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US Bank Accounts and Money Transfers

What types of banks and bank accounts exist in the US? How do you choose the right bank for you? Find out about different types of bank accounts, building up your credit history, and making money transfers in this InterNations guide on US banks.
It is important to build up a good credit history if you want to take out a loan in the US.

Opening a Bank Account

The following documents are necessary to open a bank account in the US:

  • Passport
  • Proof of address (driver’s license, phone bill, electricity bill, or other official document with your name and address)
  • Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN)
  • Initial deposit

You might be asked if you wish to have overdraft coverage or overdraft protection when opening a checking account. Overdraft coverage means that if you don’t have adequate funds in your account, your bank will still pay, but you will be charged a hefty fee for each transaction. Overdraft protection is when you link your checking account to another account or credit card, and money is automatically drawn from this source if your checking account is empty.

Loans and Credit History

If you plan on buying a house or making any other large purchase which requires a loan during your stay in the US, you will need to build up your credit history. When banks in the US are deciding whether to give you a loan, they will look at your credit score to make their decision. Your credit score shows how likely you are to pay back a loan. Higher credit scores will make it more likely for you to be approved for a loan, and get you a better interest rate. Even if you have built up your credit history in another country, your credit rating will often not transfer to the US.

You can build up a strong credit score by maintaining one or two credit cards and paying your bills on time every month. If possible, try to pay off the entire bill, but at least be sure to keep your balance at 30% or less of your credit limit. You should also be sure to only apply for the credit you need. So, if you really want a loan to buy a house, it is best to hold off on buying that fancy sports car you want, if that would mean having to take out a loan.

When deciding whether or not to give you a mortgage loan and settling on the interest rate, banks will also look at your savings, your income, how much debt you have, and your total assets. CreditSesame and AnnualCreditReport are useful online tools which offer advice on how you could improve your credit score and show you what causes it to fluctuate.

Money Transfers

Wire Transfers Through Your Bank

Wire transfers are the safest way to transfer large amounts of money between countries. There are several different options for making money transfers from the US to other countries. If you have an account with a large, multinational bank, you can usually do a wire transfer through them. As an account holder at that bank, some fees may be waived, but you should still be aware of possible state or local taxes and fees payable by the sender or receiver. You should also check what the exchange rate is, and if it is locked in place or can change at the last minute.

To make a wire transfer overseas, you will need the name of the account holder, as well as the Bank Identifier Code (BIC) and International Bank Account Number (IBAN) of the other person’s account. International wire transfers from the US can cost anywhere between USD 20 and USD 50, and that’s just on your end. It can take anywhere from a couple hours to a week to transfer the funds.

More Tips for Transferring Money

If you do not have an account with a major bank, you can make a transfer through a foreign exchange company such as Western Union. Here you will also need to watch out for fees. There are also online services, such as PayPal and Skrill, which allow you to transfer money over the internet.

If you plan on making frequent wire transfers, your bank can often give you a PIN, with which you can make the transfers online or over the phone, instead of having to show up in person at the bank each time. If you are going to be transferring large sums of money on a regular basis, this may be a reason to open an account with an international or offshore bank that caters to the needs of expats. It is a good idea to seek professional financial advice before transferring large amounts, so that you don’t risk losing a substantial percentage to taxes and fees.


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