What Happens to My Credit When I Move Outside The United States?

“John, my husband has taken a new job overseas and I think we’ll be there for at least 3 years. We’re both 32 years and have about 10 years of credit experience under our belts. What’s going to happen to our credit reports when we move?”

First off, your U.S. based credit report is not transferred to another country so you won’t get any benefit of your credit report and credit scores on the U.S credit bureau system.  You’ll have to establish a credit report in the country to which you are moving, that is, if the country even offers credit and has a means to compile credit information. Not all do.

Credit information can be compiled by the government or private companies.  The key reasons that the credit information can’t be transferred to another country are that each country has different data suppliers, currency, and their laws and restrictions.

The companies that supply credit information differ from country to country.  Some countries only permit reporting of negative information, which are usually credit bureaus run by the government. Some, like in the U.K and Canada, are very similar to the bureaus in the States.

There are still few creditors that are truly “global.”  Banks, retailers, auto lenders, mortgage lenders, and courts are usually unique to each country.  The data suppliers report information based upon the individual’s address and an address outside that country will usually be rejected.

Currency differs by country, except the European Union. Data suppliers report the amount owed, loan amount and credit limit in the country’s currency.  If you move to another country and use your credit cards issued in the U.S. such as American Express, MasterCard or VISA, the currency would be reported in U.S. dollars and subject to exchange rates and fees. You would need to contact the card issuer to change your billing address, and determine if they will permit you to continue to use the card.

Each country has different laws concerning how credit information can be used in granting credit, including who has access to it, and what information can be reported.  Many countries will not allow the data to leave the country, because their privacy laws cannot be enforced.

It is very challenging to keep up with all the laws regarding credit worldwide, let alone in the U.S. For example, in the U.S. there are both Federal and State laws concerning credit reports and credit scores.

Not that it’s paramount but computer systems are not necessarily compatible from country to country.  Even the three major credit reporting agencies in the U.S. – Equifax, Experian and TransUnion – own credit bureaus in other countries, but the databases are not relational or compatible. Each has their own unique identifiers for matching individual data to the databases and a different format in which the data suppliers need to provide the information.  For example, the U.S. uses Social Security number, name and address to match up information.   Some countries use the mother’s maiden name as their last name instead of their father’s, which changes the matching rules.

When you move to another country, you need to establish credit in that country.  If your credit card issuer also reports to that country, you may be able to change your mailing address to that country and use it to create a credit file in that country.  If that isn’t possible, you should contact a financial institution in the country to which you are moving to determine what you can do, such as a secured credit card that is backed with the same amount as the credit limit.  If you plan to move back to the U.S., you should try to keep accounts open, so that you credit remains active and you have an active credit report.

JRU on 60 Mins SetCredit Reporting Expert, John Ulzheimer, is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

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