Moving to the US can be overwhelming, as you’ve most likely spent months or even years navigating visa applications and packing up your life. Whereas, at most times, the confusing hurdles appear after you arrive. You apply for a loan or go into a car dealership, and you’re not eligible because your financial profile is nonexistent. You may have had perfect credit in your home country, but it didn’t transfer to the United States. While it doesn’t mean you’re bad with money, it just means that the U.S. financial system doesn’t have enough data to indicate your reliability. Without a personal credit score, landlords might deny your rent application, utility companies might require a high deposit, and getting a car loan may seem unrealistic. If you’re in a similar situation, there are plenty of options that you can utilize when looking at how immigrants can build credit in 2026.
Decoding the System: What Lenders Want to See
To win at any game, you have to know the rules. In the U.S., your financial reputation is boiled down to a three-digit number, typically a FICO® score. This score tells lenders how risky it is to lend you money.
You don't need to memorize every algorithm, but you should focus heavily on two specific factors: payment history and credit mix. According to FICO®, 35% of your credit score is based on payment history, and 10% is based on credit mix.¹
- Payment History: This answers the question, "Do you pay your bills on time?" It is the single most influential factor.
- Credit Mix: It’s essential to mix your credit profile with different accounts. Accounts like a revolving account and/or an installment account are just a couple of accounts that you can utilize.
This core system is essential for immigrants who are starting out. It’s important to open accounts that report to the three bureaus and to never miss a payment.
Step 1: Establishing your Personal Credit Score
Before applying for credit, you need to make sure that lenders have access to your financial history. The primary tracking number for all US residents is the Social Security Number (SSN). If you’re immigrating from overseas on a visa, you likely already have one- or are eligible to apply.
However, not everyone qualifies for an SSN immediately. If this applies to you, you should apply for an Individual Taxpayer Identification Number (ITIN). This is a tax processing number issued by the IRS. While not exactly an SSN, the major credit bureaus and many financial institutions still accept it. You should be able to open bank accounts and apply for certain credit cards using an ITIN, allowing you to start building your credit history without an SSN.
If you are navigating the complexities of banking for the first time here, the Consumer Financial Protection Bureau offers excellent resources and newcomers' guides to managing money that can help clarify the documentation you need.
Step 2: The "Authorized User" Shortcut
A major shortcut to utilize, if applicable, is to use someone else’s good credit history. Having a trusted family member or close friend in the US who has a credit card with a long history of on-time payments can co-sign or be an “authorized user” on your loan/credit card.
Here is how it works:
- They add your name to their account.
- You get a card with your name on it (though you don't actually have to use it).
- The credit card issuer reports the account's history to your credit file.
Suddenly, their five years of perfect payments might appear on your report, giving you an instant boost. However, this comes with a warning: make sure the primary account holder is responsible. If they miss a payment or max out their card, that negative information could hurt your score, too.
Step 3: Open a Secured Credit Card
For many, having someone to add as an authorized user may not be feasible. If you want to build independence, a secured credit card is the standard starting point.
Traditional "unsecured" cards rely on your promise to pay them back. Since you don't have a history yet, banks view that promise as risky. A secured card eliminates that risk. You provide a cash deposit, usually around $200 to $500-which the bank holds. That deposit becomes your credit limit.
While you can use the secured credit card at your discretion, the importance here is to utilize it to show that you can responsibly manage your credit. Many secured credit card owners utilize this account for small purchases, like groceries or gas, and they pay the bill in full every month. Because the bank holds your deposit, they’re willing to work with you. Over time, many banks won’t require a deposit, and you’re eligible to upgrade to a standard that returns your deposit.
For a deeper dive into managing these early accounts, reading up on how to start building credit will give you a clear roadmap of the do's and don'ts.
Step 4: Use an Installment Loan to the Mix
While credit cards are great for proving you can manage revolving debt, they only cover part of the picture. Remember that "credit mix" accounts for 10% of your score.¹ Lenders like to see that you can also handle an installment loan-a fixed payment over a set period.
This is where a tool like Cheers becomes incredibly valuable for immigrants.
How Cheers Works for Newcomers
Most loans give you money upfront, and you pay it back with interest. But to get those loans, you usually need a credit score. It's a Catch-22. Cheers flips this model on its head with a "credit builder loan."
Instead of giving you cash to spend, Cheers holds the loan amount in a secure savings account. You make fixed monthly payments, just like a regular loan. Once you finish the term, the money is released to you.
This helps you in three distinct ways:
- Speed: When you are new to the country, you don't want to wait months for your data to show up. Cheers uses accelerated reporting, meaning your account and first payment are reported to all three credit bureaus (Equifax, Experian, and TransUnion) within 15 days of account opening.²
- Safety: There is no risk of overspending like there is with a credit card. Plus, there are no hidden fees. Many predatory lenders target immigrants with high rates, but Cheers charges a fixed 12.15% APR, much lower than similar products that may charge up to 36%.³
- Savings: It forces you to save money. At the end of your term, your total savings (minus interest) are returned to you. You can also cancel your account at any time without penalty if your plans change.⁴
Step 5: Leverage Your Rent Payments
For most immigrants, rent is the most significant monthly expense. For decades, this massive payment counted for nothing in the credit world. You could pay rent on time for ten years and still have a "zero" credit score.
Fortunately, you can now use third-party services to report your rent payments to the credit bureaus. Many online services verify your payments with your landlord and send that data to the credit agencies. Since payment history is such a large chunk of your score, getting credit for the rent you are already paying is a smart move.
Step 6: Watch Your Utilization Ratio
Once you have a secured card or credit builder account, it’s essential to manage it responsibly. Which means it’s vital to not max out your card, and to make sure that you're aware of your utilization.
If your limit is $200 and you spend $180, your "credit utilization" is 90%. This looks risky to lenders, even if you pay it off in full. Experts generally recommend keeping your utilization below 30%. On a $200 limit, that means never having a balance higher than $60 at any given time.
If you need to spend more, try to make a payment immediately after the purchase so the balance is low when the statement closes.
Step 7: Monitor for Accuracy
The U.S. credit reporting system is not perfect. Errors happen often, and they can be even more common for immigrants. Variations in how names are spelled, confusion over middle names, or mixed-up addresses can cause fragmented files.
Keeping up with your credit history is your own responsibility. It’s essential to note that you’re eligible for a free credit report from each of the three bureaus once a year (but not limited to that frequency). Make sure that you download these reports and read them. Check the records to make sure your name is spelled correctly, your address is current, and that all the accounts listed actually belong to you.
If you aren't sure what you are looking at, learning how to check your credit score helps you spot red flags before they cause long-term damage.
Building Your Financial Future
Building credit for immigrants in 2026 is a marathon, not a sprint. It’s essential to be intentional and on top of your credit history. From establishing your identify with a SSN or ITIN, leveraging your rent, and diversifying your credit mix, you have all the tools necessary to build your financial reputation and prove your reliability. Once you’re eligible for upgrades, be mindful of the best practices of keeping your utilization low.
If you are ready to accelerate that process without the barriers of hard credit checks or hidden fees, Cheers is here to help. With a plan that builds your payment history and your savings simultaneously, plus accelerated reporting that reaches bureaus in as little as 15 days, you can start seeing results faster. Sign up today and take the first real step toward your financial freedom.
This content is for informational purposes only and does not constitute financial advice. Please consult a licensed financial advisor or tax professional before making any financial decisions.
(The opinions expressed in this article are the author’s own and do not reflect the view of Sunrise Banks, N.A. Member FDIC.⁵)
References
- The newcomer’s guides to managing money (CFPB) - https://www.consumerfinance.gov/about-us/blog/the-newcomers-guides-to-managing-money/
Footnotes
1FICO® Credit Factors: According to FICO®, 35% of your credit score is based on payment history, and 10% is based on credit mix. Cheers reports every payment and adds a secured installment loan to your profile. Source: myFICO: https://www.myfico.com/credit-education/whats-in-your-credit-score
Accelerated Reporting: Accelerated reporting applies to the opening of your account, plus the first payment. Credit bureau reporting occurs monthly thereafter.
APR Comparison & Affordability: Cheers Interest is calculated using an amortized repayment schedule at a fixed 12.15% Annual Percentage Rate (APR). Comparable products may charge APRs up to 36%, according to publicly available terms.
Cancel Anytime & Get Savings Back: At the end of your term, your total savings (minus interest) is returned to you. You can cancel your account at any time without penalty.
Sunrise Banks: Cheers is a financial technology company and not a bank. Banking services are provided by Sunrise Banks N.A. Your funds are FDIC insured up to $250,000 through Sunrise Banks, N.A., Member FDIC.
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