Stay-at-home spouses and partners may find it easier to get credit cards under a regulation revised by the Consumer Financial Protection Bureau.

The change, first proposed by the bureau last fall, lets spouses and unmarried partners who are 21 or older and don’t work outside the home, apply for credit based on shared income.

“Stay-at-home spouses or partners who have access to resources that allow them to make payments on a credit card can now get their own cards,” the bureau’s director, Richard Cordray, said in a prepared statement.

The move was made to fix an unintended consequence of the Credit Card Accountability Responsibility and Disclosure Act, known as the CARD Act, which became law in 2009. The law requires credit card issuers to evaluate an applicant’s ability to make payments before opening a new credit card account. Generally, under current regulations, card issuers may only consider the individual applicant’s independent income or assets.

The requirement was meant, in part, to protect students from getting into trouble with credit card debt, but it also ended up making it difficult for others to get credit cards. The bureau said data from the credit card industry suggested that otherwise creditworthy applicants were being denied cards and that a “significant number” of them might be stay-at-home spouses or partners. (Comments from the industry noted that military spouses were particularly affected.)

Under the revised rule, applicants who are 21 or older can rely on other income, including that of the working spouse or partner, if the applicant has a “reasonable expectation” of access to it. The bureau said it considered more than 300 comments from the public and industry before deciding on the revision.

Since same-sex marriage is recognized in just a handful of states, the inclusion of “partners” in the rule change is significant for gay couples. The rule applies to all applicants, regardless of marital status, the bureau said.

The bureau noted that Census data indicates that more than 16 million married people do not work outside the home, meaning roughly one out of every three married couples may now have easier access to credit.

The amendment has been submitted for publication in the Federal Register, the bureau said, and becomes effective upon publication. Card companies have six months after publication to comply with the new rule.

Do you think the change makes sense? Could this affect your access to credit?

Article source: http://bucks.blogs.nytimes.com/2013/04/29/credit-eased-for-stay-at-home-spouses-and-partners/?partner=rss&emc=rss