Federal Reserve could restrict credit access for stay-at-home spouses
Under a recently proposed Federal Reserve regulation, applying for a new credit card would get more difficult for stay-at-home spouses, according to some industry experts.
Current rules allow an individual’s entire household income to be considered on an application; however, the new regulation would put a greater emphasis on personal earnings. Many consumer advocates say this could block credit access for those who may need it most.
“We are concerned that the board’s proposal will hamper a stay-at-home mom’s ability to establish her own independent credit history by applying independently for a card,” according to a letter from Democratic Representatives Carolyn Maloney and Louise Slaughter, Marketwatch reports. “Many stay-at-home moms have a strong work history, yet the proposed regulations ignore their demonstrated credit-worthiness because of their lack of current market income.”
In addition, the two representatives say this could adversely affect women who are caught in abusive relationships or have recently experienced a divorce, as these individuals will likely face added hurdles to their independence, the news source reports.
Despite the impending regulation, consumers in community-property states will likely be unaffected as these states allow jointly owned assets to be accounted for on applications.