CFPB Changes Stay-at-Home Spouse Rule

CFPB Changes Stay-at-Home Spouse Rule

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The federal government's consumer watchdog has changed a regulation to make it easier for stay-at-home parents and others who don't work to be approved for new credit cards.

Monday, the Consumer Financial Protection Bureau finalized a regulation change to allow card companies to consider financial support from other people when evaluating a consumer's credit-card application. It changes a 2011 regulation under which banks were allowed to consider only the applicant's income.

The 2011 regulation and its more accommodating new version both grew out of the Credit CARD Act of 2009. Its underlying purpose was to clamp down on students getting cards and racking up debt they couldn't repay, and it required individuals applying for credit to demonstrate an ability to repay what they borrowed.

As originally written, though, the regulation had a side-effect impacting more than students: Its "ability to repay" language meant that anyone who relied on someone else's income -- including stay-at-home parents or spouses who are divorced and don't work -- suddenly had a harder time being approved for credit cards and building credit histories in their own names.

"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," CFPB Director Richard Cordray said in announcing the rule change.  The agency proposed the change in October 2012, calling it a common-sense move.

Instead of just an individual's income, issuers can now consider broader measures, such as "available income" or "accessible income." Previously an issuer could not consider household income -- which used to be widely used on credit-card applications -- without confirming how much money the applicant has access to in order to pay bills. The changes apply to people 21 and older. 


Census data show that there are roughly 5 million full-time, stay-at-home moms and roughly 150,000 stay-at-home dads in married households with children. The numbers are higher if you add in other family arrangements such as unmarried couples, part-time working parents, married couples with no children, and adults caring for their aging parents.

The bureau's modification comes after a bipartisan Congressional group pushed for the change. The House Subcommittee on Financial Institutions and Consumer Credit held a hearing on the topic in June 2012.


Read more: FoxBusiness.com

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The Busy Life of an Army Family

TimBlog.jpgThe last several weeks have been non stop for our family.  There have been trips, sports events, family visits, etc. It seems like there is a never ending stream of things to do and places to be.  I find it hard to imagine a stretch of more than a few days where we have nothing planned. Take this week, for example.  Yesterday, my oldest had a football game, while at the same time our battalion (for which I play) was in the championships of the base racquetball league. Somehow, my wife and I managed to cover down on both, all the while dragging three other kids along for the ride.  Tonight is not much different. The battalion has its Halloween party while my oldest is again at a football event (this time playing in the band). Add to that our martial arts class (which I teach).  I can envision my head hitting the pillow tonight and my eyes closing quickly afterwards.  And this isn't the last of it this week.  Friday night there is a school Fall Festival while one of the kids has to be out of town at a different school event.  At least the price of gas is going down...

For the rest of the story, visit Tim's blog at: http://armyspouseami.blogspot.com/2013/10/the-busy-life-of-army-family.html

 

About the Author:  Tim currently lives in San Angelo, TX and is a stay at home dad raising four beautiful children.  He is the proud spouse of an Army Lieutenant Colonel who does his best to keep up with the kids and all of their activities.  He enjoys playing the bass and the occasional bass guitar building project. You can follow him on twitter if you so desire...@ArmySpouse007.



 

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