Wid ye credit it!?

Hi, I'm Mick. I've just moved to the DC area and it turns out that the USA is actually a completely foreign country and feels far more alien than France, Germany, Spain or, yes, even more alien than Oxford!

So, the economy in the USA is based on credit. In order to get credit, one must have a good credit history, but to get a good credit history, one must first get credit. Coming from the UK, where I have quite an awesome credit rating, it was a bit of a shock to learn that my UK credit rating counts for exactly nothing, even with companies with whom I have had a relationship in the UK for many, many years (fuck you very much, Barclaycard!). It turns out that data protection laws generally prevent EU-based companies from sending your credit file abroad. That's the excuse anyway.

I tried being extra-prepared and bringing my credit report with me but this also didn't help because I assumed that the bank folk would have an ability to think and act independently. However, if the computer says no credit, then that's pretty much that. What I found really weird though is that I was offered a car loan before a credit card....

Bank: "Oh, Dr Craig, I see you're a fellow at the NIH. Would you like an auto loan to buy a new car, as you just got here?"

Me: "No thanks, we've decided that we won't need a car: our bikes and public transport should cater for all of our needs."

[stunned silence]

Bank: "Oh, well, I guess that's one way to live. Erm, is there anything else I can do for you?"

Me: "Actually, yes, a credit card would be helpful."

Bank: "No, sorry Dr Craig, you don't have a credit history so we can only give you a secured card where you give us $1000 deposit, and we give you a credit card."

Me: "What would the limit be?"

Bank: "Why, $1000 of course."

[....]

Me: "So. I give you $1000 of MY money which you then lend back to me, and both use my money to invest and make profit, and charge me for the privilege?"

Bank: "Yes, that's one way to look at it, I suppose. But this is AMERICA. You NEED a credit card even more than a car..."

[sound of head being banged against a wall]

Secured credit cards are my favourite new thing to hate. Basically, banks will offer you a credit card if you give them a deposit to secure the card. Which sounds fair enough. Except that the deposit is expected to cover the entire credit limit. So you give the bank, say, $500 or $1000 of your cash. They then hold on to that and give you a card of the same limit, with a very unpleasant interest rate. The idea is that you demonstrate your ability to maintain a line of credit by your responsible use of the card. The reality is that you give the bank an interest-free loan for a year in order to bribe them to say you're creditworthy. And that's assuming you're not daft enough to actually leave a balance on the card and be billed >20% interest when the bank LENDS YOU YOUR OWN CASH.

Crazy. Absolutely mental. And don't get me started on cars...