# Canadian Banking Questions...



## moconnell (May 17, 2010)

Hi all,

I've posted a couple questions here already and find the responses so helpful! Thank you! To recap: my husband and I are Canadian citizens looking to return to Ottawa next year. We have decided our target move date is Summer 2011. We're looking into establishing bank accounts, credit lines, etc. now so that we can start building credit up north (our credit reports are totally empty now since we've been out of the country for over six years and have no open accounts up north).

Question #1: My husband talked to a private banker at Harris Bank who told him that he cannot open a bank account until he has a Canadian address. That makes no sense to me! Does anyone know if all banks are like this?

Question #2: Our first credit card will probably have to secured, right? We are thinking that we will probably rent a house for a year, and will likely buy a house in 2012. I know we can use US credit to get it, but some lenders seem reluctant to do that. So we would like to build our Canadian credit as fast as possible. Anyone know how to do that? Is a secured credit card less valuable than a "real" credit card in terms of building credit? Should we open up a line of credit? We aren't big fans of credit products in general, and like to pay cash. But I realize that we will likely have to open up a credit card, use it, and pay the balance in full every month. Any one have any advice on how to build awesome credit in 12-18 months (Auld?) in Canada?

Thanks so much!


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## Auld Yin (Mar 10, 2009)

moconnell said:


> Hi all,
> 
> I've posted a couple questions here already and find the responses so helpful! Thank you! To recap: my husband and I are Canadian citizens looking to return to Ottawa next year. We have decided our target move date is Summer 2011. We're looking into establishing bank accounts, credit lines, etc. now so that we can start building credit up north (our credit reports are totally empty now since we've been out of the country for over six years and have no open accounts up north).
> 
> ...


I don't think the Harris banker is 100% correct. If you open an account in Canada with US address it will be classed as non-resident and subject to the 15% witholding tax on any interest earned. Provided your husband has full photograph ID I do not believe it should not be opened. Now, if he deposits a cheque drawn on a US bank it will probably mean the funds will be placed on hold (unusable) for a minimum of 30 days.
I don't believe a secured credit card to be less valuable than an unsecured one. Usually you'd agree to secure it for say 1/2 years which would allow the bank to develop some sense of how you conduct your banking. If you prefer not to use credit I see no reason in opening a line of credit and if you did I suspect it would have to be secured also because you would still be a non-resident. The banks in Canada do have access to the US credit bureaux reports.
You mentioned that your husband spoke with a Harris banker. Do you bank with Harris in the USA? If so I'm sure you know that that bank is fully owned by Bank of Montreal in Canada and your Harris banker could easily write a reference letter to its Canadian masters outlining your banking record with them.


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## Jared (Jun 15, 2010)

I started up a new account with RBC yesterday and was told there wouldn't be a problem with me having an address elsewhere in the world if I moved away from Canada, so I assume that the same policy would apply if you were just starting out?

A good way of building up credit history quickly is to take out a personal loan, even if you don't need it. That and a couple of credit cards seems to be a good start, but there are other ways to build it up too.

Although you'll need the credit history to get the personal loan most likely... vicious circle.

You'll have to secure your credit card for at least a year (credit unions seem to opt for this) or two (my CIBC one was like this).

Not sure if you can transfer your banking in the US to a canadian based bank down in the US (TD, RBC etc) and whether that would give you better "karma" with their branches north of the 49th?


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## moconnell (May 17, 2010)

Thanks for the quick replies.

Auld- We only used Harris Bank because it is a private bank in Canada and one of our expat friends (who recently returned from Ireland back to Canada) raved about this guy. Well, he did not seem overly helpful. We bank with Chase in the U.S. Do you know if they have a Canadian partner? Would a letter of reference from Chase help? We don't mind doing a secured loan or credit card. I just question how much it helps credit rating since there is no risk involved (if I put $5000 down, and have a $5000 credit limit, there is zero risk for the bank, know what I mean? I don't see how it shows credit worthiness...). Any advice on how much to request for a credit card/loan on a secured loan? I figure $500 is probably not enough, but would a large amount make us credit risks?

Jared- Interesting. We were actually thinking of transferring to HSBC. They are very global, and there is a branch in Chicago (where we live now) and one in Ottawa. They also have a new immigrants program in Canada where you put $25000 down and they set you up with credit cards, loans, etc. Although I am not sure we qualify since we are Canadian citizens! I guess we need to reach out to those folks... What amount would you recommend in credit card/personal debt? Have you been in Canada long? I'm just wondering if you've pulled your credit bureau recently. I'm trying to get a feel for what a expect after six months, a year and two years after re-establishing credit.....

Thanks guys!


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## Jared (Jun 15, 2010)

HSBC would be a good way to go if that works - I've considered switching to them for the global nature, but never bothered yet.

Have never seen Chase on this side of the country, nor the other as far as I can remember... Also, be careful when banks say that they've got "partners" in other countries. Typically that means that there is one fee that you won't be charged when wiring funds... that's it. I got the same speil from RBC the other day "Oh we're partners with (Australian Bank), it'll be flowery and amazing" and it turns out that the other bank won't charge you their $10 fee for accepting a wire transfer.

Haven't pulled my credit history while I've been over here, however I believe it's probably still not got much to it. I didn't bother with a loan or anything though, as I'm here on a working permit and we're not allowed loans 

Amount of credit/personal debt? Not sure - whatever you feel like running up!

That HSBC deal sounds like a winner for what you're looking for...


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## mvs70 (Sep 16, 2009)

Jared said:


> HSBC would be a good way to go if that works - I've considered switching to them for the global nature, but never bothered yet.
> 
> QUOTE]
> 
> Not sure if the 'global' nature of HSBC is as real as they'd like to make out. May work out in North America, but when we saw that there was an HSBC branch where we're moving to in Ontario, seemed ideal (especially to wire money) However, UK branch says they have no links /direct lines of communication with Canadian counterpart - same parent bank, but different set-up entirely... More 'partnership' smoke and mirrors as Jared alludes to.


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## moconnell (May 17, 2010)

Hi all,

I just wanted to share some more info I found out. My husband talked to an HSBC private banker. She was super helpful (my husband's best friend know her, so I am sure that helps!).
She told us you can have a bank account/credit card as a non-resident, but she's not sure if it gets reported to the credit bureau if it's marked "nonresident" (she's checking on it!). She also said that at HSBC, they can give a mortgage out to someone with a 12 month long credit history. They will not pull US bureaus unless you have 40% or more to put down (which is fine, since we're probably going to rent at first anyways). 

Oh, and timeline wise, she said they would do a secured credit card for 5-6 months, and then they would give us an unsecured cc/line of equity. My husband's parents have all of their money with HSBC and my husband's friend works for HSBC as well, so I am not sure if that is standard protocol, or if we are getting a favor because of all of our ties to this bank. Hope that helps!


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## baalat (Apr 16, 2009)

nice info moconell

i'm about to move and did some research about this
checked 3 banks: TD, RBC and Scotiabank

they all have secured cc
RBC and Scotiabank have 'newcomers' packages
BUT Scotiabank would issue a regular credit card instead of a secured one!?!? check their website under 'newcomers to canada' (right menu)

maybe someone could verify this in Canada?


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## MandyB (Jan 14, 2010)

We opened a bank account when we visited Canada on the basis that my husband was returning to find work 3 months later. We used a friend's address as that was where he would be living on his return. They needed our passports for verication and that was it. Very easy - CIBC bank.
We use MoneyMart - top up credit cards - so we fill it when required then make sure it has a zero balance the rest of the time - to avoid $7 monthly charge. So in essence we have free credit.
When we first arrived we rented a property and all the utility companies asked for a deposit fee on top of the first month's bill. Then after a year it was refunded and we were set with just bills for useage.
Hope this helps a bit.
MandyB


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## ChrisGraham (Jan 15, 2008)

*SIN appears to be more important*

I had no problems opening a Canadian bank account after getting my SIN. I had a place to live (hotel) yet that wasn't a problem as this was a checking account and I moved within 3 weeks to my house. 

For my situation I find found the following my list of priorities:

One of your first moves should be to get your SIN. 
Get your mobile and internet access (Rogers is terrible!!!)
Get your bank account
Get your house
Get your car
Apply for your PR Card (takes a long time). 

I was offered a job before I arrived so a job could rank in your priorities. 
I have a UK credit card and await to set one up in Canada. 

Cheers Chris


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