Credit Cards
I initially kept on using my Dutch credit cards, so there was no real need to have an American one. My cards enabled me to transfer money from my Dutch accounts to the US without having to pay money for wiring it. Secondly, the deduction of the credit amount from the bank is automatic (making it equivalent to the new US "debit" card), while in the US you have to issue a separate check to repay the credit card company for your credit, resulting in more work.
For the sake of the experiment, I did apply for a credit card at my bank. That was less easy than I thought: A couple of weeks later I received a letter stating that my application could not be granted due to insufficient credit history. Don't be surprised if that happens to you as well: it is their standard policy.
The bank/credit card companies check your credit history with a number of (commercial) institutes that build up that information. These companies receive information from the credit card corporations and mortgage institutions on a voluntary basis. There is, apparently, not a lot of worry about privacy issues in this area.
In Europe, the credit cards need information about your ability to pay bills, such as regular and sufficient income. In the US, you could earn a million dollar but will be rejected by the credit card company if there is insufficient credit history. Here, the banks want to know if you pay your bills. That is more important than the amount that you have on the bank. The best thing you can do to get the history is to get a loan or mortgage, because it is easier to get a credit card if you owe people money. This is a chicken-and-egg problem that can only be solved by using a reference (= other expat, neighbour, landlord, etc.) that has a credit history, or by building up a credit history by applying for supermarket credit cards. These last ones are often easier to get, and once you have purchased several times on that card, and paid your bills, you build up the credit history (somewhere). In case you use a reference: You need name, address, social security number, employer name, address and employment time, credit card number, and yearly salary of this person, or have the person bridged-in on the phone with your bank. That will make them responsible for your credibility up to the moment that you have acquired sufficient credibility yourself: a period of six to twelve months.
Anyhow, several ‘insufficient credit history’ letters later I got fed up with it and quit. The alternative mentioned to me was to apply for my own company’s credit card. This would eliminate the credibility issue, so it was said. However, my company’s credit card also turned down my application because of ‘insufficient history’. In my case, some persistence and requiring to speak to a supervisor gave the desired result, but only after they called the Social Security to verify my number.
Several weeks after having received the card I noticed that I could have had it earlier, without problems, if I would have used the telephone number dedicated for employees in place of the general ‘800’ number. Check with your company if such a "backdoor" exist, otherwise there is no alternative than to suffer for months (or years) through the slow process of building up credit.
The good news is: once you are in the system you will never get out. So if you managed to get a bank account and credit card during your expat years and ever return to the US you can basically do as you please with respect to loans and mortgages. The reverse is also true: once you are know as a person with "bad credit" it will be tough to get away from that status except by paying all your checks perfectly on time for years.
An emerging payment alternative in the US is the debit card. This card is linked into your US bank account and payments are automatic. The debit card system is getting very close to the system that has been in use in Europe for some 20 years, and eliminates the hassle of having to separately pay your credit card company every month. It also avoids the process of getting a credit rating. As long as you have money on the bank you can use it to pay for your purchases. Many US banks have either implemented the debit bank card or have announced that they will start with it soon ('99).