If you’re a Canadian in the process of moving to the United States, you might be wondering if your credit history will be coming with you. Unfortunately, your Canadian credit score and history cannot transfer to the U.S. The good news is that there are ways to help you build credit in the U.S., and you may even be able to snag a U.S. credit card using your Canadian credentials. Once you have some credit history under your belt, you can start working towards your financial goals.
Key Points
- Your Canadian credit history and score cannot be transferred to the U.S.
- If you relocate to the U.S. from Canada, you must build your credit profile from the ground up.
- Building good credit right away once you relocate is important to help you secure various credit products in the U.S., like car loans, credit cards, and mortgages.
Does My Canadian Credit Score Transfer To The U.S.?
As mentioned, the answer is no, Canadian credit history cannot be transferred when you move to the U.S. The reason for this boils down to the fact that credit information cannot be transferred across national boundaries due to legal and practical issues.
Why Can’t I Transfer My Canadian Credit History To The U.S.?
While TransUnion and Equifax exist in Canada and the U.S., there are still certain laws and regulations that prohibit the transfer of Canadian credit histories to the States. Here are some reasons your credit history can’t move with you:
Different Credit Report Requirements
There are legal implications involved with transferring credit history information across national borders. Credit reporting laws differ from country to country. This means that the existing credit report you have in Canada would have to meet the credit reporting requirements of the U.S., which are governed by the U.S. Fair Credit Reporting Act requirements.
Credit Report Information Is Different
The information within a credit report is different from country to country, which is why the transfer of information can be difficult. As an example, some countries report on all the individuals within a household in one report, while others have a unique report for each individual. Moreover, some information that’s included in your Canadian credit report may not be included in a credit report in another country.
As such, if credit history information could be transferred from Canada to the U.S., it would have to be adjusted to meet the U.S. credit reporting laws. The same would apply to any credit information transferred between two other countries. It would be challenging and time-consuming to convert historical credit data to meet U.S. standards, which is why it isn’t done.
Technological Barriers
Technological resources used for credit reporting can greatly differ from one country to another. Transfer between two countries simply might not be possible if the systems and software are not compatible.
Differences And Similarities Between Canadian Credit and American Credit
Credit scores and rating systems differ across nations. But these systems are quite similar between Canada and the U.S. That said, there are some slight differences between the two.
Credit Bureaus
Both Canada and the U.S. have credit bureaus that collect and create reports using your credit information. This information is submitted by lenders, credit card companies, banks, and other institutions you have a financial relationship with.
These lenders are not required to submit information, but they choose to. Using the collected data, the credit bureaus will create a credit report and calculate your score. Whenever you apply for financing, potential lenders will pull your credit report to aid their decision-making process.
Canada’s credit bureaus include Equifax and TransUnion, which are also bureaus in the U.S. However, the U.S. has a third credit bureau: Experian.
Credit Score Ranges
In Canada, credit scores range from 300 to 900. In the U.S., credit scores range from 300 to 850.
Credit Ratings
Canada has an additional credit rating system that the U.S. doesn’t have. In Canada, credit ratings are made up of a letter — either I, O, R, or M — and a number from 1 to 9. The combination of these figures represents your creditworthiness.
| Canada | U.S. | |
| Credit Score | Ranges between 300 – 900 | Ranges between 300 – 850 |
| Credit Bureaus | TransUnion and Equifax | TransUnion, Equifax and Experian |
| Credit Rating | Credit accounts are assigned a number from 1-9 and a letter, either I, O or R. | Doesn’t exist in the U.S. |
How To Build Credit History In The U.S.
Building credit in the U.S. isn’t difficult, but it does take time and diligence. To build credit history in the U.S., follow these steps:
Get A Social Security Number (SSN)
A Social Security Number is essentially the American version of a Social Insurance Number (SIN). While you may be able to secure credit products in the U.S. without an SSN, it may be difficult to build a credit profile in the U.S. without one. That’s because an SSN is required to ensure that your credit file is reported to the credit bureaus. This reporting is what helps you build your credit history in the U.S.
To qualify for an SSN as a non-U.S. citizen, you must have some sort of work authorization in the country. Otherwise, you may be able to apply for an Individual Taxpayer Identification Number (ITIN), which the Internal Revenue Service (IRS) issues to non-U.S. citizens who don’t have an SSN.
Open A U.S. Bank Account
A U.S. bank account can help you apply for a U.S. credit card or credit line. It can also provide you with a way to show that you’re financially responsible. Depending on which Canadian bank you’re currently a client with, you may be able to open a U.S. account without a U.S. address or SSN. Canada’s Big 5 banks can typically help with this.
Take Out A U.S. Credit Card
A credit card is a simple way to start building a positive payment history. Several U.S. credit cards are designed for individuals with poor or no credit history.
As a Canadian, you may not need a U.S. credit history to apply for some U.S. credit cards. You may be able to use your Canadian credit history to qualify you for these cards.
If you’re having difficulty obtaining a regular credit card since you have no credit, consider getting a secured credit card. These cards almost guarantee approval. You simply need to provide the minimum security deposit.
Once approved, you can use your secured card like a regular credit card. Payments will be reported to the credit bureau(s), which can help you build your payment history.
Pay Your Bills On Time
Having a credit card is perhaps one of the best ways to build credit in the U.S. However, how you use the card matters. Namely, you’ll want to make timely payments on your credit card monthly.
Payment history is a key component of your credit score, so making timely payments can help you build a positive credit history. However, missing payments can hurt your credit-building efforts.
Don’t Carry An Outstanding Credit Card Balance
If possible, try not to use more than 30% of your available credit to keep your credit utilization ratio low. This refers to how much you spend relative to your total credit limit.
Maxing out your credit card will make it more difficult to pay your bills in full every month and will increase your credit utilization ratio, which can have a negative effect on your credit profile. Instead, keep your balances low and pay off the full balance monthly.
Have Your Rent Payments Reported
Rent reporting services are available in the U.S. which report rent payments to the credit bureaus. Typically you can’t use your rent payments to build credit as they aren’t reported to the bureaus. But with these rent reporting services, you can use your timely rent payments to establish and build a positive credit history.
Bottom Line
When moving to the U.S., your credit information and report will stay in Canada and won’t follow you. That means you’ll need to build your credit from scratch in the U.S. The good news is that there are simple steps you can take to build credit in the U.S. As long as you remain diligent and responsible with your financial habits, you should be able to build healthy credit in the U.S. within a few short months.
