Self-Development – How to Issue A Loan for A Foreigner?

Self-Development - How to Issue A Loan for A ForeignerThe share of foreigners in the United States is 14%. This is a large market for banks, but not everyone dares to serve such clients. These are mainly special financial institutions and monoline banks.

Statistics of foreigners in the USA

Population of the United States, according to the U.S. Bureau Census as of October 21, 2019, is 329.87 million. About 45 million of them (13.7%) are foreigners, people born in other countries. At the same time, 10.5 million immigrants (23%) are “unauthorized”, that is, they have no legal basis to stay in the United States.

The main supplier of immigrants to America is Mexico (Mexicans make up a quarter of all immigrants), followed by China (6%), India (6%), the Philippines (5%) and the Republic of El Salvador (3%), according to a study of the American Pew Research Center. Most immigrants live in California (24%), Texas (11%), Illinois (10%) and New York (10%).

The U.S. Census study highlights another number – the average income of an American household in 2018 was $ 61,937. It exceeded not only the figure for 2017 (by 0.8%), but also the pre-crisis 2007. The indicator is different for different races. For example, the median income of Hispanic households is $ 51,404, and that of Asian households is already $ 87,243 (the highest among ethnic groups).

Who to address if you move to the USA?

Fintech company Stilt surveyed 3,000 American immigrants in 2018 and found out where they keep their money. The poll showed that 82.6% of them trust the following banks: Bank of America (over a third of them), Chase, Wells Fargo, PNC Bank, Citi. The rest of the foreigners have accounts with 64 other banks and credit unions. At the same time, the overwhelming majority – 94.7% – are served in one bank, only 5% of immigrants have a second bank account.

It is noteworthy that in the 5 largest national banks there is one local – PNC Bank, headquartered in Pittsburgh, Pennsylvania. It operates in only 19 states of the country, mainly on the East Coast. Its products are popular with students as well as those who appreciate the benefits of online banking.

As for Bank Of America, a leader in the immigrant community, its reputation is now spoiled. At the end of the summer of 2018, American media and Internet forums were full of texts that the bank began to ask its customers for additional confirmation of their legal presence in the United States. The accounts of the bank’s clients who could not provide documents were frozen. Also, additional checks affected immigrants with a second passport issued by countries that are under US sanctions.

Documents required

Is it really so difficult for an immigrant to open a bank account in the United States? There aee no problems with debit cards. At the bank department, where you have to come in person to go through identification, you will be asked to present a valid passport, driver’s license (in the USA it also serves as an ID), birth certificate, as well as electricity or water bills confirming the place of residence.

You also need a Social Security number, it is issued only to legal residents of the United States and gives the right to work and get social benefits, and also contains information about the income received. If the immigrant does not have an SSN, then the ITIN (Individual Taxpayer Number) or Alien Number (the number USCIS assigns to everyone entering the country) will serve as a confirmation document.

It is more difficult with credit cards. Here you will have to gain a credit history, which is built by years of respectable relations with banks. Credit history is reflected by the Credit Score, which ranges from 300 to 850 points. If it is above 700, then American banks automatically consider a resident of the country as a good client and themselves send him a variety of loan offers.

You can find out your Credit Score level both at the bank branch and on special resources, such as Credit Karma or Experian.

Lenders online – alternative to bank financial products

What should immigrants do if they do not have the necessary documents, which means they cannot be served in the largest banks, but they still build their lives in the USA – they buy cars and houses? For them, more and more financial offers appear on the American market.

For example, there are special referral services which specialize in issuing payday loan online Illinois and any other states. No problems will appear if you have no SSN or any other document.

The application is reviewed within several minutes. The lenders from the online networks issues a loan for up to $2,500 for up to 30 days. The funds will be deposited to you in any convenient way for a client. You won’t be asked to send any confirmation certificates.

Special products for foreigners

Also a special product for foreigners is offered by First Century Bank, which is based in Georgia. Its product is a credit card called CreditStacks (issued under the MasterCard license), promoted under the slogan “The first card in your wallet”. To submit an application, which can be completed before moving to the United States, you do not need an SSN, as well as local income, the credit limit is up to $ 5,000 (rate 17.24%). In 2018, the project won two startup pitches.

Quontic, a small bank headquartered in New York, specializes in mortgage financing for immigrant families, which account for 75% of its client base. The bank, which began expansion in 2016, now operates in 50 states. Quontic’s loan rate is 5.75% per annum, a rate higher than the national average.

But there are also more venerable players on the market. Student credit cards are one of Discover Bank’s main lines of business, which issues them to students even with a zero credit rating. For the first six months, students can use borrowed funds at a rate of 0% per annum, then it is 14.74-23.74%. Also, the bank does not charge a commission for cross-border transfers, and the cashback reaches 5%. The bank is headquartered in Delaware, was founded in 1911 and today operates more than 50 million credit cards.