The CARD Act, passed in 2009, is intended to help safeguard customers. One provision of the bill is that those that provide credit cannot issue credit unless the applicant can prove that they can repay it. The law may have significant unintentional consequences, however. Some stay-at-home spouses may lose financial freedom. Source for this article – CARD Act could strip stay-at-home partners of financial identity by MoneyBlogNewz.
Needs of the CARD Act
The CARD Act contains several provisions meant to protect consumers from unfair or inappropriate practices of credit card issuers. In the Act, the way income is viewed changes. There are new rules for businesses. Community property and household income can no longer be considered as “income” on an application for credit. Applications can only have individual income. One person’s income is put there. The point is to safeguard customers for taking out too much credit. They’ll not be able to over qualify for the income anymore.
Effects of new CARD Act rules
All of the rules for the CARD Act may hurt some customers. Everyone that stays at home with children may have a problem. There may be one person who works while the other stays at home. In this case, the CARD Act makes it very hard for that stay at home person to get credit. Any stay-at-home spouses can be unable to get an independent credit history although it will stop those without income from getting a charge card. Without credit, there will be less opportunity for jobs. That will make it harder on a person if the relationship ends suddenly.
Troubles with the CARD Act and property that belongs to a community
In 10 of the 50 United States, married couples share what is known as “community property.” Partners have equal share of whatever is in the marriage according to the shared property law which might be changed with a pre- or post-nuptial agreement. Any community property states can still share the property. It just has to be split evenly between the two in the CARD Act. For couples not in community property states, the CARD act simply means that one partner cannot obligate the other partner to bad credit loans or other debt without their explicit agreement.
The CARD Act affects you also
If you are a stay-at-home partner, these new provisions of the CARD Act may have the biggest effect on you. Are you a stay-at-home partner without a job? Just prepare to have to get your partner’s signature on every little thing from personal loans to credit card. It is essential more now than ever to get your own credit card history. Make sure you keep talking to your partner about finances and keep up some kind of employment.
Articles cited
NCLC
nclc.org/
The Library of Congress
thomas.loc.gov/cgi-bin/bdquery/z?d111:HR00627:@@@D&summ2=m&
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