Stay-at-home spouses are going to get a break when it comes to qualifying for credit cards. The Consumer Financial Protection Bureau (CFPB) plans to revise a provision of a rule that required stay-at-home spouses to have their own sources of income to be approved for a credit card.

Since October 2011, as part of the Credit CARD Act, credit-card issuers were forbidden from considering household income when assessing an applicant’s creditworthiness for a new credit card.

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The law was intended to prevent American consumers from taking on more debt than they couldn’t manage.

As a result, however, many stay-at-home spouses could not obtain credit cards because they didn’t meet income requirements, even if household income was enough to repay the debt. These individuals tend to do the bulk of the household shopping — they can reap plenty of savings if they choose to use a rewards or cash-back credit card.

Additionally, in the event that the relationship falls apart, these individuals are left with little to no credit history, which may hinder their chances of getting a job or qualifying for a major loan.

“This is clearly an unintended consequence of the legislation,” Richard Cordray, director of the CFPB, told the House of Representatives Financial Services Committee on Thursday. Corday did not say how the rule with be revised, but a proposed rule is slated for release sometime after Congress returns after the elections.

Under the current rule, stay-at-home spouses with no income can obtain credit by becoming an authorized user or applying for a secured credit card.

As an authorized user of the working spouse’s account, the stay-at-home spouse has access to the credit card and the authorized-user account is also reported on the credit report.

To get a secured credit card, stay-at-home spouses must put down a cash deposit as collateral. Such cards don’t require any credit history but can help build credit. The downside is that secured credit cards usually come with fees or high interest rates.

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Simon Zhen

Simon is a research analyst for MyBankTracker. He is an expert on consumer banking products, bank innovations and financial technology.
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