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You’ve done everything you need to do in order to apply to university in the States. You finished writing your personal statement, statement of purpose or MBA essay and you’ve already taken your GRE test, GMAT (if you've applied for a business school), TOEFL or IELTS. You’ve sent the recommendation letter that your professor wrote you and now you’re only waiting for Harvard, Yale, Princeton, Columbia university or MIT to let you know that you’ve been accepted for the next study year. So you think that the hard part of moving to the US is over?
As you may know, there are a few things about studying in the United states that are different to studying abroad in other places. So before you jump on the first flight to New York, Florida, Texas, Pennsylvania or Alaska, to pursue the American dream, there are a few things you need to know. If you’ve already started the search to find an apartment, get a job or buy a car in the States, you might have encountered some problems. Getting a car loan to buy a car, for example, will be determined by your credit score. Don’t know what that is? Well, read on and find out.
In the U.S., your creditworthiness (meaning how likely you are to pay your debts), is represented by a number – that is your credit score.
It starts building only as soon as you enter the country, disregarding any financial history you may have abroad. When you apply for a loan, a mortgage or a credit card, prospective lenders, such as banks, will use this number to assess the risk in extending you credit.
Your credit score provides an overview of how you are maintaining and managing your credit. A good credit score is a must for anyone looking to get a credit card, a car loan, or even renting an apartment.
The higher the number – the better. Your credit score plays a crucial role in determining whether or not you’ll be eligible for a loan, and at what interest rate.
Your credit score, which ranges between 300 and 850, is calculated based on 5 main factors:
1. The most significant factor is your payment history – late payments will drop your score.
2. The amount you currently owe lenders. Owing money doesn’t necessarily hurt your credit score, but using most of your credit might.
3. Your credit history, meaning how long you have been using credit. Well-established accounts will have a positive effect.
4. Also influential are the types of credit accounts you maintain, such as credit cards or installment loans.
5. Finally, new accounts and recent inquiries from creditors might hurt your score, especially if done several times in a short period of time.
The problem is, that building a good credit score in the US may take several months or even years. There are other solutions for international students who want to get a loan to buy a new or a used car. For example, platforms like Lendbuzz allow students and young professionals in the US to apply for a loan, and get it according to their educational background, employment history and their potential future income.
So if you’re moving to the States, and you’d like to navigate around the US, or buy a car to commute to work, worry about your credit score but don't let it limit your possibilities and freedom. There are still alternative ways for you to get a car loan and start to travel and get around.
Lendbuzz is an online platform providing car financing for international students and professionals in the U.S. which offers attractive car financing solutions – for individuals without U.S. credit history.
We hope this was helpful.
For more information, please write us: firstname.lastname@example.org.