The Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act), a law passed by a liberal Congress and signed by President Obama, “keeps many homemakers from qualifying for credit cards,” notes the world’s oldest law blog, Overlawyered. As Sheryl Nance-Nash notes at Forbes:
Andrea Frayser had the worst time getting a credit card. Why? She’s a stay-at-home mom. “It wasn’t until a bank representative told me to have my household budget direct deposited into an account with only my name on it to show regular income, and to list my position as “consultant”, that I was able to get several credit cards that way and establish a good credit rating of my own,” says Frayser. Frayser is far from the only stay-at-home mom having trouble getting credit.
Frayser’s difficulty is the result of the “Credit CARD Act of 2009” and related regulations, which require people applying for credit cards to “either list their own income, or get a co-signer.” “Simply put, those without a paycheck would not get a credit card” of their own, even if their household is perfectly capable of paying their credit card bills.
As Diane Katz of the Heritage Foundation notes, the CARD Act has been “interpreted as prohibiting millions of stay-at-home moms (and a few dads) from obtaining credit cards of their own altogether—just like the 1950s. That’s because the ‘ability to pay’ regulation requires credit card applicants to have an independent source of income to open an account, or else find a co-signer.”
The CARD Act also resulted in the elimination of many cash-back and rewards programs that benefited consumers, and effectively forced responsible credit card holders to subsidize irresponsible credit card holders. The law also resulted in annual fees for thousands of credit card holders whose credit cards previously had no annual fee.