Reader Question: International Credit Relations

One of the best things about the internet is how it allows informal conversations between people who live around the world. Today's credit question comes from Gerald in New Zealand:

I am an American citizen living the past 9 years in New Zealand. I will be working in USA from the end of May through the end of September 2007. I would like to assume a car lease for that time. BUT am having trouble getting proper credit approval.

I do not have a current address or telephone number in USA but have employment contract now and will physically be there on the 17th of May. I have an American bank account and just this week obtained a VISA credit card (albeit the limit is a measly US$300).

I have two New Zealand bank credit cards (VISA, MasterCard) all in good standing.  I and my wife own our own home registered valuation of NZ$600,00.  We own property in New Zealand without a mortgage worth NZ$160,000.We own two cars. No outstanding loans.

One of my sons, (living in USA with excellent credit history) has agreed to be a co-creditor.  PLEASE advise me on how can I get a good credit rating?

Gerald is lucky to have several options at hand for getting the car he'll need this summer. Because he is a US citizen, he doesn't have to worry about setting up a taxpayer ID number. And Gerald has already done a few smart things to get started.

Opening a visa credit card, using it for one small purchase each month (around $30) and paying the bill on time will go a really long way to helping establish his credit in the US. By the time he gets here next month, it is possible that Gerald might actually have enough of a credit history to get a car lease on his own. He should check his credit reports to see if the account is being reported accurately.

If Gerald's credit is not good enough to qualify for a loan in May, he will have several options. Asking his son to co-sign the loan can be a good idea. However, Gerald should keep in mind that the shared loan will appear on both their credit reports and will be both their legal responsibility if something goes wrong. Aside from co-signing, Gerald could also use a cash down payment to get approved or could buy a used car with cash to later resell.

Gerald will probably have the best luck finding financing through a dealership instead of a bank or online auto lender.  Dealers are usually the best resource for tricky credit. If that doesn't work, he can try a local credit union. They may be able to use some of his credit history in New Zealand for a manual underwriting.

If you are working on establishing your credit, from New Zealand or not, Credit.com has a great article with expert tips to help you get started. Next question?  Send your credit and money questions to tidbits@credit.com.