Homemaker denied credit card despite high household income
Homemaker denied credit card despite high household income
My wife applied for a JCB (Japan Credit Bureau) credit card on her own and was turned down because she has no independent income and we live in a non-community property state. Is there any recourse?
Facts:
Wife is now a stay-at-home mother (after many years in the labor force.)
Annual household income between $400,00 and $425,000.
Wife's FICO score greater than 800.
Residence is Illinois.
Details: My wife shops at Mitsuwa, a Japanese grocery store in the Chicago suburbs, but based in California. JCB offers a Mitsuwa credit card. Most of the customer base is clearly in California. Her application for the card was denied explicitly because she has no independent income and we live in a non-community property state. I called for clarification and was told that because I am the breadwinner, we could obtain the card only if I applied and added her as co-signer. They reiterated that JCB's policy is that a homemaker can't use household income to apply in a non-community property state. (This was the explicit reason given for denial of the card in both their written communication to us and over the phone.)
The program seems designed primarily for the California customer base (although it's marketed as available to Illinois residents.) I don't know a lot about consumer finance law, but the non-community property angle doesn't seem right, and I'm somewhat surprised that it would even be legal. I realize that there are some differences, but my wife certainly has similar legal rights to my income stream here in Illinois. I'm posting to the board to see if anyone has any experience in this area or explanations on how card companies can treat non-working spouses in the credit card application process and how this case might fit in.
Facts:
Wife is now a stay-at-home mother (after many years in the labor force.)
Annual household income between $400,00 and $425,000.
Wife's FICO score greater than 800.
Residence is Illinois.
Details: My wife shops at Mitsuwa, a Japanese grocery store in the Chicago suburbs, but based in California. JCB offers a Mitsuwa credit card. Most of the customer base is clearly in California. Her application for the card was denied explicitly because she has no independent income and we live in a non-community property state. I called for clarification and was told that because I am the breadwinner, we could obtain the card only if I applied and added her as co-signer. They reiterated that JCB's policy is that a homemaker can't use household income to apply in a non-community property state. (This was the explicit reason given for denial of the card in both their written communication to us and over the phone.)
The program seems designed primarily for the California customer base (although it's marketed as available to Illinois residents.) I don't know a lot about consumer finance law, but the non-community property angle doesn't seem right, and I'm somewhat surprised that it would even be legal. I realize that there are some differences, but my wife certainly has similar legal rights to my income stream here in Illinois. I'm posting to the board to see if anyone has any experience in this area or explanations on how card companies can treat non-working spouses in the credit card application process and how this case might fit in.
Re: Homemaker denied credit card despite high household income
Apply for a different credit card. I see no point in trying to fight this battle. Once she has her own credit card(s) from other place(s), she will probably not have this problem.
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Re: Homemaker denied credit card despite high household income
Apply jointly if you want the card.
I've had a bank deny me credit when I applied for a loan without DH. And I'm in CA.
I've had a bank deny me credit when I applied for a loan without DH. And I'm in CA.
Every day I can hike is a good day.
Re: Homemaker denied credit card despite high household income
OP,
Read this article. It may answer some of your questions and I think explain why the company made the decision correctly.
http://www.creditcards.com/credit-card- ... t-1282.php
Read this article. It may answer some of your questions and I think explain why the company made the decision correctly.
http://www.creditcards.com/credit-card- ... t-1282.php
"Don't trust everything you read on the Internet"- Abraham Lincoln
Re: Homemaker denied credit card despite high household income
This is what I was looking for. It's not the answer that I wanted to hear, but if there are clear-cut legal or economic reasons for being treated differently in community and non-community property states, then the bank's behavior is understandable. I wouldn't say correct in that I don't think major US banks do this. She has obtained her own credit cards based on household income from Chase, Citi, and a couple of others over the years. But now I understand why a California-based Japanese bank would do this.denovo wrote:OP,
Read this article. It may answer some of your questions and I think explain why the company made the decision correctly.
http://www.creditcards.com/credit-card- ... t-1282.php
Re: Homemaker denied credit card despite high household income
Glad to be of help. This illuminates things a bit more. http://blogs.findlaw.com/law_and_life/2 ... -debt.html There is more risk for the lenders in non-community property states. I think it's not surprising that a Japanese company is more conservative, especially one based in California that has good lawyers that understand the implications of community property vs not.mkikeda wrote:This is what I was looking for. It's not the answer that I wanted to hear, but if there are clear-cut legal or economic reasons for being treated differently in community and non-community property states, then the bank's behavior is understandable. I wouldn't say correct in that I don't think major US banks do this. She has obtained her own credit cards based on household income from Chase, Citi, and a couple of others over the years. But now I understand why a California-based Japanese bank would do this.denovo wrote:OP,
Read this article. It may answer some of your questions and I think explain why the company made the decision correctly.
http://www.creditcards.com/credit-card- ... t-1282.php
Notice "may" i.e. murky, there's room to argue, equals more risk.You may be held liable for "family expenses." In non-community property states you may be held liable for certain expenses even if you haven't co-signed for them. These expenses are ones that were incurred for the benefit of the family. Items that fall into this category include groceries and medical bills.
"Don't trust everything you read on the Internet"- Abraham Lincoln
Re: Homemaker denied credit card despite high household income
Thanks again. My elderly parents live in a community property and have significant amounts of appreciated equities. So, I was vaguely familiar with some of the estate planning differences between their state and ours. These articles point out potentially large day-to-day differences. I guess what's more interesting than the case of JCB from purely an intellectual standpoint is that when one calls the Citi representatives in South Dakota about getting a credit card approved, I don't think they're explicitly factoring this in very carefully. Maybe they are and I just don't see it. Or perhaps they can't because they're national companies with a vast majority of their customers outside the community property areas.Glad to be of help. This illuminates things a bit more. http://blogs.findlaw.com/law_and_life/2 ... -debt.html There is more risk for the lenders in non-community property states. I think it's not surprising that a Japanese company is more conservative, especially one based in California that has good lawyers that understand the implications of community property vs not.
You may be held liable for "family expenses." In non-community property states you may be held liable for certain expenses even if you haven't co-signed for them. These expenses are ones that were incurred for the benefit of the family. Items that fall into this category include groceries and medical bills.
Notice "may" i.e. murky, there's room to argue, equals more risk.
Anyway, thanks again. I figured I could get the answer at Bogleheads and I wasn't disappointed.
Re: Homemaker denied credit card despite high household income
She has reasonable expectation of access to that income. Therefore, she can put it on the application.
http://files.consumerfinance.gov/f/2013 ... l-rule.pdf
http://files.consumerfinance.gov/f/2013 ... l-rule.pdf
Re: Homemaker denied credit card despite high household income
Wow! Thanks. That takes this issue in a new direction. I'll review this document carefully and consider my next steps. However, my cursory reading is that JCB is somewhat beyond the pale in how they treated my wife's case.sls239 wrote:She has reasonable expectation of access to that income. Therefore, she can put it on the application.
http://files.consumerfinance.gov/f/2013 ... l-rule.pdf
Re: Homemaker denied credit card despite high household income
Just out of curiosity, but why does she want a JCB card in particular, and not, say, Visa or AmEx?
Last time I was in the market for a new card (but maybe things have changed since?), I got the impression that JCB is almost useless outside of Japan, and no better than Visa even inside Japan.
Last time I was in the market for a new card (but maybe things have changed since?), I got the impression that JCB is almost useless outside of Japan, and no better than Visa even inside Japan.
Last edited by bpp on Thu Jun 25, 2015 11:37 pm, edited 1 time in total.
Re: Homemaker denied credit card despite high household income
There's a store discount if you use the store card (issued by JCB)bpp wrote:Just out of curiosity, but why does she want a JCB card in particular, and not, say, Visa or AmEx?
Last I checked (but maybe this has changed?), I got the impression that it is almost useless outside of Japan, and no better than Visa even inside Japan.
Re: Homemaker denied credit card despite high household income
Ah, that's a good reason!
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Re: Homemaker denied credit card despite high household income
That would be an incorrect reading. The rule permits issuers to consider household income; it does not require them to do so.mkikeda wrote:Wow! Thanks. That takes this issue in a new direction. I'll review this document carefully and consider my next steps. However, my cursory reading is that JCB is somewhat beyond the pale in how they treated my wife's case.sls239 wrote:She has reasonable expectation of access to that income. Therefore, she can put it on the application.
http://files.consumerfinance.gov/f/2013 ... l-rule.pdf
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Re: Homemaker denied credit card despite high household income
Is that the only Japanese grocery store in the area? I would take my business elsewhere. Sometimes it's worth spending a bit extra to deal with a business that treats its customers better.
Re: Homemaker denied credit card despite high household income
Very surprised. My wife is a homemaker and we use household income for our credit card points/churning travel cards. I was certain the CARD act and the corresponding CFPB rule states that household income is correct.
I will find the link.
http://files.consumerfinance.gov/f/2013 ... l-rule.pdf
But yes, when I read it in the black and white ...
The final rule amends Regulation Z to remove the requirement that issuers
consider the consumer’s independent ability to pay for applicants who are 21 or older, and
permits issuers to consider income and assets to which such consumers have a reasonable
expectation of access.
It is the word "consider" not "require".
And yes, I would apply jointly for the card; happy wife = happy life.
I will find the link.
http://files.consumerfinance.gov/f/2013 ... l-rule.pdf
But yes, when I read it in the black and white ...
The final rule amends Regulation Z to remove the requirement that issuers
consider the consumer’s independent ability to pay for applicants who are 21 or older, and
permits issuers to consider income and assets to which such consumers have a reasonable
expectation of access.
It is the word "consider" not "require".
And yes, I would apply jointly for the card; happy wife = happy life.
Re: Homemaker denied credit card despite high household income
Very surprised to read this. I thought treating homemakers like unemployed adolescents had been illegal for over 40 years. A lousy grocery-store credit card?! It used to be that kids with no credit started building a credit history with this kind of account. Or do they also claim her previous credit history is non-existent as of marriage?
This sounds typically Japanese where the system-jerking that is done to devalue women's work makes "weasel" a compliment, but a Japanese outfit doing business in the US is stuck with US law. At least I thought so.
What next? The return of "Mrs. Fred Jones" credit cards?
Sounds like an opportunity for an op-ed piece in local media - these guys may well be doing business Japanese-style in other ways and wouldn't welcome scrutiny.
Vic
This sounds typically Japanese where the system-jerking that is done to devalue women's work makes "weasel" a compliment, but a Japanese outfit doing business in the US is stuck with US law. At least I thought so.
What next? The return of "Mrs. Fred Jones" credit cards?
Sounds like an opportunity for an op-ed piece in local media - these guys may well be doing business Japanese-style in other ways and wouldn't welcome scrutiny.
Vic
Re: Homemaker denied credit card despite high household income
I believe JCB cards work at any place that takes Discover.bpp wrote:Just out of curiosity, but why does she want a JCB card in particular, and not, say, Visa or AmEx?
Last time I was in the market for a new card (but maybe things have changed since?), I got the impression that JCB is almost useless outside of Japan, and no better than Visa even inside Japan.
Re: Homemaker denied credit card despite high household income
Thanks for the insights. I now get the point that CFPB rules are intended to permit, not require, the consideration of a spouse’s household income in cases where the Dodd-Frank legislation is trying to essentially protect consumers from themselves and preclude inappropriate lending to weaker households. However, the above document is very explicit in defining what constitutes a spouse’s “reasonable expectation” of access to household income. Because she was explicitly turned down on these grounds, I think JCB may have a problem. We check all the boxes: Married twenty-five years, during which time my continuous stream of paychecks have only gone into joint accounts to which my wife has had joint control. Irony of ironies, the only exception is that we have to fund her HSA with a small automatic deposit to an account that she owns individually.awval999 wrote:Very surprised. My wife is a homemaker and we use household income for our credit card points/churning travel cards. I was certain the CARD act and the corresponding CFPB rule states that household income is correct.
I will find the link.
http://files.consumerfinance.gov/f/2013 ... l-rule.pdf
But yes, when I read it in the black and white ...
The final rule amends Regulation Z to remove the requirement that issuers
consider the consumer’s independent ability to pay for applicants who are 21 or older, and
permits issuers to consider income and assets to which such consumers have a reasonable
expectation of access.
It is the word "consider" not "require".
And yes, I would apply jointly for the card; happy wife = happy life.
Of course, a credit card company can deny an applicant for lots of reasons: Too many accounts open for instance. On the other hand, they can’t behave in a discriminatory fashion to a particular class of borrowers, in this case non-working spouses in non-community property states. Reading through the text of how one defines “reasonable expectation of access,” that’s what JCB may have done here.
Re: Homemaker denied credit card despite high household income
IANAL but I don't agree. Expectation may be reasonable but JCB is still not required to consider -- they're just permitted to consider. JCB is known on the credit sites for being very restrictive in other ways as well. IMO it's a lost cause and your reasonable recourse is cosign or find another creditor.mkikeda wrote:However, the above document is very explicit in defining what constitutes a spouse’s “reasonable expectation” of access to household income. Because she was explicitly turned down on these grounds, I think JCB may have a problem.
Re: Homemaker denied credit card despite high household income
On the flip side, should a husband having a middle age crisis be able to take out a 18% interest rate loan to by a sports car? (I used to work in subprime auto lending and saw this many times). Can one person in the marriage commit their spouse to huge loans, encumbering their future? It cuts both ways. In a perfect marriage this would not matter but in the real world I am struggling with a wife who loves to gorge on debt. If she was earning the income to justify this I would grumble and people would tell me that wasn't modern enough and that credit was new way. However, she doesn't. (This is a bit of rant, but I need to vent someplace).legio XX wrote:Very surprised to read this. I thought treating homemakers like unemployed adolescents had been illegal for over 40 years. A lousy grocery-store credit card?! It used to be that kids with no credit started building a credit history with this kind of account. Or do they also claim her previous credit history is non-existent as of marriage?
Former brokerage operations & mutual fund accountant. I hate risk, which is why I study and embrace it.
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Re: Homemaker denied credit card despite high household income
That is not a protected class.mkikeda wrote:
Thanks for the insights. I now get the point that CFPB rules are intended to permit, not require, the consideration of a spouse’s household income in cases where the Dodd-Frank legislation is trying to essentially protect consumers from themselves and preclude inappropriate lending to weaker households. However, the above document is very explicit in defining what constitutes a spouse’s “reasonable expectation” of access to household income. Because she was explicitly turned down on these grounds, I think JCB may have a problem. We check all the boxes: Married twenty-five years, during which time my continuous stream of paychecks have only gone into joint accounts to which my wife has had joint control. Irony of ironies, the only exception is that we have to fund her HSA with a small automatic deposit to an account that she owns individually.
Of course, a credit card company can deny an applicant for lots of reasons: Too many accounts open for instance. On the other hand, they can’t behave in a discriminatory fashion to a particular class of borrowers, in this case non-working spouses in non-community property states. Reading through the text of how one defines “reasonable expectation of access,” that’s what JCB may have done here.
Re: Homemaker denied credit card despite high household income
At the risk of sounding political (which is not my intent!), the connection to longstanding concerns about gender equity in financial arrangements is pretty obvious. A personal finance angle more appropriate for this forum is whether any American banks maintain policies like this any more. If very few do, then why? An indication of the topic's importance is that I'm seeing lots discussion of this on the various miles and points blogs (I guess because spouses want their own sign up bonuses.) The general consensus on these sites, which may be wrong, is that "banks don't do that anymore." But I wonder if that's really true.2stepsbehind wrote:That is not a protected class.mkikeda wrote:
Thanks for the insights. I now get the point that CFPB rules are intended to permit, not require, the consideration of a spouse’s household income in cases where the Dodd-Frank legislation is trying to essentially protect consumers from themselves and preclude inappropriate lending to weaker households. However, the above document is very explicit in defining what constitutes a spouse’s “reasonable expectation” of access to household income. Because she was explicitly turned down on these grounds, I think JCB may have a problem. We check all the boxes: Married twenty-five years, during which time my continuous stream of paychecks have only gone into joint accounts to which my wife has had joint control. Irony of ironies, the only exception is that we have to fund her HSA with a small automatic deposit to an account that she owns individually.
Of course, a credit card company can deny an applicant for lots of reasons: Too many accounts open for instance. On the other hand, they can’t behave in a discriminatory fashion to a particular class of borrowers, in this case non-working spouses in non-community property states. Reading through the text of how one defines “reasonable expectation of access,” that’s what JCB may have done here.
Anyway, I trust that commenters maintaining that JCB is within its rights are correct on legal grounds.
Re: Homemaker denied credit card despite high household income
No, it is specifically not "household income." In fact if the credit issuer uses the term "Household income" then they have more hoops they'd have to jump through. So they avoid that term like the plague.
But if they are just asking for "Income" or "Your Income" or anything generic like that, then you can put all income to which you have a reasonable expectation of access.
If she puts 0 in the income "box" then of course she will be denied, it is equivalent to saying you have no income and no reasonable expectation of access to income. And my guess is that the problem isn't with the bank, but that she simply didn't fill out the application correctly.
If they go out of their way to ask specifically just for income that you yourself earn, then of course that would be different. But I don't know of any issuer who does this.
But if they are just asking for "Income" or "Your Income" or anything generic like that, then you can put all income to which you have a reasonable expectation of access.
If she puts 0 in the income "box" then of course she will be denied, it is equivalent to saying you have no income and no reasonable expectation of access to income. And my guess is that the problem isn't with the bank, but that she simply didn't fill out the application correctly.
If they go out of their way to ask specifically just for income that you yourself earn, then of course that would be different. But I don't know of any issuer who does this.
Re: Homemaker denied credit card despite high household income
JCB returned the original rejected application with a note. So, I have the handwritten document. It says "Annual Gross Income**" with the asterisk linking to "**California, Nevada, and Washington are community property states." So, they're really focused on the community property issue in defining a person's income. You're right. It does not say "Household Income." My wife filled the blank with our household's estimated annual income in 2015. However, she also wrote "Household Income" next to the figure. (Clearly she doesn't know how to play poker.) The only real glitch I found is that she listed herself as retired. She worked for a Japanese company before we moved to the US, and she has accumulated enough credits to receive Japanese Social Security. So, in that sense she is retired. But there was no need to put that. However, she and I each spoke with a JCB rep on the phone. There was absolutely no mistake in understanding our situation. They knew precisely what our status was and had a clearcut policy based on the community property issue.sls239 wrote:No, it is specifically not "household income." In fact if the credit issuer uses the term "Household income" then they have more hoops they'd have to jump through. So they avoid that term like the plague.
But if they are just asking for "Income" or "Your Income" or anything generic like that, then you can put all income to which you have a reasonable expectation of access.
If she puts 0 in the income "box" then of course she will be denied, it is equivalent to saying you have no income and no reasonable expectation of access to income. And my guess is that the problem isn't with the bank, but that she simply didn't fill out the application correctly.
If they go out of their way to ask specifically just for income that you yourself earn, then of course that would be different. But I don't know of any issuer who does this.
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Re: Homemaker denied credit card despite high household income
It would be interesting to see if a married, same sex couple, under the same household income situation, would face the same result.
How many retired people does it take to screw in a lightbulb? Only one, but he takes all day.
Re: Homemaker denied credit card despite high household income
Well if their policy is that they will not consider income that the applicant has a reasonable expectation to, then they need to say that, not just say that they don't count "household income." It could be that her handwritten "household income" scared them away.
I don't know if they are allowed to deviate from what the federal agency has defined as a reasonable expectation and substitute their own definition, which is what it sounds like they are doing.
It is your choice if you want to push it further with this particular issuer, but please know that most issuers, especially the big ones, don't do this.
I don't know if they are allowed to deviate from what the federal agency has defined as a reasonable expectation and substitute their own definition, which is what it sounds like they are doing.
It is your choice if you want to push it further with this particular issuer, but please know that most issuers, especially the big ones, don't do this.
Last edited by sls239 on Fri Jun 26, 2015 1:33 pm, edited 1 time in total.
Re: Homemaker denied credit card despite high household income
I applaud the bank for responsible lending. I don't know what your wife's gender has to do with it. Would they give you a credit card without an income?
Re: Homemaker denied credit card despite high household income
She has income.
She is married and has marital income.
That is true in all 50 states.
Just like if someone has an annuity, they have income.
She is married and has marital income.
That is true in all 50 states.
Just like if someone has an annuity, they have income.
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Re: Homemaker denied credit card despite high household income
Why is this unexpected?
My wife sent in an app at my prodding to get the bonus money. She put in our household income. They sent a letter asking for her pay stub supporting the income. She wasn't working and I expect that sending my pay stub might prompt a "you already have this cc, do you want us to add her as a user?". We dropped it.
My wife sent in an app at my prodding to get the bonus money. She put in our household income. They sent a letter asking for her pay stub supporting the income. She wasn't working and I expect that sending my pay stub might prompt a "you already have this cc, do you want us to add her as a user?". We dropped it.
Bogle: Smart Beta is stupid
Re: Homemaker denied credit card despite high household income
She has no income. She only has access to income, at least in a non-community property state.(It is murkier in a community property state) If you marry someone with an annuity, pension, or other source of income, you can't suddenly claim that you have one now as well. Banks are allowed to consider having access to income/assets/whatever for applications, but they are not required to. If you want them to consider your income, put both of your names on the application. Problem solved.sls239 wrote:She has income.
She is married and has marital income.
That is true in all 50 states.
Just like if someone has an annuity, they have income.
Re: Homemaker denied credit card despite high household income
Thanks for the insights and the 2013 document that you originally posted above. That gave me a better understanding of the rationales of mainstream issuers' current policies and helped me understand some provisions of Dodd-Frank that I hadn't bothered with before. I'll give this problem a little more thought, but will probably drop it. It's good to know that it's a somewhat anomalous case.sls239 wrote:She has income.
She is married and has marital income.
That is true in all 50 states.
Just like if someone has an annuity, they have income.
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Re: Homemaker denied credit card despite high household income
Yea, I was also denied JCB card, and I have under $10k personal income, high household income and 800+ credit score. It is the only card I have been denied and surprised me.
The company is VERY conservative and has very low credit limits. A single friend with annual income of $175K got credit limit of $2500, which is the lowest of all his CCards.
The company is VERY conservative and has very low credit limits. A single friend with annual income of $175K got credit limit of $2500, which is the lowest of all his CCards.
Re: Homemaker denied credit card despite high household income
Thanks for the comment. Irony of ironies. My wife received an AMEX Platinum 100,000 point offer in the mail today. They ask for "income available to you" and "assets available to you." I'd be surprised if she isn't approved straightaway because on those dimensions she'll score quite well. The targeted offer means her credit score is in the range of what they're looking for, which is probably pretty high for the Platinum card. We've never taken offers for those "high flyer" cards in the past because of the annual fees and the fact that we don't need them. But timing is everything in marketing, and we'll probably apply for this one, just for fun. We can use the points on ANA, our favorite airline, so that plus the statement credits mean that it's actually better than breakeven over the first two years. We had a good laugh over the fact that she'll probably end up with a card more appropriate to an international high flyer when what she really wanted was a card to buy groceries with.HIinvestor wrote:Yea, I was also denied JCB card, and I have under $10k personal income, high household income and 800+ credit score. It is the only card I have been denied and surprised me.
The company is VERY conservative and has very low credit limits. A single friend with annual income of $175K got credit limit of $2500, which is the lowest of all his CCards.
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Re: Homemaker denied credit card despite high household income
My point is if the OP really wants to pursue this he'll likely have to sue arguing that it has a disparate impact on a protected class. And that would not be the "non-working spouses in non-community property states" indicated above. While he can try a gender-based argument, as JCB is based in California, it isn't entirely clear to me that he'd be able to show the disparity.mkikeda wrote:At the risk of sounding political (which is not my intent!), the connection to longstanding concerns about gender equity in financial arrangements is pretty obvious. A personal finance angle more appropriate for this forum is whether any American banks maintain policies like this any more. If very few do, then why? An indication of the topic's importance is that I'm seeing lots discussion of this on the various miles and points blogs (I guess because spouses want their own sign up bonuses.) The general consensus on these sites, which may be wrong, is that "banks don't do that anymore." But I wonder if that's really true.2stepsbehind wrote:That is not a protected class.mkikeda wrote:
Thanks for the insights. I now get the point that CFPB rules are intended to permit, not require, the consideration of a spouse’s household income in cases where the Dodd-Frank legislation is trying to essentially protect consumers from themselves and preclude inappropriate lending to weaker households. However, the above document is very explicit in defining what constitutes a spouse’s “reasonable expectation” of access to household income. Because she was explicitly turned down on these grounds, I think JCB may have a problem. We check all the boxes: Married twenty-five years, during which time my continuous stream of paychecks have only gone into joint accounts to which my wife has had joint control. Irony of ironies, the only exception is that we have to fund her HSA with a small automatic deposit to an account that she owns individually.
Of course, a credit card company can deny an applicant for lots of reasons: Too many accounts open for instance. On the other hand, they can’t behave in a discriminatory fashion to a particular class of borrowers, in this case non-working spouses in non-community property states. Reading through the text of how one defines “reasonable expectation of access,” that’s what JCB may have done here.
Anyway, I trust that commenters maintaining that JCB is within its rights are correct on legal grounds.
Why do few banks do this? Because most banks want to pump people up with as much credit as they can and if they operate nationally can better recoup losses.
Banks are allowed to set their own lending standards.
Last edited by 2stepsbehind on Sat Jun 27, 2015 9:43 am, edited 1 time in total.
Re: Homemaker denied credit card despite high household income
I see no reason why a homemaker of either gender should be denied credit. Responsible lending is not giving access to unreasonable amounts of credit at ridiculous APRs - as in handing out credit cards like popcorn on college campuses - or not writing ninja mortgages.NonnyGoGo wrote:I applaud the bank for responsible lending. I don't know what your wife's gender has to do with it. Would they give you a credit card without an income?
Agreed, this can vary with the population served. My credit card from a university prof union has a credit limit about four times the limit on my credit card from a performing arts union. This makes sense since performers have notoriously volatile income, but the CU recognized 40+ years ago that we also need credit and are not irresponsible by definition.
If this bank took the same approach, they could issue the homemaker a credit card with a modest limit - suitable for grocery shopping - and not assume that in the event of her situation changing she would automatically default. They are not responsible; they are infantilizing a homemaker by treating her as an appendage to her spouse. It's a credit card, not a leash!
Vic
Re: Homemaker denied credit card despite high household income
Sounds like the problem is with your state laws, maybe you should lobby to change that. Not sure why the discussion is so focused on women, there are more and more stay at home men. In the case of divorcee, any stay at home spouse with no income will have a hard time paying off debt incurred based on a former spouse's income until they re-enter the workforce. Perhaps the OP's solution should be a post-nup where he legally binds himself to give his wife 1/2 his income in the case of divorce?
Re: Homemaker denied credit card despite high household income
I don't understand the distinction between community property/non community property states regarding this issue. Is the expectation that in the unlikely case of divorce the settlement would be zero in a non community property state?
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Re: Homemaker denied credit card despite high household income
I believe it somewhat has to do with the title of the thread, concerning "household income".legio XX wrote:I see no reason why a homemaker of either gender should be denied credit.<snip...>
Household indicates (at least to me) that one is part of a group of people, not an individual - unless you truly are a one person household.
An individual credit card however, is based upon the FICO score (or any other credit scoring model) that each person has. There is no such thing (that I know of) as a household FICO score.
My wife/me have both individual and joint credit cards, obtained over time based upon our individual and joint credit file information. In the early years of our marriage (late '60's) she was a SAHM and could not get a "name" credit card (in those days, Bank Americard, Visa) but she could get a few department store credit cards based upon her limited income before we were married.
When she returned to full-time work some five years later, she was able to qualify for any "personal" credit card based upon her then current income that she desired, even the "name" CC's of the time.
- Ron
Re: Homemaker denied credit card despite high household income
If the OP really wants his wife to get the credit card, he should just apply under his name with wife as the joint owner of the credit. Problem solved!!
Re: Homemaker denied credit card despite high household income
Yet, the reason stated for the denial of this CC was not due to a low FICO score. ( "Wife's FICO score greater than 800" )Ron wrote:An individual credit card however, is based upon the FICO score (or any other credit scoring model) that each person has. There is no such thing (that I know of) as a household FICO score.
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Re: Homemaker denied credit card despite high household income
My (disabled) son has two sources of income, from his Social Security Disability and Sheltered Workshop.2cents2 wrote:Yet, the reason stated for the denial of this CC was not due to a low FICO score. ( "Wife's FICO score greater than 800" )Ron wrote:An individual credit card however, is based upon the FICO score (or any other credit scoring model) that each person has. There is no such thing (that I know of) as a household FICO score.
He received his first (and only) CC when he was a university student many years ago and it has been used for many, many years with no missed payments.
Every once in awhile he receives a CC offer in the mail, and he applies for it just to get a "backup" card. And every time he's refused since his income does not meet the minimum level required by the card.
His current credit score (using Credit Karma - not the official FICO score, but "good enough")? 790....
Without a documented minimum level of current income, he will still be refused. FICO is used primarily to see your payment history, not to document your level of income - even though it will show current/past employers.
Heck, I'm retired (along with my wife). We have no employment income, but we still have our 1099's and SS documents to show our individual income. Without that "proof", I would venture to say that we would also have difficulty obtaining additional credit cards in our own names let alone any loan approvals, even though our individual credit scores are well in excess of 800.
- Ron