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Wednesday, June 6, 2012

ABA Urges CFPB to Revise CARD Act Requirements

ABA's President and CEO Frank Keating on the CARD Act's "Ability to Repay" requirement:
We’re pleased that Congress is taking a closer look at the Credit CARD Act’s ‘Ability to Repay’ requirement. ABA has long supported revising this rule to ensure it’s consistent with congressional intent and fair to our nation’s stay-at-home spouses. Financial Institutions Subcommittee Chairman Shelley Moore Capito (R-W.Va.) and Ranking Member Carolyn Maloney (D-N.Y.) – who authored the Credit CARD Act – agree with that sentiment, which enjoys broad bipartisan support.

The current rule means household income can’t be considered when applying for a credit card, making it difficult for stay-at-home spouses to get credit in their own names or build a credit history. Their credit card accounts may be closed if they become widowed or divorced, and new ones could be hard to find. This harms not only those who haven't been in the workforce since marriage, but also careerists who take a hiatus to raise a family. These parents should maintain access to credit in their own names and be able to continue building their own credit histories – plain and simple.

We urge the CFPB to revise this flawed regulation. It’s the only right thing to do.

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