CFPB Proposes Making it Easier for Stay-at-Home Spouses and Partners to Get Credit Cards

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On October 17, the Consumer Financial Protection Bureau (CFPB or Bureau) proposed updates to existing regulations to make it easier for spouses or partners who do not work outside of the home to qualify for credit cards. The proposal "would allow a stay-at-home spouse or partner to rely on shared income from his or her spouse or partner when applying for a credit card account."

The Bureau statement made it clear that it was taking action to reform regulations issued by a predecessor agency. "Under current CARD Act regulations issued by the Federal Reserve, a card issuer generally may only consider the individual card applicant’s income or assets."

Data made available to the Bureau suggest that some otherwise credit-worthy individuals have been declined for credit card accounts under the current regulation, even though they have the ability to make the required payments. Discussions with industry sources indicate that a significant number of these individuals may be stay-at-home spouses or partners with access to income from an employed spouse or partner.

The Bureau’s proposed revision would allow credit card applicants who are 21 or older to rely on third-party income to which they have a reasonable expectation of access. Although the proposal applies to all applicants regardless of marital status, the Bureau expects that it will ease access to credit particularly for stay-at-home spouses or partners who have access to a working spouse or partner’s income.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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