Posted by William Charles on April 17, 2015
Questions & Answers

Published on April 17th, 2015 | by William Charles

13

Can My Spouse (Husband/Wife) Use Household Income For Their Credit Card Application?

Hello, I have a question about what happen’s when a spouse doesn’t have their own income himself/herself and they want to apply for a credit card. Can they put down the total household income as their own? Can you explain a bit about the process and if it’s different for different banks?

Mohammad via e-mail

Hi Mohammad, thanks for the great question. I’m going to give you a short answer and then a longer answer explaining a bit more background.

Short Answer: You can list household income.

Longer Answer:

When the CARD Act became effective on February 22nd, 2010 on the of the requirements was that credit card issuers need to evaluate a consumers ability to pay back any debts they might incur before opening a new credit card account or issuing a credit limit increase. The chief way credit card issuers did this was to look at an applicants income. Under the CARD Act card issuers were only allowed to look at the individual applicants income and assets.

The reason that this was introduced was to reduce predatory lending practices that targeted the very young and those unable to pay back loans due to insufficient income. Unfortunately this had the unintended side effect of also making it almost impossible for stay at home spouses to receive credit and build credit history even if they had an employed spouse or partner that had the financially ability to pay down these loans.

On November 4th, 2013 the CFPB announced that this restriction would be changed. If a credit card applicant is over the age of 21 years of age credit card issuers are able to consider third party income (e.g income that a spouse or partner earns/household income) when making lending decisions as long as they have a reasonable expectation of access to these funds. The full rule change can be viewed here.

This means your partner (or yourself if you’re not the primary income earner) can list household income on their credit card applications. I hope this answers your questions and as always if you or anybody else has any questions about household income and credit card applications or just in general, please let us know in the comments below or by sending us an e-mail. You can view more readers questions that we’ve answered here.



13 Responses to Can My Spouse (Husband/Wife) Use Household Income For Their Credit Card Application?

  1. Jay says:

    Do you have to be married in order to qualify for this or can you include income from anyone that lives in the household, girlfriend/boyfriend, family members?

  2. JT says:

    Great Q&A. My wife stays at home, and we’ve always used household income when applying for her credit cards. Good to know that we are legally in the clear when doing so.

  3. Trevor says:

    Thanks for the info, Will!
    Was wondering if you had any thoughts or info on my situation, which I’m sure others have experienced. I am going back to school to get my MBA; my parents are kind enough to let me live with them while I do so, as my school is nearby. My income will be reduced to a part-time job. Can I put the income of the entire household on credit card applications…including the income of my parents? Obviously I would get their consent.
    My goal has now become to save miles for an international flight as part of program to go overseas. Thanks for anything you might share!!

  4. Logan Jung says:

    On the inverse, what happens if you claim more income than you actually bring in? Are there anyways for credit companies or bank to validate the income information you provided?

    • Parkerthon says:

      Great topic Will. A month or so ago I told my wife who has lesser earnings and income than I do to use her individual income because I was fearful of a financial review at some point for her individually making much less income. Looks like guidelines are much looser than one might be inclined to interpret with the simple application income field which definitely suggests applicants to be very narrow in what counts. Live and learn. Good share.

    • Parkerthon says:

      Didn’t mean to drop my previous reply on your post Logan sorry. Short answer is yes, they could ask for a tax return. It’s apparently pretty rare but if you get caught exaggerating they could shut you down and then put you on a list you don’t want to be on. Anectdotally, people that push the limits on spending with less history with a bank seem to get called on it mostly.

  5. Paul says:

    I have noticed that Citi is very open to allowing household income; whereas, other banks do not clearly state that you can use a third party’s income as your own even if you have full access to it (i.e. the typical husband/wife situation). I always roll my wife and I’s income into one, unless the application clearly allows for us to both state the amount but in different fields. Since we share our income intirely, I want credit for it with any/all applications. Not to mention the fact that I do not carry balances and always pay on time.

  6. Carlos says:

    Banks check income?? since when??

  7. Anonymous says:

    If a credit card company finds out that you knowingly lied about your income they can charge you with credit card fraud which is punishable buy up to 1 million in fines and or 30 years of imprisonment, I suggest you don’t do it!

  8. Cindy Bee says:

    Do the banks have to let you use household income? I was just denied a credit card because they wouldn’t allow household income – only mine.

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