Stay-at-Home Partner News

Jun 4, 2013 by

credit cardsThe U.S. Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009 forced credit card issuers to evaluate a consumer’s ability to pay before opening a new account or boosting a credit limit. (Issuers weren’t doing this before CARD??) Also, issuers were told they could only consider an applicant’s or cardholder’s independent income or assets in making this evaluation. The alleged intent was to dampen the explosion in credit cards issued to students, but the effect was also to disqualify for a credit card in their name many stay-at-home partners with little or no income.

Consumer Financial Protection Bureau (CFPB) to the Rescue!

On April 29 the CFPB amended the regulations that sprang from the CARD Act to allow credit card issuers to consider income that a stay-at-home applicant, who is 21 or older, shares with a spouse or partner when evaluating the applicant for a new account or increased credit limit. The applicant must have “a reasonable expectation of access” to the third party income.

I wonder how card issuers will evaluate whether an applicant has that “reasonable expectation” of access to a spouse’s or partner’s income. Must you be married? How about ‘shackin’ up’ for the past ten years, is that good enough? I’ve been married sixteen+ years and I’m guessing Ms. Money Counselor might have some thoughts about how reasonable it is for me to access her income.

Lots of Non-Working Married People Affected

About sixteen million married Americans don’t work outside of the home. That doesn’t necessarily mean their income is low or zero—unless of course their vocation is blogging—but no doubt for most their income is lower than their work-outside-the-home spouses.

The CFPB says one of three married couples who may have easier access to credit cards thanks to the regulation change, and “is an example of the Bureau’s commitment to working with consumers and financial institutions in order to ensure responsible access to credit for American families.” (Bureaucrats never miss a chance to pat themselves on the back, have you noticed?)

For those of you interested in the CFPB’s “final rule” implementing the change, here’s a link. It’s only eighty-six pages.

Will You Be Helped?

Have you or your partner been turned down for a credit card due to the CARD Act’s rules? What do you think about the regulation change? Has the CFPB done a good thing?

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