US VS UK Credit
July 1, 2011 10:25 PM Subscribe
I am a US citizen who has lived in the UK for the past 7.5 years. I'm thinking of returning, but I wonder what credit implications will be.
I have good credit in the UK, but I had awful credit in the US. Do the agencies talk across the pond? I guess the best case scenario would be that the UK agencies gave the US ones a big thumbs-up on my behalf. I've tried to check, but the US agencies won't event talk to me, since I don't have a current US address.
I have good credit in the UK, but I had awful credit in the US. Do the agencies talk across the pond? I guess the best case scenario would be that the UK agencies gave the US ones a big thumbs-up on my behalf. I've tried to check, but the US agencies won't event talk to me, since I don't have a current US address.
I was in a similar position a few years ago: I moved back to the US after 16 consecutive years in Italy, and I started over from scratch. After 7 years, the black marks on your credit record should be gone (although you should get copies of your reports from all three major agencies to make sure--you get one free one a year).
Starting from zero was difficult in some ways; I couldn't get a credit card, and was originally asked to put down a ridiculous deposit on my first cell phone contract due to a lack of record (but the guy at the shop ended up waiving that requirement, thankfully). It took a few months of paying my bills regularly and using my debit card for online shopping to build up my credit again. It's not that big a deal, though--getting the blank slate can be easier than rebuilding a bad record.
posted by Superplin at 11:54 PM on July 1, 2011
Starting from zero was difficult in some ways; I couldn't get a credit card, and was originally asked to put down a ridiculous deposit on my first cell phone contract due to a lack of record (but the guy at the shop ended up waiving that requirement, thankfully). It took a few months of paying my bills regularly and using my debit card for online shopping to build up my credit again. It's not that big a deal, though--getting the blank slate can be easier than rebuilding a bad record.
posted by Superplin at 11:54 PM on July 1, 2011
According to this website, which agrees with what I've read and heard other people say, it's not as simple as waiting 7 years for bad information to fall off your credit report:
The length of time a negative mark can stay on your credit report starts from the time you were late or the late payment went into collection, not from the last time you made a payment on the account. Some collection agencies update their reporting status on you to keep the account active with the bureaus to extend the time the account appears on your report. Very crafty and underhanded of them, because most often the account is updated and the period of time the account is active appears to be extended. This is illegal! Challenge this! If you do, bureaus will correctly remove it 7 years from origination. Period. In other words, paying a collection will not keep it on your credit report for a longer period of time.
Supposing that no one has done anything illegal, it could have been sent to collections less than 7 years ago, in which case your credit history in the US might be even worse now than when you left.
Only way to find out is to request a copy of your report from the credit agencies.
posted by sbutler at 12:04 AM on July 2, 2011
The length of time a negative mark can stay on your credit report starts from the time you were late or the late payment went into collection, not from the last time you made a payment on the account. Some collection agencies update their reporting status on you to keep the account active with the bureaus to extend the time the account appears on your report. Very crafty and underhanded of them, because most often the account is updated and the period of time the account is active appears to be extended. This is illegal! Challenge this! If you do, bureaus will correctly remove it 7 years from origination. Period. In other words, paying a collection will not keep it on your credit report for a longer period of time.
Supposing that no one has done anything illegal, it could have been sent to collections less than 7 years ago, in which case your credit history in the US might be even worse now than when you left.
Only way to find out is to request a copy of your report from the credit agencies.
posted by sbutler at 12:04 AM on July 2, 2011
I do not know how this fact affects the general seven-year rule that is being cited here as to credit rating, but I do know that, in many states, the statute of limitations on claims for breach of contract (failure to pay a debt) is suspended while you are absent from the jurisdiction. That means that the creditors might still have legal recourse once you return.
posted by yclipse at 4:26 AM on July 2, 2011
posted by yclipse at 4:26 AM on July 2, 2011
My parents lived abroad for decade and had a couple of US credit cards. I imagine this helped them with credit when they moved back to retire. Not sure how they got the cards or whether it was contingent on them having a US bank account (they did)--or, indeed, whether or not you could do this your bad US credit--but it might be worth a shot.
posted by col_pogo at 7:25 AM on July 2, 2011
posted by col_pogo at 7:25 AM on July 2, 2011
sbutler's website is probably wrong. Unless the law has changed recently, date of last activity (meaning the last payment or charge you made) is what the creditor can legally use as the date when the clock starts ticking. That is, unless you later made a promise to pay the debt, which will also start the clock over. Not that collection agencies are above reaging debts to keep them on your report.
Do note that unlike unpaid credit accounts, the record of a bankruptcy will stay on your report for 10 years, not 7.
In the best case, you'll have no credit whatsoever. This means that you'll probably want to have an extra $500 or $1000 to use for a secured credit card. In six months or so, you can probably get an unsecured card from one of the known easier lenders. Six months or so after that, so long as you keep your nose clean and your cards under 33% utilization, you should be in a position to get cards from the prime issuers with relatively small credit lines, or buy a car on reasonable terms, or whatever else you want.
Debit cards do not get reported to CRAs, so give you absolutely no help in rebuilding credit, same with utilities and cell phones. That stuff only gets reported if you stiff them. Basically, the only things that get regularly reported are loans, whether it be credit cards, car loans, home loans, or personal lines of credit. Even on auto loans and the like, I've dealt with local banks that don't report unless you specifically request them to do so.
The best advice I can give, however, is to visit creditboards.com. It's mainly geared toward the bad credit crowd, but the same advice applies to starting from scratch as it would to rebuilding after getting all the negative accounts removed from your file, so there's plenty there for you even though you're starting from scratch and don't (or shouldn't) have a bunch of crap to get removed from your report. It's also a great resource if it turns out you need to contest some reaged accounts.
Even if you left the jurisdiction, the Fair Credit Reporting Act still applies to what can go on your report. A former creditor might be able to sue you, depending on your specific circumstances, but that doesn't mean they can put the account on your credit report.
posted by wierdo at 4:49 PM on July 2, 2011 [1 favorite]
Do note that unlike unpaid credit accounts, the record of a bankruptcy will stay on your report for 10 years, not 7.
In the best case, you'll have no credit whatsoever. This means that you'll probably want to have an extra $500 or $1000 to use for a secured credit card. In six months or so, you can probably get an unsecured card from one of the known easier lenders. Six months or so after that, so long as you keep your nose clean and your cards under 33% utilization, you should be in a position to get cards from the prime issuers with relatively small credit lines, or buy a car on reasonable terms, or whatever else you want.
Debit cards do not get reported to CRAs, so give you absolutely no help in rebuilding credit, same with utilities and cell phones. That stuff only gets reported if you stiff them. Basically, the only things that get regularly reported are loans, whether it be credit cards, car loans, home loans, or personal lines of credit. Even on auto loans and the like, I've dealt with local banks that don't report unless you specifically request them to do so.
The best advice I can give, however, is to visit creditboards.com. It's mainly geared toward the bad credit crowd, but the same advice applies to starting from scratch as it would to rebuilding after getting all the negative accounts removed from your file, so there's plenty there for you even though you're starting from scratch and don't (or shouldn't) have a bunch of crap to get removed from your report. It's also a great resource if it turns out you need to contest some reaged accounts.
Even if you left the jurisdiction, the Fair Credit Reporting Act still applies to what can go on your report. A former creditor might be able to sue you, depending on your specific circumstances, but that doesn't mean they can put the account on your credit report.
posted by wierdo at 4:49 PM on July 2, 2011 [1 favorite]
This thread is closed to new comments.
posted by crazycanuck at 11:05 PM on July 1, 2011