The Consumer Financial Protection Bureau decided to allow credit card applicants over 21 years old to apply using household income, a reversal from its last stance, according to CardHub, a credit card comparison website.
The decision reverses the Credit CARD Act of 2009, which required stay-at-home spouses to apply for credit using their individual income, instead of the spouse’s.
While the recent moves by the CFPB promotes spousal equality, approving a credit card on a spouse’s income without considering household debt could hurt the economy.Comment on this story
“The CFPB certainly means well, but what it is suggesting will only hurt us in the long run,” Odysseas Papadimitriou, a former senior director in Capital One’s credit card division and current CEO of CardHub, said in a press release.
Papadimitriou suggests credit card companies review joint applications in which the combined income of the couple is listed along with its debt, in addition to providing a secured card option that allows cardholders to place a deposit on the card that would work as their credit line.