In case you’re born in the States, acronyms such as H-1B, L-2, O-1 and F-1 are likely to be, for you, just a bunch of senseless letters and numbers. But foreign citizens will recognize them instantly as just a few of the visa options to work or study legally in the U.S.
The profiles of people who can apply for these visas vary a lot, from managers to international students and individuals with extraordinary abilities. However, they’ve all one thing in common: they don’t have a credit score because many foreign countries don't use such a metric.
Under these blank slate conditions, getting approved for a U.S. credit card is almost impossible, as Amitay Kalmar, CEO of Cambridge-based startup Lendbuzz, discovered firsthand when he arrived at MIT as an MBA student from Israel. To pay his tuition, he wired funds to a newly-opened checking account and asked Bank of America for a credit card. But the bank denied his request, claiming that Kalmar had zero credit history at that time.
"I was shocked that I was denied for a credit card," he said. "That's the first time I have learned that there is such a thing called credit history."
With his own personal experience in mind, Kalmar teamed up with fellow MIT researcher Dan Raviv and launched Lendbuzz in the summer of 2016. The company is an online service aimed at international professionals who arrive in the U.S. and need a loan to buy a car.
Many U.S. banks wouldn't even consider their requests, given the absence of a credit history. Instead, Lendbuzz takes into accounts other factors, including their educational background, their employment history, and their earnings potential in the U.S. based on what they study and where they study. When customers are pre-approved for a loan, they chose the car they want online and Lendbuzz wires the money to the car dealer.
It's worth pointing out that getting approved for a car loan from Lendbuzz and paying it back count as a way to start building U.S. credit history.
Lendbuzz can provide the money to selected applicants thanks to a recent $12 million round led by GCP Capital in New York City, according to Kalmar.
The company, which is not profitable yet, said it has given loans in at least 22 states including Massachusetts, New Jersey, New York, and Texas. In the future, it'll likely start offering more financial products to international professionals, including student loans, mortgage loans, and auto insurances.
