Getting a US credit card as an expat
January 14, 2012 4:05 AM   Subscribe

How can an American expat get a credit card that isn't from a big bank?

We recently moved our money away from Bank of America. We had a credit card with them, which we cancelled. We would like to get another American credit card, because of the conveniences (coverage for rental cars, high limit that is useful for traveling) - but we are expats currently living in the Netherlands.

We have a USAA account, but we can't get a credit card through them that has anything less than a 15% APR because we aren't full members. We have excellent credit. Where can we get an American credit card with a non-crazy APR even though we live overseas?

*Credit unions are great, but I can't find an easy way of figuring out which credit unions we are eligible for (and some credit unions have credit cards that are administered by BoA anyway!).
posted by Philosopher Dirtbike to Work & Money (9 answers total) 1 user marked this as a favorite
Sorry, this doesn't directly answer you question, but: have you checked Dutch credit cards? Despite being a new customer, I was given a much higher limit in Germany than I get back home (the UK) precisely because continental European lending practices are so conservative. European banks usually offer accounts/cards designed for travellers (including travel and rental insurance, fee-free currency exchange, etc.), presumably because international travel is more common for Europeans. If APR is coming into your decision on par with considerations about rental insurance and credit limit then you may be doing it wrong. If you need to borrow money then consider a loan.
posted by caek at 4:43 AM on January 14, 2012

Where can we get an American credit card with a non-crazy APR even though we live overseas?

15% isn't a crazy APR. That's actually pretty decent. There are plenty of cards with 20%, 25%, even 30% APRs.

Remember, we're talking about unsecured consumer credit. There's no collateral the card issuer can repossess, and they're pretty sure you aren't using this card as an investment on which you hope to make money. You're using it either for stuff you can't afford right now, or as a matter of convenience so you don't have to carry cash.

If you're doing the former, damn straight they're going to charge you a lot of interest. That's an incredibly risky business. But if it's the latter, then they don't usually charge you interest at all. Just pay your bill off every month and, just like that, you're paying 0% interest. Problem solved.
posted by valkyryn at 5:03 AM on January 14, 2012 [3 favorites]

Don't run a balance -- pay your bill in full each month when you get it -- and APR is meaningless. Once that's out of the picture the USAA offerings should look pretty good. I hang out on the finance forums on fatwallet and from what I've read there, there's not too many credit union offerings that are great for international usage (in terms of no foreign transaction fee). Lots of people there like Penfed credit cards, but that's primarily for 5% cashback on gas. Membership in that union can be swung if you spend $20 to join some support organization.
posted by reptile at 5:04 AM on January 14, 2012

Sorry, this doesn't directly answer you question, but: have you checked Dutch credit cards?

I have a Dutch credit card.

Just pay your bill off every month and, just like that, you're paying 0% interest.

Yes, and this is the way things have always worked for us. However, if somehow things go badly for a few months, or I have to put international moving expenses on it before I get reimbursed for them, I don't want to end up paying hefty (read: usury) rates. I am a low risk customer. I had a lower APR with Bank of America, so I know it is possible.
posted by Philosopher Dirtbike at 5:45 AM on January 14, 2012

I am a low risk customer.

If someone has a lead for you on this thread then great, but this is not true. You have weak/non-existent relationships with these banks and you live in a different hemisphere. Can you re-open the BoA account and pick up with the APR you used to have?

You say 15% is usurious, but try to keep things in perspective. A cheaper credit card is obviously a good thing, but if your moving expenses are $10,000, and you get reimbursed 6 months late then the difference between the 15% USAA APR and a 7% APR is about $300. Life is short.
posted by caek at 6:02 AM on January 14, 2012

the difference between the 15% USAA APR and a 7% APR is about $300.

This is moot, since I just tried to apply to see the details and it won't let me due to my non-full membership status.

Lots of people there like Penfed credit cards

Thanks, I looked at PenFed just now, and some of their products do have lower APRs than USAA. Their membership funding (initial deposit) form does not allow foreign zip codes, even though their membership application does. Although I've asked for help through their online form, this does not bode well.
posted by Philosopher Dirtbike at 6:18 AM on January 14, 2012

Absolutely, yes, if you manage your balance properly, APR has very little impact. Even if you leave a balance on your card, the average daily balance may mean the interest payment may be lower than if you took the closing balance at the time of the statement. I have a $300 credit card which I use regularly, APR of 20% (which is $5 on $300 per month), and I don't think I've paid more than $3 or $4 on any statements, and most months the interest is 0. Spread that out over the past year of pretty regular use, and my actual in-practice interest rate is probably under 5%.

Also, 15% for a credit card is not a crazy interest rate at all in the US. Revolving and unsecured credit accounts are very expensive all over the US. Be aware that, if you're seeing lower APRs, those are likely to be introductory rates, and/or a teaser that only applies to the cream-of-the-crop customers and isn't actually available to average banking customers. That's probably the wall that you keep running into; the banks are reserving the special rates for a very limited pool of customers, which you don't belong to.
posted by AzraelBrown at 7:28 AM on January 14, 2012

If you would like an American credit card, my experience says you are going to have to apply with an American address, regardless of where you are physically located in the world right now. (I use my parents' address.) This approach will broaden your comparison shopping, perhaps to something like Iberia Bank.
posted by DarlingBri at 9:33 AM on January 14, 2012

I belong to a credit union (Wescom) that can be joined by anyone who lives in the state of California. I know there are a few others with similarly broad, geographic membership requirements - especially up in the San Francisco Bay area. I assume there are others in other states as well.

If you have a friend or relative in the states who will let you use their mailing address, you should look into the credit union options they have available to them. You can do all of your banking online. You'll find that the credit card rates tend to be a little lower at credit unions, and the terms and fees tend to be significantly better.
posted by Anoplura at 9:39 AM on January 14, 2012

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