CFPB Finally Fixes the “Anti-Housewife” Rule


Just in time for Mother’s Day, the Consumer Financial Protection Bureau reversed an unpopular rule that some women’s advocacy groups called “insulting”— although it still took the agency almost a year to do it.

On Monday, the CFPB updated existing regulations so it will be easier for stay-at-home spouses to get credit cards.

Intended to keep credit card companies from giving people more credit than they could handle and letting them plunge into debt, the rule is an object lesson in the law of unintended consequences. It stipulated that issuers would have to take into account the applicant’s individual income rather than household income. Sounds logical…until you realize that it renders every stay-at-home parent who isn’t paid for dishes-and-diaper duty basically uncreditworthy.

This ill-considered rule was part of an amendment to the Truth in Lending Act’s Regulation Z, a CARD Act-era regulation the CFPB inherited from the FDIC. According to the CFPB’s own calculations, more than 16 million Americans, or one in three married couples, could have been affected.

(MORE: 10 Steps to Spring Clean Your Finances)

“I understand that the Federal Reserve is trying to make sure that the person responsible for the credit card can make the payments but did they go too far with this?” president of consumer education John Ulzheimer asked when the rule kicked in back in 2011.

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