit score regularly. You can get a free copy of your credit report once a year thanks to the Fair Credit Reporting Act, but you must request it.

What are the best credit cards for people new to the US?

Choosing a credit card isn't easy, especially when you're new in the country. But it doesn’t have to be hard. Just get one of the 3 credit cards loved by expats. Let’s have a look at each.

Chase Sapphire Preferred® card

To qualify for the Chase Sapphire Preferred® Card, you need a credit score between 700 (Good) and 850 (Excellent). According to Forbes, this is the best entry-level travel card. It comes with 80,000 bonus points, but you need to pay a $95 annual fee to maintain it. The card’s regular APR lies between 15.99% and 22.99%.

This card would be a good fit if you travel or eat out a lot. You’ll earn double points on international travel and dining. All other purchases earn you 1 point per dollar. There’s no foreign transaction fee on this card, and you’ll enjoy premium travel and shopping protection.

Bank of America® Travel Rewards

This is one of the best credit cards for an expat. To qualify for the card, your credit score must be between 700-850. The card is packed with benefits. It comes with a welcome bonus of 25,000 points and doesn’t have a foreign transaction fee. You don’t pay any annual fee and earn 1.5 points for every dollar you spend.

Your points have no expiration date, and the card has a variable APR of 13.99% to 23.99% on balance transfers and purchases. You get an intro 0% APR offer for your first 12 billing cycles for purchases.

If you invest with Merrill or bank with Bank of America, you’ll get a rewards' accelerator. However, this card has a high balance transfer fee, a high penalty APR, and a late payment fee.

Discover it® Secured Credit Card

The Discover it® Secured Credit Card is ideal for people who are new to the US or those seeking to rebuild their credit. It offers excellent cashback rewards and you can get an unsecured card after 8 months.

With “Cashback Match,” you double the cash you’ve earned at the end of the first year. Every three months, this secured card offers a 2% cash back on purchases at Gas Stations and Restaurants—for up to $1,000 in combined purchases. All other purchases automatically earn you 1% cash back.

The secured credit card has a 22.99% variable APR and no annual fee. It also has a 10.99% intro APR on balance transfers (for 6 months). And the best part is you only need a minimum security deposit of $200 to get started.

Anything else?

There are many credit card issuers in the US. However, it’s best to stick to the major providers. If you opt for a smaller card provider, you may not be able to use the card everywhere. Also, be sure to monitor transaction fees keenly as they can add up quickly.

Depending on the card that you choose, making a purchase in another country or currency could get very costly between the foreign transaction fees and the exchange rate (for example, see our article on the Mastercard exchange rate).

If you need to send money overseas, we encourage you to instead try using an Xe money transfer. You can send money to over 130 countries entirely online, and you can utilize your new credit card to provide the funds for the transfer. Go ahead, get a quote now—there’s no obligation to send.

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